Press Release - International benchmark of fraud and
error in social security systems
20 July 2006
The UK has levels of social
security fraud and error which are similar to those in comparable
countries, but the Department for Work and Pensions has a better
understanding than other nations of the problems and is doing more
to tackle them.
A report by the National Audit
Office, based on research carried out by RAND Europe, found that
fraud and error overpayments are a major problem for many
countries, but the UK is one of few to understand the scale of the
problem. The high levels of estimated fraud and error in
expenditure on benefits - £2.6 billion in 2004-05 – have led to the
NAO’s qualifying the DWP’s accounts and those of the former
Department of Social Security for 16 years in a row. But the
problems the UK taxpayer faces are mirrored overseas, in countries
such as USA, Ireland, Canada and New Zealand.
However, the DWP is ahead of
agencies in other countries when it comes to addressing these
problems. It is doing more to monitor and prevent customer and
offical error, at the same time as combating fraud.
The DWP has invested in
professional training for fraud investigators; introduced a
national anti-benefit fraud advertising campaign; increased the
capacity of the National Benefit Fraud Hotline to receive
information from the public about fraud; is working with other
Government departments to match information and data; and has
produced a risk profile to help identify claims which are more
likely to be fraudulent.
Internationally, there are many
common problems in social security fraud and error, such as illegal
working; document and identity fraud; and weakness of internal
controls. But, despite regular exchanges between some countries,
there is scope for improving mutual awareness of the problems and
developing possible solutions.
Although it is making progress in
reducing fraud and error, the DWP stands to gain from learning more
about novel approaches developed by other adminstrations. For
example, France and Australia are planning a central national
database for customer records, and Canada has achieved savings by
preventing fraud as a result of directing high-risk customers to
attend meetings with officials that provide them with information
about benefit programmes, their rights and obligations and the
Government’s control measures.
Given their progress in
understanding, controlling and reducing fraud and error, the DWP is
well placed to take the lead in encouraging the sharing of lessons
learnt in different countries.
Sir John Bourn said today:
“Social security fraud and error is a problem not only for
the UK, but also across the world. While we always want to see
further progress, the international picture tells us that DWP is at
the forefront in identifying, measuring and reducing this kind of
fraud and error. I am encouraged that it will be able to pass on
some of the lessons it has learnt, and gain from the experiences of
other countries.”
Notes for Editors
- RAND Europe is an independent not-for-profit policy research
organisation that aims to serve the public interest by improving
policymaking and informing public debate.
- Press notices and reports are available from the date of
publication on the NAO website, which is at www.nao.org.uk. Hard
copies can be obtained from The Stationery Office on 0845 702
3474.
- The Comptroller and Auditor General, Sir John Bourn, is the
head of the National Audit Office which employs some 800 staff. He
and the NAO are totally independent of Government. He certifies the
accounts of all Government departments and a wide range of other
public sector bodies; and he has statutory authority to report to
Parliament on the economy, efficiency and effectiveness with which
departments and other bodies have used their resources.
Press Notice 49/06
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