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Department of Veterans Affairs' $145 million in overpayments

Millions of taxpayer dollars is being wasted because of mistakes by public servants and welfare recipients.

The Department of Veterans Affairs has written off or waived more than $10 million it has overpaid to veterans and their families in the past five years.

The department has revealed it wrote off or waived overpayments if they were caused by bureaucratic bungles and the debt was not discovered within six weeks of the money being mistakenly paid.

Other debts were cancelled if the client had died and the next of kin decided not to repay.

More than 100,000 veterans and their families have been overpaid a total of $144.6 million by the Department of Veterans Affairs in the past five years.

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Of this, DVA had so far recovered $124.7 million and was in the process of tracking down or waiving the rest with almost 10,000 clients across Australia still owing $31.07 million.

The figures were provided in an answer to a question on notice lodged by Tasmanian senator Jacqui Lambie.

In its response the department said it paid $35.04 billion in pensions during the same period, which meant overpayments accounted for 0.41 per cent of total pensions paid.

The department said the majority of the overpayments related to service pensions and other income support payments under the Veterans Entitlements Act "incurred mainly as a result of pensioners not advising within the prescribed time period that their personal or financial circumstances had changed".

The act covers service in wartime and certain operational deployments, as well as certain peacetime service between 1972 and 2004, according to DVA's website.

Most of the mistakes related to small sums of money with nearly 80 per cent of the debts relating to overpayments of less than $2000 a client.

"Where an overpayment occurs, a repayment plan is developed based on the person's capacity to repay the debt," the department said.

"While it is preferable for a person to make a lump sum payment or partial payment to expedite the recovery of the debt, where the person does not have sufficient funds, DVA negotiates a regular repayment plan.

"If there is a change to the person's circumstances for example, a reduction in their income or the receipt of an inheritance, the repayment plan can be adjusted [either reduced or increased] to take account of the changed circumstances."

DVA is one of the Commonwealth departments where union members have been taking industrial action as staff negotiate an enterprise bargaining agreement in the face of possible job cuts some employees say would affect service delivery.

At the start of the year DVA staff were asked to accept a pay deal of 0.6 per cent per year – worth less than $9 a week to a typical employee at the department – which came with a longer working day and cutbacks to DVA's middle management ranks.

The pay offer of 1.75 per cent over three years was conditional on 57 of the department's 440 executive level officers being trimmed from the ranks.