Arkansas Workforce Services: “It’s OK, We Only Squandered $23.8 Million!”


Arkansas unemployment wasteA worthy addition today to the “Just How Much Damn Money ARE They Wasting?” genre from Alison Sider of the Arkansas Democrat-Gazette: Sider follows up with state Dept. of Workforce Services (DWS) officials on the question of some $161 million in improper unemployment payments made over the last three years. Surprise! They say it’s not that much (subscription required).

DWS claims to have identified “actual, verified overpayments” of $23.8 million over the last three years (The stats by year: 2011-$11.1 million; 2010-$6.5 million; 2009-$6.2 million=$23.8 million).

That’s a lot less than $161 million, the amount of improper payments as determined by the U.S. Dept. of Labor, but still a huge amount of money to just have walking out the door.

But does the lower figure represent a reliable accounting? I’m betting probably not.

Noted: A department spokesperson emphasizes that the larger $161 million figure from the Dept. of Labor is “based on a sample and is an estimate.” The implication being that an estimate based on a sample is not reliable.

Two points about that little smokescreen:

1) You know where else we use sampling and estimates? When calculating the unemployment rate. And the consumer price index. And about a million other things. Sampling is pretty much the cornerstone of the entire field of data collection, as well as public opinion and political polling.

Because it turns out statistical sampling delivers a typically reliable snapshot of the whole, when conducted properly. Sider’s story deftly underscores this point by interviewing an expert with the National Opinion Research Center, who explains how sampling can be and is “a valid way of drawing inferences about a population.”

2) Sampling and estimates are even more necessary when looking at questions of waste, fraud and abuse, because these are things that, by their very nature, are not transparent. You don’t just open up an Excel spreadsheet of unemployment benefits payments and scroll over to the “Waste, Fraud and Abuse” column to see how much there is.

That’s a long way of saying that Workforce Services is going into desperate spin mode in hopes of making this story go away, or at least confusing the storyline. Legislators with oversight responsibility for the department shouldn’t let them get away with that.

I’m willing to believe the $161 million figure in improper payments the feds identified may be too high—the actual number may very likely be much lower, once it all shakes out.

But it’s going to be much, much higher than this $23.8 million figure that state officials are trumpeting after what must have been an exhaustive four-day review of three years worth of claims. Mark it.

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8 thoughts on “Arkansas Workforce Services: “It’s OK, We Only Squandered $23.8 Million!”

  • September 22, 2011 at 8:10 pm

    “DWS claims to have identified “actual, verified overpayments” of $23.8 million over the last three years…”

    The key words here are “identified,” “acutal,” “verified,” and” “overpayments.” Since DWS identified the overpayments and have verified the overpayments are actual, DWS must know to whom the money went, in what amount, and when. In other words, for example, DWS will have verified an actual payment in August – December of 2009 to Joe Blow in the amount of $330 per week for 22 weeks. Thus, DWS goons should be going to the home of Joe Blow and advising Mr. Blow he should pony up his verified, actual overpayment.

    The next step is to fire the state employee(s) responsible for this incredible lack of oversight and attention to detail which allowed waste and/or corruption at this extent to occur. I recommend starting at the top. Unfortunately, the Governor can’t be fired. Fortunately, his double-dipping employee can be and should be.

    If DWS can’t identify the individual recipients of the money, then they have actually lied and have not actually “…identified “actual, verified overpayments” of $23.8 million over the last three years.” Again, firings are in order and they must start at the top.

    $23.8 million is approximately 7% of the $330 million plus we owe the Federal Government back, an amount addressed in the recent legislative session. The actual and verified over payment amount would make pretty nice down payment. I suspect $23.8 million paid ahead would at least have a good impact on the interest.

    Or, get it all back and give it to the legislators to divvy out in GIF funding. That sentence alone is sure to give a shiver of excitement in the groinular areas of legislators all across the state. Let the committee hearings begin…

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  • September 23, 2011 at 10:23 pm

    David, your grasp of basic math is astounding. Why aren’t you rich from explaining statistics to government agencies yet?

  • September 24, 2011 at 4:41 pm

    No, Bill, I think I need to keep plugging away at this website. I saw an article in ‘Time’ that said the Internet is going to be HUGE!

  • September 24, 2011 at 10:38 pm

    I bet you’re flush with cash. I’m sure you can buy a nickel pie at McDonald’s any time you want.

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