SINGAPORE: The Ministry of Health (MOH) and Ministry of Social and Family Development (MSF) on Tuesday (Jul 16) said they are taking “immediate actions” to address concerns raised by the Auditor-General’s Office (AGO) in its latest annual audit report.
In its audit for the financial year 2018/19, the AGO found that while there were processes in place by MOH and MSF for approving and renewing grant programmes, there were inadequate checks for the disbursement of grants.
These grants relate to social programmes managed by the two ministries that provide funding to voluntary welfare organisations (VWOs).
The AGO found "a significant number of instances" where approval of funding came only after the funding period had started.
"There were also instances where grant was approved for payment or disbursed before funding approval was obtained or before an agreement had been entered into," said the report.
There were also errors in the computation of funds disbursed.
For MOH, test checks found instances in two major programmes where incorrect amounts were paid out by the ministry, while inadequate checks on data in an IT system could have led to over-disbursements under one of MSF’s major programmes.
READ: Auditor-General highlights weak IT controls, lapses in management of contracts and grants for social programmes
INADEQUATE CHECKS, POTENTIAL OF OVERPAYMENT
Under MOH’s operating subvention programme, S$469 million was disbursed from the ministry’s operating budget in the financial years 2016/17 and 2017/18. The programme provides grants for the operations of VWOs, including subsidies to eligible patients.
However, analysis of the records for 71,113 patients found that disbursements relating to 2,669 patients' records might be incorrect.
A total of 179 of these records were of deceased patients, and the remaining records contained means-tested subsidy rates which differed from MOH’s records.
If all 2,669 records were wrong, there would have been overpayments of about S$4.04 million and underpayments of S$3.84 million over a period of about two years and three months, said the report.
The AGO also noted that there was potential for overpayment of grants by the ministry, as it did not check on claims made by VWOs for overlapping service types for the same patient under the programme.
“For example, there were instances of claims for a patient staying at a nursing home and also claims for meal delivery service to his residence for the same patient on the same day,” said the report. “The claim period for these overlapping services ranged between one month and about two years.”
LAPSES IN MONITORING REQUIREMENTS FOR FUNDING
For both ministries, the AGO report flagged lapses in the monitoring of requirements for funding.
"Where documents such as audited financial statements were submitted by VWOs for the operating subvention programme, AGO noted that there was no evidence that MOH had reviewed them for a significant number of cases," the report stated.
When VWOs did not submit documents by the required deadline, MOH did not follow up with the organisations to obtain them.
As such, MOH would not have had adequate assurance that funding conditions were met, said the AGO in its report.
As for MSF, the AGO highlighted lapses in more than one grant stage for its family services programme, a major programme for the ministry.
For instance, the AGO found that funding to VWOs was obtained from the wrong authority or after the funding period had started.
There were also inadequate system controls over case recordings entered into an IT system, meaning that disbursements could have been made for case recordings which were not eligible for funding.
In a joint statement responding to the AGO’s findings, MOH and MSF acknowledged the need to strengthen controls.
“AGO’s in-depth thematic audit has found that MOH and MSF have established processes in place for the design and setup, evaluation and approval, disbursements, monitoring and review, and cessation of social grants,” said the ministries.
“However, there is a need to strengthen controls in areas such as ensuring timely funding approvals, verifying disbursements, and monitoring performance indicators of grant recipients," they added.
“Both MOH and MSF are taking immediate actions to address the concerns raised by AGO, including working with relevant VWOs to rectify over-disbursements and under-disbursements.”