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Friday, 16 February, 2001, 15:31 GMT
Benefit fraud costs taxpayer 1.3 billion
Job centre
Benefit fraud is still costing millions
Fraud and staff errors in Income Support and Jobseeker's Allowance benefits cost 1.3 billion last year, according to a report by the government's public spending watchdog.


The scale of fraud and error in these two benefits remains substantial

Sir John Bourn
According to the National Audit Office, the cash amounts to 8.4% of the 15.6 billion spent by the Social Security Department - or 1 in every 12.

The figure is down from the 1.4 billion overpayment recorded in the previous year.

Statistical blip?

But NAO officials said it was unclear whether this marked the start of a downward trend or was a statistical blip.


It is clear that they are still not keeping adequate records to keep track of the problem

Steve Webb, Liberal Democrat

NAO head Sir John Bourn said: "I am glad to be able to report the reduced level of estimated fraud and error in Income Support and Jobseeker's Allowance - and to draw attention to the initiatives being taken by the DSS and the Employment Service to make further improvements.

"Substantial fraud"

"Nevertheless, despite the encouraging progress that has been made by the department against the targets they have been set to reduce losses, the scale of fraud and error in these two benefits remains substantial."

Benefits Agency
1 in 12 lost to fraud
The DSS has a target of reducing losses through fraud and error in Income Support and Jobseeker's Allowance from a 9% level recorded in September 1998 to 8.1% by March 2002 and 4.5% by March 2006.

'Huge problem'

Liberal Democrat social security spokesman, Steve Webb, said the report showed benefit fraud was still a "huge" problem.

"The Government's attempts to quantify the levels of fraud is a big improvement on the Conservatives' failure even to measure it," he said.

"But it is clear that they are still not keeping adequate records to keep track of the problem.

"Talking tough on benefit fraud is easy. These figures prove that the Government's record does not match ministers' rhetoric."

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See also:

09 Aug 00 | UK
Benefit fraud 'costs 4bn'
19 Dec 00 | UK Politics
Benefit cheats face losing payments
27 Jul 00 | UK Politics
DSS 'bungles' fraud figures
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