12 November 2008
A headline grabbing set of figures have been released by the Government pointing to £2.6bn worth of benefits lost to fraud and error in the last financial year.
The official statistics state that 2% of the total benefit bill was overpaid between April 2007 and March this year.
The figure, the same amount as in 2005-6, included a £380m overspend on Pension Credit - 5.1% of the total spending on that benefit.
The figure not picked up on as widely was the £1.1bn that should have been paid in benefits was not handed over. The underpayment covered people who were not paid as much as they were entitled to and did not include people who were entitled to benefits and failed to apply, or those whose benefits were incorrectly rejected.
The Department for Work and Pensions maintained the statistics still do not present the true picture, with a spokeswoman saying that some fraud might not be uncovered because “by its nature, it’s a covert activity." However, it is also the case that the failure to distinguish between fraud by claimants and errors made by the DWP means that the true level of fraud may be lower than it appears from these statistics.
The breakdown of the figures shows that £540m of Income Support and Jobseeker's Allowance was overpaid owing to fraud or error, 4.9% of the total budget. A further £720m (4.6%) was also overpaid in housing benefit.
Separate figures show that a growing amount of child maintenance payments is being collected or arranged by the Child Support Agency (CSA).
The figure reached £1.1bn in the 12 months to the end of September, up £147m on the previous year.
A reported 778,000 children are benefiting from the payments, under a system that has been heavily criticised in the past.
The new Child Maintenance and Enforcement Commission has now taken over responsibility for ensuring absent parents pay what they owe.
A change in the rules, which came into force on 27 October, means that parents with care of these children who are also claiming benefits are no longer compelled to use the CSA to collect or arrange maintenance payments.