Source · Select Committees · Public Accounts Committee
Recommendation 9
9
We challenged the Department on the adequacy of its quality assurance mechanisms.18 Despite the complexity...
Conclusion
We challenged the Department on the adequacy of its quality assurance mechanisms.18 Despite the complexity of State Pension entitlements and the increased risk posed by manual processes of calculating an award, the Department’s own internal analysis found that existing quality checks failed to identify the systematic underpayment of thousands of pensioners.19 There are three levels of quality assurance in State Pension. The quality of a caseworker’s work is assessed by team leaders (Tier 1) and by a central team (Tier 2). The rate of official error is assessed as part of estimating fraud and error across all benefits (Tier 3). However, as the NAO found, “since 2009, Tier 1 and Tier 2 processes focussed on checking changes to case details, such as a change of address or the death of a spouse, rather than the overall accuracy of the payments; and the small sample sizes of Tier 2 and Tier 3 relative to the basic State Pension caseload made it difficult to identify the errors”. In addition, conversations with caseworkers as part of the NAO investigation showed they feel that the Department has too few staff trained on State Pension processes to manage the caseload and perform the expected quality assurance procedures.20It is a fundamental principle of financial control and assurance that more attention should be focussed on those areas where there is intrinsically a higher risk of failure due to human error. The Department failed to apply this principle here even though it was aware of the system’s very high vulnerability to human error.
Government Response
Not Addressed
HM Government
Not Addressed
2.3 The department has strengthened its assurance methodologies, to ensure that associated sampling is more robust and picks up the widest range of errors possible for correction, using insight to inform organisational learning and continuous improvement plans. 2.4 All other assurance sampling is statistically significant. The department’s assurance was further strengthened in February 2021, and now involves reviewing cases as a whole, rather than just reviewing the change of circumstance processed. Further enhancements include segmenting assurance data that may indicate gaps in the knowledge of agents or other process or system errors that need rectification. 2.5 Part of the department’s risk management strategy is to manage risk not only by understanding errors of large scale but also smaller scale errors which present social consequences to customers. 2.6 A range of data sets will be triangulated to improve understanding of risks and will be reviewed 6-weekly at the department’s Quality Governance Board. The department will be happy to share its Quality Framework improvements with the Committee.