06 December 2002
In an interview with Public Finance, Malcolm Wicks, whose portfolio extends across the Department for Work and Pensions' anti-fraud team, revealed that the DWP has undertaken the first detailed study of housing benefit fraud since Labour came to power.
The most 'recent' estimate by the National Housing Benefit Accuracy Review is five years old and suggests that around £840m of the annual £13.5bn housing and council tax benefit payments is lost to fraud or incorrect payments.
It is widely expected that the new figures will run into billions of pounds. Wicks is the first minister to acknowledge the possible extent of the problem. 'The figures will certainly be in the hundreds of millions – possibly more. We will make sure we take the right steps, not just token steps, to combat it,' he told PF.
Wicks accused many local authorities of doing little to prevent fraud 'because they have paid scant regard to ensuring their [inspection] system and claimant records are watertight. That must change', he warned.
The Benefit Fraud Inspectorate, the DWP spin-off launched in 1997, recently criticised Derby City Council, among others, for failing to tackle the problem adequately.
Hinting at possible future reforms, Wicks said other councils, like Camden in north London, were 'walking quickly down the path of inspection and improvements that we want to see replicated across the board'.
Lesley Pigott, head of benefits at Camden, said the authority's success in combating fraud was down to both councillors' realisation of the financial benefits and Camden's fully integrated benefits division.
'The whole system, including the fraud inspectorate, is run in-house. Other councils may have a more confusing set-up,' she said.
A spokesman for the Local Government Association said the introduction of an anti-fraud incentive scheme in April had encouraged more local authorities to be proactive and that 'interim results show significant improvements are being made'.
PFdec2002
