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National Audit Office report: Northern Ireland National Insurance Fund Account 2003-04

Northern Ireland National Insurance Fund Account 2003-04

"I hope that further improvements by the Department for Social Development in reducing errors by officials and providing more up to date information on levels of fraud and customer error will enable me in the near future to lift the qualification of this account."

"I hope that further improvements by the Department for Social Development in reducing errors by officials and providing more up to date information on levels of fraud and customer error will enable me in the near future to lift the qualification of this account."

Sir John

 

The Northern Ireland Department for Social Development has succeeded in significantly cutting the estimated amount of benefits paid incorrectly because of errors by officials. The Department estimates that, for benefits paid in 2003-04, overpayments and underpayments amounted to £13.4 million and £5.0 million respectively – down from £51.9 million and £5.5 million in 2002-03. However, head of the National Audit Office Sir John Bourn has qualified the Northern Ireland National Insurance Fund Account once again because the estimated level of error is still high.

According to today’s report to Parliament, in previous years the Department had experienced some problems with storage facilities and in recovering papers and evidence for audit purposes, particularly in older cases picked for checking. In such cases “deemed” errors were recorded until the evidence was produced, although the payments might ultimately have proved to be correct. This had the effect of inflating the estimated level of error.

Following the National Audit Office’s qualification of the 2002-2003 account because of the unacceptably high level of error in benefit payments, the Department took immediate and decisive action to ensure that, for 2003-2004, all papers requested for checking were delivered. This, together with improvements in the accuracy of decision making on benefit claims by the Department, significantly reduced the level of estimated errors.

Despite the positive and successful action taken by the Department to reduce the levels of estimated overpayments of benefit due to fraud and error and also underpayments, the extent of estimated over and underpayments remains a material sum and Sir John qualified his audit opinion because of this.

From time to time the Department carries out Benefit Reviews, which seek to identify the total monetary value of errors by officials and customers, and overpayments due to fraud. The last such review of Retirement Pension was carried out in 1999-2000 while the latest review of Incapacity Benefit was completed in 2002-2003. Although these reviews identified the existence of both customer error and fraud, the small number of cases reviewed where errors or suspected irregularities were found meant that it was not possible to calculate an accurate figure for each category of error and for fraud,

 

Publication details:

ISBN: 0103284524 [Buy a hard copy of this report from TSO]

HC: 198 2004-2005

Published date: February 9, 2005