Source · Select Committees · Public Accounts Committee
Recommendation 25
25
Accepted
Claimants received £4.2 billion less in benefits due to official error and unfulfilled eligibility.
Conclusion
DWP estimates that claimants received 1.6% (£4.2 billion) less than they were eligible for in 2023–24, up from 1.5% (£3.5 billion) in 2022–23. These underpayments comprised £1.1 billion in official error and £3.1 billion in unfulfilled eligibility.49 Official error is where a benefit is paid incorrectly due to action, delay or a mistaken assessment by DWP, a local authority or HM Revenue & Customs.50 Unfulfilled eligibility is where a claimant by error, omission or choice fails to provide accurate information or evidence to DWP about their circumstances and as a result receives less than the full amount of benefit they are entitled to. It was referred to as ‘claimant error underpayments’ by DWP until 2023–24.51
Government Response Summary
The government commits to introducing a safeguarding approach to challenge misconceptions and build trust regarding underpayments. It also plans to implement the Health Transformation Programme, including an optional online PIP service, to improve customer experience and make it easier to report changes of circumstances.
Government Response
Accepted
HM Government
Accepted
5.1 The government agrees with the Committee’s recommendation. Recommendation implemented 5.2 According to the latest national statistics, "underpayments” in the benefit system represent a small percentage of total benefit expenditure. The total rate of benefit expenditure underpaid in the financial year ending 2024 was 0.4% (£1.1billion), compared with 0.5% (£1.2billion) in the previous year. 5.3 The causes of unfulfilled eligibility are many and complex but trust in the department lies at the heart of the issue. Disability benefit customers have concerns that reporting changes will lead to reduction in entitlement, so many choose not to. There are also some who simply don’t recognise their needs have changed because their condition worsens slowly over a long period of time. Tackling the issue is not just a matter for the department. Wider discourse about disability benefits is bound to have an impact on perceptions which might drive increases in unfulfilled eligibility, making progress difficult. The department will continue to challenge misconceptions of its service and build trust, starting with the commitment to introduce a safeguarding approach. 5.4 Over the longer term, the department plans to deliver significant service modernisation through the implementation of the Health Transformation Programme, which will improve the experience of customers and help to rebuild trust in the department and confidence for customers reporting changes. The Programme will also make it easier for customers to provide updates. It is transforming the entire PIP service, including introducing an optional online service, which will eventually enable customers to apply, track and monitor their claim and inform the department of changes of circumstances.