A report has found that Australia’s high-earning government officials from Northern Territory received over $3.6 million ($US2.6 million) in overpayments in the last financial year, with some of the money still not recovered.
Australian Payroll Association revealed the territory’s largest employer overpaid one staff member by almost $100,000 in a single transaction, the largest payroll error made in the investigation.
During the 2020-21 financial year, The NT government made a total of 2,365 overpayments totalling millions paid to 1,443 employers, Auditor-General Julie Crisp found in her latest report.
“My review of the data related to salary overpayments highlights the necessity for management to be vigilant at all times,” Crisp said.
While “management has a responsibility to ensure financial losses are recovered in a timely manner,” and the majority of the recent overpayments were paid back in four months, $1 million was still outstanding as of August last year.
There are also $2.8 million of historical overpayments yet to be recovered.
One of the cases dates back to 2013 when an employee received $83,246 in overpayments. So far, about a quarter of the debt has been repaid.
“This employee pays $100 per fortnight to settle the debt, thus the debt is expected to be extinguished in approximately 24 years,” Crisp said.
Those responsible for making the largest overpayments were Top End Health Service, followed by the Education Department, the Central Australian Health Service, and NT Police.
Their reasons for overpaying included staff being paid after they resigned, receiving money while on leave without pay, a change of working hours, entitlement conditions set up incorrectly, or contract ceasing in the wrong pay cycle.
But historical overpayments are ambiguous and the cause of most was unknown.
The oldest overpayment worth nearly 40,000 dates back to 2010, but only a third of the money has been recovered and the last instalment was made five years ago.
“This suggests that better root cause analysis and recording is required in order for agencies to implement improvements to processes and controls to reduce the risk of overpayments and the resultant financial loss to the NT,” Crisp said.
Crisp’s audit from the previous financial year also found superannuation payment errors, including evidence that the errors were known by senior government personnel in two departments since 2013, but not acted upon.
“It is evident from the number of errors identified during this audit that since 2009, there has been no person/position in the Northern Territory Government with responsibility for ensuring superannuation guarantee amounts have been paid correctly across the Northern Territory Public Sector in accordance with superannuation legislation,” she wrote in her report.