DWP issue benefit fine warning and say fraudsters will be prosecuted in court
The Department for Work and Pensions has outlined how benefit fraud will be prosecuted and who will be handed penalties.
The DWP says it will only be able to prosecute the "big" cases of benefit fraud due to court backlogs. The news comes as the new Public Authorities (Fraud, Error & Recovery) Bill was introduced in Parliament last week and forms part of wider plans to save the Government a total of £8.6b over five years.
The DWP estimates that benefit fraudsters cheated taxpayers out of £7b last year. In a recent evidence statement from the cross-party Work and Pensions Committee, DWP officials were questioned about the levels of fraud, which, according to government data, currently sit at around £9.7b a year.
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The levels of fraud within the system rose significantly during Covid, as rule relaxations in the early weeks saw overpayments of Universal Credit rocketed from 9% to 14.5% between 2019-20 and 2020-21. The DWP said the move was done so it could provide support to people who were vulnerable and needed it quickly.
Officials, however, admitted that this allowed criminals to exploit the system. Despite the current situation, officials said they were confident in their ability to eradicate fraud and return the issue to pre-Covid levels, but not until 2030, reports the Mirror.
Chancellor Rachel Reeves is warning of 'difficult decisions' ahead of expected DWP changes coming in March.
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Neil Couling, director general for fraud, disability and health at the Department for Work and Pensions, said: "Fraud is such a big volume that you can't prosecute your way out of this problem. So we are reserving our prosecutions for the most egregious, the big, organised cases. For individualised frauds, there is a series of administrative penalties we would apply rather than go to the courts, because the courts themselves are very busy with their own backlogs of prosecutions that they are trying to work through."
The latest data shows a backlog of 73,000 cases of all types waiting to go to trial at the crown courts. A House of Commons inquiry into the pandemic found a huge influx of Universal Credit applications, totalling 2.4 million within just three months.
Sir Pete Schofield, permanent secretary of the department, said: "There were some days where we had 100,000 people claiming in one day and we took a decision that it was a priority for the department to pay people and get people into payment which we were very successful at doing, but the result of that was that we saw fraud and error come into the system." In response, the government's plan is to hire 3,000 new enforcement staff to help prevent fraud and claw back cash.
MPs are also set to debate proposed legislation on Monday, February 3, which could see the government recover money from claimants' bank accounts and ban people from driving if they repeatedly fail to pay back what they owe. Alongside this, the DWP's organised crime investigators will be given new powers to apply to a court for search warrants. This means they will be able to support police, search premises, and seize items such as computers and smartphones as evidence against fraudsters.