Page last updated at 23:06 GMT, Monday, 14 September 2009 00:06 UK

Council tax fraud costs millions

housing generic
Fraudsters claim to live alone to get a reduction in their council tax

English councils are losing almost £90m a year through fraudsters claiming the single person's discount on their council tax, says the Audit Commission.

The 25% discount can be claimed by individuals who are the only adult over 18 living at an address.

The spending watchdog also says an estimated 50,000 homes are not available to let to people who need them because of housing tenancy fraud.

It says councils should do much more to tackle fraud.

People falsely claiming to live alone are estimated to cost councils nearly £2 million a week, with other council tax payers meeting the cost of the 25% discount.

In its report, "Protecting the Public Purse", the Audit Commission says local authorities need to crack down harder on fraud and could save hundreds of millions of pounds.

"It has never been more important that councils fight fraud. Every pound lost to cheats is a pound that can't be used for people in real need", said the commission's chief executive Steve Bundred.

20.8m households eligible for council tax
7.5m get single person discount
300,000 households estimated to be falsely claiming
Source: Audit Commission

The commission also says that housing tenancy fraud has resulted in an estimated 50,000 properties being kept off social housing lists in England.

And it warns councils should be wary of fraudsters looking for jobs in town halls where they can then commit other types of fraud.

It urges councils to urgently reassess their counter-fraud plans, and ensure that staff understand, and have faith in, whistle-blowing arrangements.

Margaret Eaton, chairwoman of the Local Government Association, which represents local authorities in England, says councils are already working hard to tackle fraud.

"Councils are dedicated to bearing down on cheats to keep council tax as low as possible for the vast majority of honest, hard-working tax payers", she said.

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