National Fraud Initiative saves nearly £200m in two years

4 Nov 16

The government has called on councils and other public sector bodies to join the Cabinet Office’s National Fraud Initiative after a review found it had saved almost £200m in two years.

The scheme, which matches electronic data within and between public and private sector bodies to prevent and detect fraud, could save the taxpayer millions more over the coming years if there was widespread participation, Cabinet Office minister Chris Skidmore said.

According to a statement released today, the NFI identified and prevented fraud, overpayments and errors amounting to £198m in England from April 2014 to March 2016.

Pension fraud and overpayments was the top saving for the taxpayer at £85m, followed by welfare benefit fraud and overpayments at £39m, and then council tax single person discount payments at £37m.

According to the report, combined losses from fraud and error in central and local government spending amount to between £20bn and £49bn annually. Since it began in 1996, the NFI has identified fraud and overpayments in excess of £1.39bn.

Other achievements from the scheme were to recover 54 properties for social housing and remove 726 false applications from housing waiting lists. Also, 23,063 blue badges for disabled parking were cancelled, along with 97,064 concessionary travel passes.

The scheme works by cross-referencing the extensive range of data from almost 1,300 organisations across the UK. This can highlight discrepancies between records for individuals kept by different bodies.

The report noted that although most public bodies have solid arrangements in place for managing NFI participation, the scheme and public bodies should work together to understand how the results can be used to maximise the amount of fraud and error overpayments found.

It also highlighted that some participants do not make best use of the results or the available tools.

Skidmore has called on councils, housing associations and the wider public sector to engage with the scheme to save even more money. 

“Many public sector organisations have limited capacity to investigate fraud, leaving them vulnerable to risks of overpayments and fraudulent claims,” he said.

“I would like to see councils and other public sector organisations take full advantage of the NFI. By working together and maximising the benefits of the exercise we could save the taxpayer millions more over the coming years. We must identify individuals, safeguard taxpayers’ money and protect vital public services.”

Dave Conway of Stoke-on-Trent City Council said the NFI meant that councils could work with other bodies across the public sector on new ways to tackle the risk of fraud and error.

“By working in smarter ways to tackle fraudsters, we are able to better maximise council resources and protect residents,” he added.

This year, for instance, the NFI has launched a new fraud prevention tool, AppCheck, to allow the data it holds to be used by stakeholders in fraud prevention efforts. The aim is to enable more efficient and unified ways of working, and allow smaller groups to better target their local fraud risks.

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