DWP says ‘staggering' level of benefit overpayments due to fraud and error in welfare system
Nearly £10 billion in benefit overpayments were issued over the last year.
Reasons your Universal Credit may be cut by DWP
Data revealing more than £9billion is estimated to have been overpaid in benefits because of fraud and error has been branded 'staggering' by a UK Government minister. The latest official statistics said the total rate of benefit expenditure overpaid in the year to the end of March was £9.5 billion - with fraud accounting for most of that sum.
However, the new figures from the Department for Work and Pensions (DWP) also show that over the same period, an estimated £1.2billion was underpaid in benefits. Fraud accounted for £6.5 billion of the total overpayments figure in the year to March, down from £7.3billion a year earlier.
Claimant error was up year-on-year, accounting for £1.9billion in the year to March, from £1.6billion the previous year, while overpayments because of official error also rose to £1billion from £0.8billion the previous year. Overpayment of Universal Credit fell slightly to £6.35billion, from £6.41billion in the previous year.
DWP said people under-declaring their earnings remained the main cause of fraud overpayments, followed by benefits claimants failing to declare living with a partner, and thirdly people under-declaring their financial assets or capital.
The Department said it was able to recover some £1.1billion of overpayments in the past year - £0.4billion in Housing Benefit and the same amount in Universal Credit.
While the overall figure fell from £9.7billion in the previous year, it was still described as 'staggering' by minister Andrew Western.
In a written statement published alongside the figures on Thursday, he said: 'This Government made a manifesto commitment that it will safeguard taxpayers' money and not tolerate fraud or waste anywhere in public services.
'With welfare benefits paid to around 24million people, the welfare system is a deliberate target for both organised crime groups and opportunistic individuals and it is vital that the Government continues to robustly tackle fraud to ensure support goes to those who need it most.
'We are taking further steps to minimise error, ensuring the right people are paid the right amount at the right time.'
The figures came as the Public Authorities (Fraud, Error and Recovery) Bill moved to the House of Lords for its second reading on Thursday.
Its proposed reforms have been billed as delivering the 'biggest ever crackdown on fraud against the public purse'.
The Bill seeks to curb multibillion-pound benefit fraud and includes allowing the DWP to recover money directly from fraudsters' bank accounts.
It would also allow the DWP to have the power to obtain bank statements from people they believe have enough cash to pay back welfare debts but are refusing to do so.
Courts could also suspend fraudsters' driving licences after an application by the DWP, if they owe welfare debts of more than £1,000 and have ignored repeated requests to pay them back.
In the Commons, a group of Labour MPs rebelled to support an amendment designed to curb Government powers to verify a person's benefit eligibility.
And the Liberal Democrats warned the Bill could result in 'Orwellian levels of mass surveillance of those who have means-tested benefits'.
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