BBC Home
Explore the BBC
BBC News
Launch consoleBBC NEWS CHANNEL
Last Updated: Tuesday, 18 January, 2005, 17:50 GMT
Benefit fraud and error cost 3bn
Calculator and coins
This is the 15th year that the audit office has found fault
Little progress has been made in cracking down on benefit fraud and error, a spending watchdog has said.

The National Audit Office (NAO) found that about 3bn or 2.8% of overall spending on benefits and job programmes was lost to fraud and error in 2003/4.

Figures show the same amount was lost in the two previous years.

The Commons' Public Accounts Committee will question officials from the Department for Work and Pensions in March about the report's findings.

Still too high

Sir John Born, auditor general and comptroller, acknowledged that fraud and error had fallen but he said that overall the level was still too high.

"The challenges the Department faces in reducing the scale of fraud and error across the benefit system to an acceptable level still remain very large indeed," Sir John said.

He added that this was the 15th year in a row he had "qualified" the accounts of the DWP and its predecessor, the Department of Social Security.

Qualifying the accounts is an accounting term, which refers to the fact that a significant sum of money has been used for purposes that "Parliament did not intend".

Sir John has previously said that he would give the DWP's accounts a clean bill of health if it reduced benefit fraud to 1% or 1bn of expenditure.

Benefit flood

The DWP spends 109bn on benefits and employment programmes each year.

Income Support and Jobseeker's Allowance as well as Housing Benefit are most at risk of fraud and error, the NAO said.

Fraud and error in Income Support and Jobseeker's Allowance costs taxpayers 840m or 6.4% of expenditure, down from 920m in the previous year.
An annual overall loss of 3bn is a grievous waste of public resources
Edward Leigh MP

Fraud and error in payments of Housing Benefit, which is paid by local authorities but administered by the DWP, cost 650m or 5.3% of total spending.

Edward Leigh MP, chairman of the House of Commons' Public Accounts Committee, said the DWP had made some progress on benefit fraud.

"The flood of benefit money being lost as a result of fraud and error is not abating...the fact remains that an annual overall loss of 3bn is a grievous waste of public resources," he said.

Since 1998, more than 1bn of taxpayers' money has been saved by improvements in procedures, a spokesman for the DWP said.

"Much is being done to tackle official error levels. The incidence of error is continuously monitored and improvement targets are set," the department said in a statement.

The BBC is not responsible for the content of external internet sites


News Front Page | World | UK | England | Northern Ireland | Scotland | Wales | Politics
Business | Entertainment | Science/Nature | Technology | Health | Education
Have Your Say | Magazine | In Pictures | Week at a Glance | Country Profiles | In Depth | Programmes
Americas Africa Europe Middle East South Asia Asia Pacific