Councils need to do more to stop fraud, says Audit Commission

14 Sep 09
The Audit Commission is urging councils to do more to fight fraud, warning that hundreds of millions of pounds are being lost each year due to false benefit claims and tax avoidance
By David Williams

15 September 2009

The Audit Commission is urging councils to do more to fight fraud, warning that hundreds of millions of pounds are being lost each year due to false benefit claims and tax avoidance.

In Protecting the public purse, published today, the local government regulator emphasises that the recession is likely to be a trigger for increased fraud.

It estimates that cheats in housing, such as dishonest applications and illegal subletting, have prevented 50,000 legitimate claimants from being given council homes.

The commission calculates that fraudulent council tax discount claims for single people cost £90m a year alone. It highlights concerns that other benefits, such as blue badges for disabled drivers and direct payments for social care, might have been misused.

In procurement, councils have been cheated by cartels of contractors tendering uncompetitive bids, the commission says.

The report praises councils with zero-tolerance fraud policies. It also highlights the importance of investing in stronger vetting procedures for new employees, as such measures have uncovered workers who have no right to work in the UK.

The commission has drawn up a checklist for councils to use to ensure their anti-fraud systems are working properly.

Audit Commission chief executive Steve Bundred said: ‘It has never been more important that councils fight fraud. Every pound lost to cheats is a pound that can’t be used for people in real need.’

The commission is to begin conducting annual surveys to monitor emerging risks and changing levels of fraud and its associated costs, starting with the 2008/09 financial year.

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