Page last updated at 08:49 GMT, Thursday, 15 May 2008 09:49 UK

Crackdown on public sector scams

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Almost 1,000 people were using disabled badges illegally

Scams and mistakes in the public sector are costing the country 10m and the total is expected to rise.

Spending watchdog Audit Scotland said a total of 9.7m was found to have been paid out as a result of fraud, overpayment, or errors.

This included 186 pensions being paid where someone was dead and more than 1,500 housing benefit cases involving public sector pensioners.

The findings emerged following a crackdown by public sector bodies.

Almost 1,000 disabled parking permits were cancelled when investigators found the holder had died.

Payroll frauds or irregularities were also uncovered.

One council found an employee had received 20,000 in sick pay over a two-year period - while working for a health board.

I am very pleased that more public bodies took part this time and that as a result, 9.7m of frauds, overpayments and errors were identified
Robert Black
Auditor General for Scotland

The scams were uncovered by the National Fraud Initiative, which formed part of the auditing process for 74 public bodies including councils, the police, health boards, the Scottish Public Pension Agency, and the Student Awards Agency for Scotland.

Information about dead people, public sector employees, pensioners, benefit applicants and others was scrutinised for "inconsistencies" and then cross-checked.

Officials said 49 housing benefit cases had already been passed on for possible prosecution and this number was expected to rise.

The investigation also led to 17 employees being sacked or resigning.

Authorities are trying to recover about 2.8m in overpayments, and will also save about 3.9 m by stopping pensions being wrongly paid out.

A previous exercise in 2004 and 2005 led to "at least" 75 successful prosecutions.

Successful prosecutions

Robert Black, the Auditor General for Scotland, said: "This is the second time the National Fraud Initiative has been carried out extensively in Scotland.

"I am very pleased that more public bodies took part this time and that as a result, 9.7m of frauds, overpayments and errors were identified."

One case involved a pensioner living in a nursing home.

He died in October 2004 but his pension was not cancelled until October 2007, by which time 25,000 had been overpaid.

Another case involved a council tenant who was working with the council while receiving benefit.

An interview revealed their partner was also a council employee wrongly receiving benefits.

The combined overpayments came to 100,000 and both are to be reported to the procurator fiscal.

Council support

An NHS domestic assistant was found guilty of benefit fraud after receiving housing benefit, council tax benefit and income support overpayments totalling 19,000.

And a retired police officer who claimed housing benefit without disclosing their occupational pension is awaiting sentence after receiving housing and council tax benefits of more than 17,000.

Local Authority organisation Cosla is supporting measures to stop fraud.

Its President Pat Watters said: "Local government obviously supports any measure which helps detect and reduce fraud in the public sector, thus ensuring that valuable resources are targeted in the most effective way and where they have the most impact.

"Councils are always striving to improve even further the quality of services they provide and every pound detected is a pound spent on frontline services for communities - that is why Cosla wholeheartedly supports this initiative."

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