The Department for Work and Pensions is today publicising its latest fraud figures.
It has published a press release online:
29 November 2012 – Benefit fraud bill is dropping – but more action is needed
Benefit fraud fell last year – but more action is needed to stop the £1.2bn cost to the taxpayer each year, Minister for Welfare Reform Lord Freud said today.
The Department for Work and Pensions (DWP) figures show total overpayments due to fraud and error stood at 2.1% of all benefit expenditure or £3.4bn over the last year.
Lord Freud said:
"We are fighting the battle against fraud and making advances, but fraud in the benefits system remains a huge problem.
"We have given our teams more resources and more powers so investigators are now actively tracking fraudsters, using a mixture of the latest technology and old-fashioned detective work.
"From next year, Universal Credit will also make fraud much harder to commit and easier to trace quickly."
With the introduction of Universal Credit in 2013, the benefits system will be made simpler and the opportunities for fraud and error will be greatly reduced.
Universal Credit will also substantially reduce overpayments due to claimant error – which rose to a record high of £1.4bn in the last year.
Lord Freud added:
"Clearly something is dramatically wrong with the current system when more money is lost because of mistakes by claimants than because of fraud.
"With Universal Credit bringing together six benefits into one, the system will be much easier for individuals to understand, and less vulnerable to human error."
A footnote to the press release shows that Jobseeker's Allowance fraud and error combined cost £230 million. It does not separate fraud and error, but if it follows the proportions set out above JSA fraud is likely to be around £100 million per year, or less than 0.1% of the total benefit bill. This is key: the only benefit designed for those deemed fit and ready for work contributes a statistically negligible amount to fraud. Those who talk of fraud in the system should look elsewhere for their scapegoats.
Headlining this press release 'Benefit fraud is dropping' when the information and figures included are primarily about error, demonstrates why we need to be so vigilant in overseeing how unemployed people and other claimants are portrayed. There have been moves to demonise unemployed people and other claimants by governments and newspapers over many years; all influential information release by both must be held to a high standard, and be fully representative of the truth it seeks to present.
We do not share the government's confidence that Universal Credit will reduce error; those who manage their benefits online for the first time may find the system hard to use, and computer error may well creep in and add to the error already in place.
We call on the government to provide free IT training, tailored to the needs of the online Universal Credit system, to all claimants who need it before the benefit is introduced. The government is likely to find this highly cost-effective, reducing the need for civil service oversight and reducing overpayments.