My blog yesterday covered one part of Universal Credit but this one is where Lord David Freud was present on 7th April. This also means another long Blog.
Lord Freud, Minister for Welfare Reform, and Mike Driver, Finance Director General, Department for Work and Pensions, Mr David Gauke MP, Exchequer Secretary, HM Treasury, and Nick Lodge, Director General, Benefits and Credits, HM Revenue and Customs
Watch the meeting.
There was twice as much error was discovered in the system and when the Chair Dame Anne Begg pointed this out, they seemed unperturbed by this but attempted to explain the process in ways to address this matter.
The Latest figures for fraud and error given by minister David Freud were as follows;
Fraud and Error Monetary Costs 1.2 billion
Claimant 1.6 billion
Official 8.0 billion
Yet daily we hear of all this fraud but little about error which is being used to demonise claimants as ‘all on the make’. The committee chair did point out why was the emphasis on fraud when 2/3rds was error. Is the 1.2 billion monetary costs caused by an anomaly or is that overall? One thing Lord Freud explains is ways in which they plan to address it by introducing 4 main points across UC & PIP, They are as follows to help you understand processes being put in place;
- Simplification of process of UC & PIP
- IT/Data Sharing using (RTI (real time information) and Atlas (http://thefedexperts.com/post/22124968271/government-consulting-services)
- A New Quality Framework (making sure information is consistant and accurate)
- Case Cleansing (this means they take caseloads and cleanse it of fraud and error ) ie: overpayements for example
Secondly they are looking at Claimant Error
- Claimant Error (Making sure Government information is in plain english and communicating what is required)
- Centralising (Communication Products)
- Awareness Messages
- Introduction of Civil Penalties £50 fine
When the committee asked why so much emphasis was on fraud when the committee felt the department should be focussing on top priority of error of 8 billion as it was highest cost, the treasury minister went on to explain figures of tax credit overall expenditure 2011/12 was 3.0% error overall.
Claimant Error 4.2 %
Official Error 0.1%
At the moment this only affects Carers and JSA groups but will affect others when it comes to the roll out.
The breakdown figures for both groups;
Anne Begg challenged the perception of public view on fraud which they admitted across depts is 0.7% being lumped together is deceptive, yet public perception is that fraud is rife in system, yet error which looms large 34 times higher than fraud is in actual fact not being fairly reported. She suggested that maybe they should be separated which they denied should happen, maybe that doesn’t fit government rhetoric to indoctrinate the general public into backing their reforms if they knew the truth. Minister Glenda Jackson MP also asked why particular the DWP presented the argument to public using ‘Black Propaganda’ that fraud was running amok while in actual fact error is worse, not only did she dare say this but called Lord Freud , Lord Fraud (Freudian slip) much to the raised eyebrows in the room of the committee but to the amusement of the nickname given him by activists. Social media was alight with this faux pas. She also brought up his conjucture that the complication of forms and the departments system on delivery to claimants was erroneous, causing misery to many and surely it should be changed, he responded by saying many drift into fraud. She argued that he didn’t answer her question , in that it is the responsibility of the department to make sure the greatest misuse of public money which is in error, not fraud and therefore the department is as culpable as the claimant itself in falsely claiming statistically they were misleading the public into believing that fraud was the greater misuse of public money. on this Glenda has my vote for ‘getting it’, but Lord Freud said he would have to beg to differ on that point. The sheer arrogance of the minister in his dismissal to her fair and valid question. The chair did not force him to answer the question which is what he is there for, which was disappointing to say the least.
The public view against claimants is appalling and perpetuated by the rhetoric being spun by ministers & celebrities who misuse the fact to suit the agenda, the latter depending which party they follow and donate too. Most claimaint’s would work if they could, but sadly the painful truth is most of them even with support cannot, which is down to the fact they are too sick or disabled to do so, the mind is willing in most cases the body isn’t. Claimants & Campaigners and the public are waking up to realise they are being hoodwinked by politicians and the media when the realities on ground are plain to see. While the backlash of those in power caught with their hands in the overflowing cookie jar of capitalism is gaining some momentum. The public are treated as if they are stupid when the reverse is true. When they can’t get care for an elderly relative at home or hospital, or they are treated like criminals for making a mistake on a claim form being classed and labelled as a fraudster then the reality of it is, the word is spreading like a bush fire and it can only come to discord on the streets which I believe will be worse than previously seen around UK a few years ago. Politicians need to realise this will come to the fore, and to be frank I think this is what a driving factor behind it is, they know if they push people enough it will cause untold misery and give the government an excuse to crackdown on Joe Public further stripping away their human rights and say I told you so, while those barricading themselves in their homes from the riotous behaviour going on outside. Fraud to me is a deliberate attempt to gain from something, not a mistake which they call low level fraud., which is classed to error.
Lord Freud went on to say that the government has an elaborate measurement of fraud and error and one the best systems in the world. Nick then went on to say in his dept tax credit expenditure is higher than they would like it to be but at 7.3% it had actually come down in real terms. This is individual fraud statistic rather than organised fraud by large groups of people.
The methodology measures used were
- Under declared occupational pension
- Living together
- Fraud Abroad
Joint strategy budget for new measures of 425million in 2015
- Actual Money 286 million
- Savings to be made 1.93 million
Measures to get people to use the fraud line of DWP, have got financial incentives to those whose give information which result in a claimant being caught and removed from the system and monies reclaimed are still in place in the strategy report as the chair queried if they had been dropped ,which she was told they had not. Work is also being done with Crimestoppers to address this and is on going.
Incentives to combat fraud in place is by means of making information of what is required plain and clear to declare. the HMRC targets 5.1/2 % reductions of fraud and error is what they are looking at. DWP targets are x2 hopes 1.7% reduction in 2014/15 the business case on targets are on delivery with the hope it will plateau at 2.1% MFE of which data will be published in June. The Single Fraud and Error Service is investigations into fraud being brought under one roof and funded accordingly as a single unit, and at present no benchmarking is done between depts in public sector & private sector.
The next question raised by Glenda Jackson was on the excessive data sent to LHA using Atlas and that they had reported that they had to wade through loads of data to find what was needed in case of Housing Benefit when assessing a claim Glenda asked if it was going to be streamlined , Mike Driver stated he wasn’t aware of this but would tell his team so they also went on to talk about automated systems and the emphasis on consistency and data matching across the systems involved ie Atlas. She asked Mr Driver why it was that overpayments of Housing Benefit (HB) was twice as much as it should be and therefore is resource intensive both monetarily and labour wise using Atlas and could they not incentivise to reduce Fraud and Error the subsidy is reduced to 40% by LHA’s, if they identifiy fraud or error and recover the amounts they are given up to 140% subsidy the rest goes to treasury rather than LHA’s. Under Universal Credit the responsibility for HB will go to DWP and LHA’s have raised concerns about the cross matching of data they share between other authorities and how that will impact on those claiming HB. The Intergrated Risk Intelligence Service (IRIS) which is used by Government she asked if that had been removed, redesigned or still in place? Lord Freud stated it had a data matching service which was in place for live service (although it wasn’t in UC pilots) and they are developing IRIS in where they are splitting it up into 4 ways
- Information confidence
- Analytical Hub (RTI)
- Session in Confidence (Security Division Risk Assessment)
Only JSA are at present been involved in pathfinders for UC. Anne Begg interjected to ask how DWP was going to intergrate LHA info on property and local information to UC. Anne Begg highlighted a issue of how if you have 4 flats on left all with same number 26 on a floor compared to 4 flats on right having same number 27 , how would the DWP data match those to make sure a claim wasn’t fraudulent? Freud waffled his way through facts that the DWP ‘look to get’ not the will have local knowledge and housing data to cross match like LHA’s do at present, under the UC system if and when it rolls out. He said that at the moment those housing officers will continue to be in HB dept’s for some time while the rollout continues. The question by Graham Evans MP asked with the cross party support of a Single Investigation Unit (SIU) and asked how the concerns of LHA’s were worried they would lose some experienced fraud investigators especially in corporate area which Freud stated they wouldn’t lose those in corporate teams, and that funding was made available to them to enhance that team to deal with corporate fraud. Most Investigators in large authorities will be absorbed into the SIU and smaller ones will not lose any staff who may cover a wide range of fraud investigations across all fields. Stats on investigators to transfer are around 800.
When Mr Evans asked about UC rollout the next batch is June 2014 and then they take a break until October 2014 which they then expect will take 18mths and by 2016 the rollout should have completely ironed out any glitches in the system by March 2016.
Sheila Gilmore MP then went on to ask who is verifying tenancy agreements and leases in regards to UC & HB And Freud said they are talking to LHA’s which is on going, and that so when a claimant applies for UC that info is sent to UC and then verified by the LHA ,as where what is level of checking that’s needed . The HB system has been stripped down to cover all the needs according to Lord Freud, he also said the concerns she raised were not in the social rented sector so one can assume it is in private rented sector where the level of fraud and verification is needed the most.
Identity Assurance for UC is being implemented under UC and that this will ensure who is on the end of phone or in office is who they state they are. Freud stated that a Cabinet Office led program being developed around the IT system in regards to face to face and telephone systems to create a process across all government departments and beta sites are in place. when Gilmore brought up biometric such as voice recognition will not be persued at this stage. The information as it comes in will be monitored by a security service type application where risk and threat of fraud will be monitored 24/7 that will be adapted into UC. Red Flags trigger visits within the system, whereas green flags will be simple straight through process through a automatic system. Conditionality groups (Jsa,Wrag) can be seen or monitored by attending JCP for instance and they can be called in more often if need be. the analytics hub will stop this abuse and before it gets into the system. 400 million savings are expected from this approach across the departments, earning checks will be done across all benefits as this rolls out. RTI is already showing benefits in flagging up potential problems. she asked how those not on monthly payments how would the adjust for that and the ministers said that could be achieved. self employed will have to self report along with a few others monthly. he said he didn’t want debt and fraud building up. they have also ramped up civil penalties to 50,000 per year.
No doubt this will become clearer as time rolls on as to whether or not this actually works or indeed gets off the ground given the train crash it appears to be with database matching and RTI systems that thye put in place.