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The DWP's estimates for benefit fraud for 2010 - 2011 are here.
These latest figures take the DWP's central estimate of benefit fraud up to £1.2bn, with a range of £1.0bn to £1.6bn. Benefit fraud by the relatively few claimants living abroad is estimated to be running at £79m a year. That would reduce benefit fraud by people living in the UK to some £1.12bn. (So called "abroad fraud" would be an implausibly high 6.5% of total benefit fraud - suggesting that the overall total of benefit fraud has been pitched far too low.) On top of all this, a realistic estimate for tax credit fraud would be £1bn. In a jobseekers' allowance pilot in 2011, 20% of those ordered to take part in four-week community projects stopped claiming immediately and another 30% were stripped of their benefits when they fail to turn up. Now we clearly can't extrapolate a 50% fraud level across all jobseekers' allowance claimants, but let us cautiously add say another 4% - which seems very conservative. And the National Fraud Initiative identified probable fraud in council tax single person discount at a "cautious" £200m. The DWP have gradually edged their figure up from £40m to £50m and now to £60m. The NFA estimate that fraud in council tax discounts costs around £99 million. The most frequently claimed discounts are single person discounts, of which £92 million has been estimated as fraudulent. The NFA therefore estimates the total fraud in council tax discounts and exemptions at £131 million a year. However, sampling by a private firm suggests a total above £300m. 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 £290m. At 18% this would be over £3.8bn for housing benefit fraud alone! By December 2011 the housing benefit bill had risen to £22.4bn annually. The number of people claiming disability living allowance has roughly trebled since its introduction in 1992 and currently only 6% of claimants have their claim medically assessed by a specialist for the purpose of their claim. It seems a fair guess that the amount of fraud is significantly higher than the 0.5% the DWP currently claims. The DWP's budgetary guess is 20%. Let's stay far lower, at 5%. Retirement pension fraud is reported as Nil, yet the National Fraud
Initiative found £98m of pension fraud in England over two
years. Let's cautiously say £50m a year for the whole country. 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?
Fraud Central - a partnership of the DWP and four scottish councils - remarkably says that "Benefit Fraud costs upwards of £2 billion per year". But the truer figure paid out now looks closer to £6bn a year. This takes no account of the huge costs of social housing fraud. And as Fraud Central point out:
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