Source · Select Committees · Public Accounts Committee
Recommendation 3
3
Rejected
The success of the Department’s strategy to bring down fraud and error is dependent on...
Recommendation
The success of the Department’s strategy to bring down fraud and error is dependent on highly uncertain assumptions. The Department has set out its strategy to tackle fraud and error in Fighting Fraud in the Welfare System. This includes a £613 million investment in counter-fraud activities. The plan is dependent on the Department’s recruitment and training of enough people to implement its fraud counter-fraud activities in a difficult hiring environment, while simultaneously making headcount reductions in line with wider cuts to civil service staffing. The legislation needed to grant new powers the Department needs to deliver its counter- fraud strategy was not included in the Queen’s speech. Without new powers to access third-party data it will have limited ability to crack down on fraud driven by claimants misreporting the value of their savings or capital. The Department will be dependent on close cross-government working, including with the new Public Sector Fraud Authority, and is reliant on HM Revenue & Customs’ (HMRC’s) progress in collecting more timely information about self-employment earnings to address this driver of Universal Credit overpayments. Recommendation: As part of its Treasury Minute response, the Department should set out in detail how its counter-fraud plan would be impacted if it is not able to get the staff, powers or HMRC data that it needs, and what its contingency plans would be in these circumstances.
Government Response Summary
The government disagrees with the recommendation, stating that setting out detailed contingency plans for various scenarios is unnecessary and could distract from the delivery of its existing plan to reduce fraud and error.
Government Response
Rejected
HM Government
Rejected
The government disagrees with the Committee’s recommendation. In May 2022, the government published its plan to reduce fraud and error, focussing on three areas: • DWP frontline counter-fraud professionals and data analytics investment, • creating new legal powers to investigate and punish potential fraudsters and • bringing together the public and private sectors to keep one step ahead. The department received £613 million investment through Spending Review 2021 and Spring Statement 2022 to prevent an estimated £2 billion being lost to fraud and error by 2024-25. Autumn Statement 2022 funded an additional £280 million to deliver £396 million Annual Managed Expenditure (AME) savings by 2024-25. This will enable reviews of Universal Credit claims and cracking down on claimants and criminals seeking to abuse the system. The OBR forecast savings of about £9 billion by 2027-28 if this increased investment continues into the next Spending Review period. The government set out plans to legislate for additional powers when Parliamentary time allows and is expected to have additional impact on the OBR forecast. The department is seeking opportunities to clamp down on fraud across government. HM Revenue and Customs (HMRC) have shared information with the department about the Self-Employed Income Support Scheme, and together will continue to explore ways to tackle fraud across government. The department’s ARA will update on progress, new opportunities, and if need be, any contingency action being taken. Therefore, the department does not feel it is necessary or productive to set out detailed contingency plans for various scenarios at this point, which could distract from focusing on the delivery of its existing plan.