By Lucy Phillips
29 January 2010
Cases of public sector fraud and data manipulation are set to increase over the coming months as government spending cuts put more pressure on managers to meet performance targets, experts have warned.
Ian Elliott, who leads the government and public sector forensic services practice at PricewaterhouseCoopers, told Public Finance that data manipulation was on the rise in public sector organisations in the face of tighter budgets, particularly among NHS trusts striving to meet waiting list targets.
His practice was experiencing a 50% increase in investigations compared with this time last year, with many cases larger in size too. Elliott expected the rise in inquiries to continue over the next 12 months, and for fraud to become more prevalent among middle and senior managers who were ‘best placed to influence in the wrong way’.
He said: ‘People don’t want to be seen as under-performing. The temptation becomes greater if you are under-performing to make it appear as if you are not.’
According to a survey of global economic crime by PwC, exclusively revealed to PF, half of UK public sector organisations experienced fraud in the last year, compared with 37% worldwide. Incidents of fraud had increased in 46% of the 44 UK public bodies surveyed.
Of all the cases last year, 46% were internal and 46% external. Elliott said this would come as a surprise to many public sector organisations that were ‘in denial about the risk of internal fraud’.
Earlier this month, the National Fraud Authority published figures showing fraud cost the UK economy over £30bn a year. Public sector fraud accounted for 58% of the total, equating to £17.6bn, although other estimates have put the figure much higher.
29 January 2010
Cases of public sector fraud and data manipulation are set to increase over the coming months as government spending cuts put more pressure on managers to meet performance targets, experts have warned.
Ian Elliott, who leads the government and public sector forensic services practice at PricewaterhouseCoopers, told Public Finance that data manipulation was on the rise in public sector organisations in the face of tighter budgets, particularly among NHS trusts striving to meet waiting list targets.
His practice was experiencing a 50% increase in investigations compared with this time last year, with many cases larger in size too. Elliott expected the rise in inquiries to continue over the next 12 months, and for fraud to become more prevalent among middle and senior managers who were ‘best placed to influence in the wrong way’.
He said: ‘People don’t want to be seen as under-performing. The temptation becomes greater if you are under-performing to make it appear as if you are not.’
According to a survey of global economic crime by PwC, exclusively revealed to PF, half of UK public sector organisations experienced fraud in the last year, compared with 37% worldwide. Incidents of fraud had increased in 46% of the 44 UK public bodies surveyed.
Of all the cases last year, 46% were internal and 46% external. Elliott said this would come as a surprise to many public sector organisations that were ‘in denial about the risk of internal fraud’.
Earlier this month, the National Fraud Authority published figures showing fraud cost the UK economy over £30bn a year. Public sector fraud accounted for 58% of the total, equating to £17.6bn, although other estimates have put the figure much higher.
