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After all of the posturing and political rhetoric has quieted, the recently concluded state budget impasse can be boiled down to a disagreement between two basic philosophies of government spending.

One holds that government spending can increase without regard to the revenue on hand and taxes can be raised to make up the difference.

The other philosophy holds that government must live within its means and all spending decisions should be based on the amount of money available, not on the assumption that taxes can be raised to generate the money we would like to spend.

A key component of the second philosophy is that government should seek to gain maximum efficiency from every taxpayer dollar it spends. That means eliminating waste, fraud and abuse at every level of government.

Throughout state government, there are examples of taxpayer dollars being used inefficiently. One example is the Department of Public Welfare (DPW), which consumes about one third of the state budget.

In recent months, Auditor General Jack Wagner has issued several reports highlighting inefficiencies and abuse at the DPW. One audit of the Medicaid program, which is administered by the department, found that 14.1 percent of Medicaid eligibility determinations were made improperly. Many of the improper eligibility determinations were due to failure to verify the recipient's age, income and financial information, disability, or family relationships.


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The Auditor General has asserted that the minimum savings that could be realized by resolving this problem is $320 million. Some estimates put that figure as high as $640 million.

A second audit found that the DPW failed to properly justify more than 45 percent of the payments made through what is known as a special allowance program designed for recipients seeking employment. Auditors, who were unable to find sufficient documentation to justify thousands of so-called special allowance payments, concluded that "the program was rife with mismanagement and poor oversight" and the department had inadequate controls in place to compel recipients to make only authorized purchases. The potential fraud and abuse in this program alone could cost taxpayers tens of millions of dollars.

While Welfare Secretary Estelle Richman recently wrote to legislative leaders to claim she has a plan to fix the problems uncovered in the audits, I have serious doubts about her ability to implement such a plan. If Secretary Richman and the governor were serious about eliminating fraud and abuse at the DPW, they would have done it by now. Moreover, the fact that the governor did not seek less money for the department in the recent budget negotiations is a clear indication that he is not committed to rooting out the systemic problems and abuse that brought the agency to this point.

Under the leadership of Rep. Gordon Denlinger, R-Lancaster, and Rep. Mauree Gingrich, R-Lebanon, the House Republican Policy Committee's Budget and Economic Policy Task Force has developed House Bill 1856, a series of reforms designed to bring about greater accountability and efficiency within the DPW to ensure that the Pennsylvanians who truly need assistance are receiving it.

Among other things, our legislation would:

---Require the DPW to submit information on its plans and operations, including work participation and verification plans, to the General Assembly and the state treasurer's office and post them on the Internet.

---Provide for a comprehensive audit of DPW which includes provider and recipient sampling to identify fraudulent actions in the department.

---Establish a computerized Income Eligibility Verification System that would cross check 19 different federal and state databases on a quarterly basis to ensure that applicants are eligible for the benefits they are claiming. 

---Eliminate special allowances -- except for fees or dues that are conditional on gaining employment and are pre-authorized -- for welfare recipients, including special payments for the purchase or repair of a vehicle, tools, etc.

---Require that residency be a requirement for receiving assistance. Residency would be established when an individual resides in the commonwealth for at least 90 days.

---Require applicants between the ages of 18 and 65 to take and pass a test for illegal drugs as a condition of receiving benefits.

---Prohibit the purchase of alcoholic beverages with welfare dollars.

House Bill 1856 provides reasonable, commonsense solution to the problems outlined in the auditor general's reports. I strongly urge House leaders to bring it to the floor for consideration as soon as session resumes.

To learn more about House Bill 1856 and other House Republican legislative initiatives, visit pahousegoppolicy.com.

State Rep. Stan Saylor is a Republican representing the 94th District in York County. He writes a monthly column for the York Dispatch Opinion page.