Report03-12-2025

Summery

About our audit

In June 2024 the media spotlight revealed that since 2020 the Employee Insurance Agency (UWV) had possibly made many errors in the assessment of incapacity benefit claims. Compulsory employee incapacity insurance is regulated by the Work and Income (Incapacity for Work) Act (WIA). On 23 October 2024 the Minister of Social Affairs and Employment (SZW) asked the Netherlands Court of Audit to carry out an independent audit of the quality management of and accountability for socio-medical assessments of incapacity benefit claims, of management and accountability within UWV and of the management and accountability relationship between UWV and the Minister of SZW. We honoured the request in order to contribute to the performance and learning ability of a government that keeps its promises and that the public can trust. Such a government stands or falls on cooperation between ministers, implementing organisations and parliament. This audit also complements previous audits we have performed on the implementation of the WIA and the minister’s oversight of it. As is customary, we ourselves decided on the audit scope, questions and approach so that the audit would be independent. We issued a preliminary report on 9 April 2025.

Results and conclusions

Between 2020 and 2024, UWV made considerably more errors in its socio-medical assessment of new WIA claims than in previous years. Various types of error were made in the calculation of benefits. There were errors in, for instance, the calculation of average monthly income, daily wages, the duration of benefit payments and in data entries in IT systems. These errors impacted the right to and amount and duration of tens of thousands of new incapacity benefit payments and thus the income of chronically incapacitated employees. Checks of socio-medical assessments were severely weakened by the poor quality of reports compiled by insurance doctors and occupational disability employment counsellors. In such cases, it is uncertain whether someone’s fitness for work and the duration and degree of their incapacity were assessed correctly.

Many of the errors we found related to daily wages. According to UWV’s estimates, errors in daily wages in 2020-2024 meant:

  • the incapacity benefit received by at least 16,385 claimants was too low;
  • the incapacity benefit received by at least 12,000 claimants was too high;
  • on average, people whose incapacity benefit was too low received €2,745 gross too little over the period as a whole, ranging from minor amounts to roughly €25,000.

The Court of Audit considers these estimates to be realistic. Besides errors in daily wages, UWV found errors in average monthly income. Based on UWV’s figures, we estimate that in the period 2020-2024:

  • 400 people incorrectly did not receive an incapacity benefit;
  • 1,600 people incorrectly did receive an incapacity benefit.

UWV has launched a correction operation to check 43,000 benefit payments in which an error might have been made in daily wages. The cases were selected by means of risk analysis. A complete analysis of all the errors that have consequences for incapacity benefit payments will not be possible as UWV does not have the capacity to check all 220,000 new claims made in 2020-2024.

The problems have several causes. Implementation of the WIA is inherently error prone, as it was before 2020, owing to the complexity of laws and regulations and the autonomous organisation, operational management and quality management at all levels of UWV’s organisation. IT support systems for socio-medical assessments are outdated. The sharp jump in the number of errors in assessments as from 2020 was due chiefly to the COVID-19 crisis. UWV was obliged to carry out fewer quality controls and staff working from home received less support from colleagues and management.

UWV claimants could barely check the accuracy of their assessments and incapacity benefit payments, if at all. UWV’s staff were not aware they were making more mistakes. Quality reports, however, contained worrying indications that there were errors in assessments and payments. There were several causes for the persistence of the high error rate and the lack of remedial measures until 2024:

  • a dysfunctional quality management system at UWV’s Socio-Medical Affairs (SMZ) division;
  • UWV and the Minister of SZW’s overriding focus on reducing assessment waiting lists;
  • the minister’s reluctance to simplify regulations and so reduce sensitivity to errors, including errors in the daily wages system;
  • the assumption that a high percentage of WIA benefits would be regular created a false sense of security for both UWV’s executive board and the Minister of SZW;
  • the minister had a blind spot concerning quality and UWV’s quality management system, particularly at the SMZ division. The minister’s oversight was not alert to quality risks that might have financial consequences for claimants.

The problems audited in the WIA scheme brought dysfunctional patterns and reflexes to light in the management relationship between the Minister of SZW as owner, contracting authority and regulator and UWV as service provider. These patterns and reflexes were undermining the management relationship and causing problems for claimants.

  • The minister’s management, oversight and key performance indicators did not pay sufficient attention to the quality of UWV’s operational management. The minister’s oversight had too little depth and focus to be of added value to UWV’s operational management.
  • The many roles in the tripartite management structure and the involvement of multiple ministerial units resulted in process-based management rather than substantive management.
  • UWV was generous in its provision of information but reticent in its identification and clarification of risks. The reticence was due to lack of trust between the Minister of SZW and UWV.
  • There was no shared problem ownership in the form of a common agenda for the simplification of the WIA scheme.

Measures UWV’s executive board took to strengthen quality management addressed the root causes of the many errors we identified. Quality reports suggest there were fewer errors in WIA assessments at the end of 2024 but there is no evidence that the measures taken are appropriate to reduce their number to an acceptable level.

Lessons and recommendations

Based on our audit findings and conclusions, we offer the following lessons and recommendations to UWV’s executive board, the Minister of SZW and the House of Representatives.

1. UWV must strengthen the basis for quality. Priority should be given to managing the accuracy and verifiability of socio-medical assessments and their timeliness. Employees who apply for an incapacity benefit must be satisfied that their assessments are accurate and their benefit payments are correct, that they can be checked and errors corrected where necessary.

  • To UWV: Revise the SMZ division’s quality management system.
  • To the minister and UWV: 
    -    Incorporate UWV’s quality management into the management and accountability system and specifically clarify its relevance to the    management of public values such as the human touch in UWV’s services.
    -    Make the quality of implementation a permanent item on the agenda. Make additional working agreements on the provision of information on quality. Ensure that facts about risks, uncertainties and dilemmas in UWV’s operational management are known and discussed. Develop a shared agenda to improve risk management and simplify the WIA scheme.

2. Internal and external management and oversight of UWV should provide a clearer understanding of the financial risks that people face when assessments are incorrect and cannot be checked.

  • To the minister and UWV: Subject to legal frameworks, develop a definition of regularity for the WIA (and other benefit schemes if appropriate) that is representative of the risk of benefit payments being too low or too high.
  • To the minister: Strengthen substantive oversight of UWV and satisfy yourself that information provided on the regularity of benefit payments is correct.

3. Benefit claimants must have an opportunity to check at least the plausibility of their assessments and benefits. This is not the case at present. This will in any event necessitate clear and understandable rules and communication.

  • To the minister and UWV: Make it possible for benefit claimants to check at least the plausibility of their assessments and benefits. Involve the Client and Service division to make sure that rules and communications are understandable.

4. Managing by public values such as the human touch in UWV’s services requires UWV to put the implementation of its statutory tasks in order. 

  • To the minister and UWV: Ensure that there is enough know-how and depth in the minister’s oversight of UWV’s operational management to identify, explain and critically discuss quality management risks.

5. To reduce sensitivity to error in the WIA scheme and avoid new correction measures, acknowledge that simpler and easier to implement regulations are unavoidable and more urgent now than ever before.

  • To the minister and House of Representatives: Take joint measures to ensure that the WIA scheme is simpler to implement and less sensitive to error.