Benefit fraud  

benefit fraud in the UK

     
  The government understates benefit fraud
   

The DWP's official estimates for benefit fraud for 2008 - 2009 are here.

 

Expenditure

Fraud

Last measured

Income Support

£8.8bn

2.9%

£250m

Apr 08 - Mar 09

Jobseeker's Allowance

£2.9bn

2.8%

£80m

Apr 08 - Mar 09

Pension Credit

£7.8bn

1.5%

£110m

Apr 08 - Mar 09

Housing Benefit

£17.1bn

1.5%

£260m

Apr 08 - Mar 09

Instrument of Payment

 

 

£10m

Apr 08 - Mar 09

Disability Living Allowance

£10.6bn

0.5%

£50m

Apr 04 - Mar 05

Retirement Pension

£61.6bn

0.0%

£0m

Apr 05 - Mar 06

Carer's Allowance

£1.4bn

3.9%

£50m

Apr 96 - Mar 97

Incapacity Benefit

£6.6bn

1.0%

£70m

Apr 08 - Mar 09

Interdependencies

 

 

£10m

Apr 08 - Mar 09

Unreviewed

£14.7bn

0.7%

£90m

 

Council Tax Benefit

£4.2bn

1.3%

£50m

Apr 08 - Mar 09

These latest figures take the DWP's central estimate of benefit fraud up from £860m six months ago to £1.1bn, with a range of £0.9bn to £1.5bn. Income support fraud is up £30m, pension credit fraud up £20m, housing benefit fraud up £50m, incapacity benefit fraud up £60m, and council tax benefit fraud up £10m. Fraud in the unreviewed category is marked down £20m - a net increase of £150m.

For instance, The government itself claims that benefit fraud by the relatively few claimants living abroad is running at £63m a year. That would reduce benefit fraud by people living in the UK to some £1.04bn.

On top of all this, a very conservative estimate for tax credit fraud would be £250m.

And the National Fraud Initiative identified probable fraud in council tax single person discount at a "cautious" £200m. The DWP have edged their figure up from £40m to £50m.

In Lambeth, use of voice recognition software identified over 18% of claimants as benefit cheats. As shown above, the government's national figure for housing benefit fraud is £260m (up from 1.2% to 1.5%). At 18% this would be over £3bn for housing benefit fraud alone!

The government figure for incapacity benefit fraud has leapt from £10m to £60m but it's still laughably small. One single sentencing session for single person benefit frauds in Merseyside identified frauds approaching £1m. That's just 21 claimants for one type of benefit in one authority area.

Two out of three claimants for the new employment and support allowance fail. If we cautiously assume that even one third of those on incapacity benefit should not be there, that alone represents a figure of £2.2bn.

How would cautious adjustments affect the benefit fraud total?

Government total

£1,100m

Tax credit fraud - add

£250m

Council tax single person discount fraud - if total £150m, add

£100m

Housing benefit fraud - for a cautious 5% fraud rate add

£600m

Incapacity benefit fraud - for a cautious 25% fraud rate add

£1,584m

Swansea council estimated that benefit fraud costs around £100 a household each year - over £2 billion nationally. Fraud Central - a partnership of the DWP and four scottish councils - remarkably says that "Benefit Fraud costs upwards of £2 billion per year". And it points out that

"Benefit Fraudsters not only affect Social Security benefits, they can have free prescriptions, free eye tests and free dental treatment costing the NHS millions of pounds per year."

But the truer figure - for benefit fraud alone - now looks closer to £3.5bn a year.