Source · Select Committees · Public Accounts Committee
Recommendation 11
11
The Department does not currently have a target rate of fraud and error for us...
Conclusion
The Department does not currently have a target rate of fraud and error for us to use to hold it to account. However, the Department does now “absolutely accept in principle” that it should have a target “given the level of public scrutiny and interest in the question of fraud and error in the DWP and benefits.” It told us that it was going to set a headline target of around 2.3% for 2020–21; this target appears to be for overpayments including State Pension which were at 2.4% (£4.6 billion) in 2019–20.20 However, the Department informed us that it reversed its decision to set a target for 2020–21 because it first needs to establish a “clear baseline” after the effect of COVID-19.21 This Committee has made several recommendations in recent reports for the Department to set fraud and error targets, not only at an overall rate, but for each benefit.22 This would allow for better scrutiny of the impact of the Departments’ initiatives and emerging new risks of fraud and error.
Government Response
Not Addressed
HM Government
Not Addressed
2: PAC Conclusion: Even before COVID-19, fraud and error overpayments were at their highest ever rates, with around £1 in £10 of Universal Credit paid incorrectly. 2: PAC recommendation: The Department needs to show sustained progress in reducing fraud and error. It should set annual targets, by risk and benefit, against which its progress can be assessed, based on its expectation of the intended impact of its counter fraud and error initiatives over time. These should be set out and reported against in its Annual Report and Accounts for 2020–21 For Universal Credit, the Department should set out its plan for year-on-year reductions in fraud and error, assessing performance against short-term, achievable targets. 2.1 The government agrees with the Committee’s recommendation. Ta rget implementation date: July 2021 2.2 The department had provisionally agreed to set an overall target for 2020-21, based on detailed fraud and error forecasts along with Universal Credit business case assumptions. The confirmation of this target was suspended with the onset of COVID-19. 2.3 The department is currently undertaking detailed sampling work in order to provide an estimate of the level of fraud and error in 2020-21. The focus will be primarily on reviewing Universal Credit as a priority, given the increase in the caseload and given the rates of fraud and error for Universal Credit. 2.4 The department anticipates that the COVID-19 pandemic will have impacted fraud and error levels, and this detailed analysis is needed in order to baseline the current position. The department is committed to publishing an annual target post COVID-19 pandemic, and to using the Fraud and Error Framework to drive fraud and error down to the lowest feasible level. 2.5 The department will publish its Fraud and Error results as part of its annual Statistical release. Following that, the department should be in a position to publish an annual target for 2021-22. The department will consider the viability of individual/lower level targets as part of this approach.