Source · Select Committees · Public Accounts Committee
Recommendation 22
22
Accepted
Widespread National Insurance record errors cause multiple underpayments, affecting 10 million Universal Credit claimants.
Recommendation
DWP now reports multiple underpayments relating to issues in the National Insurance record. In addition to the HRP underpayment, DWP has also identified that the National Insurance records for 10 million people claiming Universal Credit have not been updated properly. DWP estimates that 137,000 of these people have already reached State Pension age, and a smaller proportion may have been underpaid.46 We challenged DWP to explain what it is doing to make sure that underpayments relating to inaccurate or incomplete benefit records do not happen again. DWP explained that both the National Insurance and Child Benefit records are the responsibility of HMRC, but that DWP has an interest in making sure it has an accurate National Insurance record to pay the correct State Pension.47 It told us that it has commissioned a joint internal audit review with HMRC to look at how the National Insurance record is produced and whether there are any issues in terms of quality and assurance. It expects this to be complete by the end of 2023, and told us it will say more on this work in its next Annual Report & Accounts.48
Government Response Summary
The government agrees and commits DWP and HMRC to work together, engaging with a joint internal audit review, to provide assurance on the integrity of National Insurance records and their interaction with the benefit system by Winter 2024.
Government Response
Accepted
HM Government
Accepted
5a. PAC recommendation: DWP should work with HMRC to provide assurance to the Committee within the next twelve months over the integrity of the National Insurance records and how they interact with DWP’s benefit system. 5.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2024 5.2 The department and HMRC have agreed to work together on this, building on a strong existing relationship and established Director led Cross-Departmental Oversight for National Insurance Group. 5.3 The department and HMRC will set out the approach to assuring the integrity of the National Insurance record in relation to State Pension, in the first instance. This includes engaging with the joint Internal Audit review being undertaken by the Government Internal Audit Agency (GIAA) and HMRC’s Internal Audit team to help us ensure our control framework is effective.