FILE - Illinois Retail Merchants Association President Rob Karr

Illinois Retail Merchants Association President and CEO Rob Karr

(The Center Square) – The Senate Labor Committee heard testimony Wednesday regarding the ongoing problems at the Department of Employment Security, including fraudulent claims, delays in sending out benefits and a shrinking fund that pays out those benefits.

Since the COVID-19 pandemic began, IDES has seen a deluge of 1.8 million new unemployment claims. With all of the new claims and people entering into the unemployment system for the first time, the agency has struggled to keep up with the demand.

The Unemployment Insurance Trust Fund, which funds unemployment payments, is in the red. 

Rob Karr, president of the Illinois Retail Merchants Association, said the current deficit is far worse than during the Great Recession of 2008.

“We have to keep in mind the problem that is front of us,” Karr said. “The Unemployment Insurance Trust Fund projected deficit over three years is somewhere between $8 to $11 billion dollars. To put that in perspective, the biggest challenge we’ve had in the past was $2.35 billion.”

Claimants have told stories of the issues applying for benefits, contacting a live body at IDES, or receiving a return call. Jeremy Rosen, director of economic justice with the Shriver Center on Poverty Law, said the IDES offices should have stayed open during the pandemic.

“We are strongly concerned that IDES has not risen to the occasion to provide these workers with the benefits they need to survive during this time,” he said.

Fraudulent claims are another problem. The agency is being inundated with fraudulent claims, with the total claims caught by IDES in the hundreds of thousands.

For months, Illinoisans have been getting letters in the mail asking them to pay back benefits, sometimes as a result of fraud, other times because of overpayment by the state.

Pat Devaney, secretary-treasurer with the Illinois AFL-CIO told the committee it is going to take money to combat fraud in the future.

“I think a way to best at rest, making sure we are able to recapture those fraudulent claims that have been made due to proper investigation and enforcement, is going to require significant investment into the agency,” Devaney said.

Devaney added that the problems its union members are facing pre-date the pandemic.

“Many of the problems claimants were experiencing during the spring and summer of last year were the result of years of disinvestment in IDES, as we’ve seen in multiple other state agencies that provide valuable services to those who need them the most,” he said.

Staff Reporter

Kevin Bessler reports on statewide issues in Illinois for the Center Square. He has over 30 years of experience in radio news reporting throughout the Midwest.