Benefit fraud crackdown after £8.4bn lost to false claims in a year
The Government is expanding its fraud investigation team following an 80 per cent rise in the number of false benefit claimants.
The Department for Work and Pensions (DWP) said £8.4 billion was lost in 2020-21, up from £4.6 billion the previous year, with the rise almost entirely due to fraud.
The department said it had increased the role of its integrated risk and intelligence service “in co-ordinating the monitoring of, and response to, fraud risks from individuals and organised crime groups”.
It will use funding provided in the Budget to expand its enhanced checking service, which looks at claims before they get to payment and is “retrospectively going over claims made during the pandemic to ensure they are accurate and will challenge those which are suspicious”.
The increase in the number of fraud detection measures comes after the number of people on Universal Credit, the main benefit, doubled to six million since the start of the Covid crisis.
The overall level of fraud and error across the benefits system also increased by almost two-thirds, from 2.4 per cent last year to 3.9 per cent – the highest-ever reported rate. The fraud rate on Universal Credit has increased by more than 50 per cent over the past year to stand at 14.5 per cent.
However, the DWP stressed that the vast majority of claims are genuine and the benefit provides a vital safety net for people in need.
It said a targeted attack on the benefits system had been made by organised criminals at the peak of the pandemic but was thwarted “by our techniques”, preventing £1.7 billion from being paid to people “trying to scam the system”.
“We cannot say too much on this as criminal proceedings are ongoing,” a government source said.
A DWP spokesman said: “Following an unprecedented year in which the number of Universal Credit claimants doubled as a result of the pandemic, fraud and error in the benefits system remains low with 95 per cent of benefits worth more than £200 billion paid correctly.
“We take any abuse of taxpayers’ money very seriously and those who claim benefits they are not entitled to will face criminal prosecution. We also have robust plans in place to recover fraudulent claims and drive fraud and error down to the lowest feasible level.”