Managing the Risk of Benefit Fraud

A recent report from the UK Parliament’s Work and Pensions Committee has warned of uncertainty over how the Department of Work and Pensions (DWP) will manage the housing costs element of Universal Credit without increased risks of fraud and error.

The Government has stated that an IT system (the Integrated Risk and Intelligence Service (IRIS)) will allow it to cross-check data and provide similar safeguards against fraudulent claims under Universal Credit as are currently operated by local authorities within the Housing Benefit system.

However, last year the National Audit Office (NAO) found that IRIS was "missing" from the UC Pathfinders, and it remains unclear how or when DWP will achieve automated access to the range of property data currently available to local authorities.  The Committee has said that such a system will need to be fully developed and tested before national implementation of Universal Credit commences.

The official estimated benefit fraud rate is 0.7% of total benefits expenditure, however the report highlights that the general public’s misperception is that it is some 34 times higher.

To reduce the risk of confusion in media reporting, the committee recommends that DWP should publish statistics relating to the estimated level of benefit fraud on a separate day from those related to errors in the benefits system.

The report also highlights that fraud and error rates have plateaued from 2005/06 to 2012/13, despite an “uncompromising” and "zero tolerance" approach announced by the coalition Government.

The Committee believes the DWP will only meet the target set in 2010, to reduce the estimated overpayment rate to no more than 1.7% by April 2015, if it employs innovative approaches which are aligned with the known risk factors associated with each benefit.

Contains Parliamentary information licensed under the Open Parliament Licence v1.0.

Criminal defence and legal advice in Scotland

For specialist legal advice, including advice on benefit fraud charges, from our criminal defence solicitors based in Glasgow contact us today.