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Mr. Smith: I notice that the Minister omitted to give us the crucial information, which is how many national insurance numbers are in circulation. I am sure that the Select Committee had a wonderful presentation, and that there was all sorts of reconciliation going on between all sorts of figures that the Government have come up with, but the Select Committee was not satisfied, and I am afraid that I am not satisfied with the Minister's answer. We ought to be able to ensure the tagging of an individual national insurance number to an individual identified citizen. It must not be beyond the wit of Government to produce a precise match.
Mr. Corbyn: Will my hon. Friend give way?
Mr. Smith: I shall not, because I must make progress.
Fifthly, the Government should end the "finders, keepers" rule between the Benefits Agency and the local authorities, because it leads to competition between them for the same fraudsters. It has on occasion led to Benefits Agency investigating officers sitting in court when local authorities prosecute fraudsters in order to note down names and addresses, bung them on to the computer and claim the saving for the Benefits Agency rather than the local authorities. I suggest that there are better things that investigators from the Benefits Agency could and should be doing with their time.
The system should state clearly that the Benefits Agency can claim savings when income support fraud is identified, and that local authority benefits agencies can claim the savings when housing benefit fraud is identified. There should be close liaison and co-operation between the two, rather than the existing absurd competition.
Sixthly, we could ensure that the Benefits Agency fraud figures are audited in the same way that local authority fraud figures are audited. We know the accuracy of the local authority figures, because they have to go through an auditing process, whereas those of the Benefits Agency do not.
Seventhly, we should tackle the issue of postal redirects. At the moment, if they are sending cheques to a particular address and the cheques are being forwarded to another address by the Post Office, the Benefits Agency and the local authority are not told about the redirection of the mail. We should allow local authorities and the agency to have a list of all redirected mail for claimants.
Eighthly, employment offices ought to inform local authorities automatically when claimants cease to claim unemployment benefit or jobseeker's allowance. That happens most of the time with the Benefits Agency and income support. It is still patchy across the country, but improvements have been made. However, there is no rule relating to employment benefit offices to say that, once someone comes off unemployment benefit or jobseeker's allowance, the local authority paying housing benefit must automatically be informed. Such a rule would assist the fight against fraud.
I have outlined eight specific things that the Government could do now to assist the fight against fraud. Yes, prevention, detection and deterrence are important. It is not only the claimants we need to be examining, but organised gangs, landlords and managing agents. Yes,we need innovative information technology and administration changes, but much more is needed than the Government envisage.
We need better support and liaison for local authorities from the DSS, the Post Office and the Employment Service. We need a commitment from the Government to stop making things worse. We need a serious tightening up on the issuing of national insurance numbers. We need a more secure and sensible approach to the issuing of benefit cards.
Mr. Ian Bruce (South Dorset):
I am grateful to be called so early in the debate and to follow the hon. Member for Islington, South and Finsbury (Mr. Smith). I did not think that I would be called so early and therefore felt a little trepidation at the prospect of having to prepare a response to Labour's eight stunning points. I am glad that no such response is needed because the hon. Gentleman cited a list of things that the Government are already doing. I therefore hope that at the end of the debate the Labour Front-Bench team will encourage their colleagues to vote with the Government and encourage the Government in their efforts to improve the tackling of fraud.
Although I am quite sure that the hon. Member for Islington, South and Finsbury is sincere in what he is saying and is trying to help, his statement on how Labour will tackle benefit fraud was absolutely pitiful and demonstrated that his party is bereft of ideas. Indeed, the fact that it has no other ideas for fundamental change emphasises that the Government's policies must be right.
Whenever I start a speech I always declare my interests, which are in the Register of Members' Interests. Indeed, I have been somewhat critical of colleagues for not having done so. Although none of the organisations that I advise has in any way helped with my speech or anything else, it is relevant to declare that I advise the Federation of Recruitment and Employment Services and the Telecommunications Managers Association. Some of the
remarks that I shall make are certainly as a result of the benefit of working with those organisations and knowing what is going on in the real world outside.
Mr. Corbyn:
How much do they pay you?
Mr. Bruce:
That is also stated in the register.
Mr. Bruce:
It is a matter of public record. I shall make my speech in my own way.
Whenever any of us talk to business men or others on their doorsteps, whether they be Conservatives, Labour, Liberal Democrats, Ulster Unionists or any others--I do not meet too many Ulster Unionists on doorsteps in my constituency--people are adamant that they do not want others to rip off the state. They know very well that that is ripping them off as taxpayers and they are very keen to ensure that we work as hard as possible to eliminate fraud in the system.
The man in the street is often somewhat dismissive of people who genuinely claim benefit. People who are genuinely in need of some benefit are attacked simply because of the fraud that is going on. It is therefore imperative that the House sends out a clear message about our determination to find the fraudsters.
I congratulate my right hon. Friend the Secretary of State on the success of the studies. It is impossible to identify all fraud accurately and exactly, but unless we make an effort to measure it sensibly, which the Government have done, the size of the problem cannot be determined and we cannot assess where it should be tackled. The usual Pareto analysis applies to fraud: if 10 or 20 per cent. of the problem is tackled, 80 or 90 per cent. of the fraud will be found. There is no point in spending £1 million if only £100,000 is saved. We must ensure that we spend taxpayers' money correctly in targeting fraud.
Many of the important areas identified by the hon. Member for Islington, South and Finsbury are clearly common ground across the Floor of the House. The reports produced by the Select Committee on Social Security demonstrate that we must all be aware of the issue and that we are all very keen that it is tackled.I congratulate the Labour party on not having any fresh proposals, on the basis that it clearly understands that the Government are going in the right direction.
The Government are right to emphasise that we have gone too far in withdrawing home visits and that we must find ways of checking up on people and discovering fraud. I urge my right hon. and hon. Friends to recognise that there are other simple methods by which we can find out whether people are defrauding the state. For instance, benefit claimants could be telephoned during the normal working day, perhaps after the children have returned from school. It is amazing how many young children answer the telephone and say, "Sorry, Daddy and Mummy can't come to the phone, they are both still at work." Such calls would determine whether people are working and claiming benefit.
Other methods, including letters asking for information, tend to make people who are defrauding the system nervous. If people are asked to give additional information
by letter, they think that somebody is checking up on them and decide to sign off, which is clearly what we are trying to get them to do if they are defrauding the system. People could be asked to call into the local office, especially at times when it would be difficult for them to get away from their jobs. We should remember that claimants would be travelling to such appointments in their own time and therefore such visits would be more easily accommodated by a genuine claimant than by an officer who had to make home visits. Those methods can and should be used much more. It is extremely important to use all possible flexibility.
I mentioned that I am an adviser to the Telecommunication Managers Association and I am a keen advocate of the use of information technology.I congratulate the Government on taking their first steps in that area. They are fairly tentative first steps, but there has already been some success. Data matching has been used very successfully in other countries. Australia, under new Labour, was one of the first. Perhaps if Labour had introduced data matching a little earlier it might not have been so whitewashed in the recent election.
The Government have been very supportive of the Post Office and sub-post offices over the use of information technology, and a number of companies and individuals have given presentations to some of our Back-Bench committees on how it will be used. The House might like to know that when somebody claims their benefit in future, postmasters will be connected to a computer in another area that will carry live information as opposed to all the intelligence being kept on a smart card.
Although that system is quite expensive, it is a very good way to check up on fraud and identify people who have lost an intelligent piece of information that could be used fraudulently. As soon as a loss is reported, the information can be immediately entered on the computer and the postmaster dealing with the claim can be alerted. That is beneficial, and I very much hope that information technology will be used successfully by the Department of Social Security.
I hope, too, that many of the benefits gained from using such a system will extend to other parts of the economy. The Government are large users of computing technology, and if they sign up to a particular type of technology and use IT, it will encourage other parts of the economy to do the same.
I echo some of the concerns expressed about the private finance initiative, which is a matter for the Treasury rather than for the DSS. As the guardian of public funds, the Treasury is keen to stop fraud, but it is somewhat over-bureaucratic--if not over-zealous--in the types of documentation that it requires. The DSS is working vigorously with would-be suppliers to get over the problems, but we should be aware of them and ensure that something is done to help.
I should be most grateful to learn how the new incapacity benefit is working in terms of weeding out those who have been defrauding the system. No hon. Member could oppose a disabled person who cannot work receiving help from the state. After all, if we are in Parliament for any reason, it is surely to help those who are most vulnerable. I do not want in any way to suggest that I am against ensuring that disabled people get suitable benefits--the Secretary of State and all Ministers are devoted to ensuring that they do--but it is extremely
important that people who are denied benefits because they have plenty of savings are not allowed to get a doctor's note saying that they are disabled and should receive incapacity benefit. We must carry out objective and sensible tests to ensure that claimants do not rip off the system.
One of my constituents--a vigorous worker for the Labour party and many other good causes--is energetic, is always rushing around and is happy to deal with her work. She often comes here to ask me to take up issues on her behalf. It was somewhat surprising, therefore, that when the Government introduced incapacity benefit she told me that she was worried about the new incapacity benefit. She had been claiming disability benefit for the past eight years, and was rather worried that the Government were going to take it away from her. I was able to reassure her that she had reached the cut-off age, and could not have the benefit taken away. But, frankly, here was someone receiving disability benefit who was, to my mind, as fit and able to work as anybody. She worked tirelessly for the community, the Labour party and many other organisations, but did not think that she was ripping off the taxpayer.
If people can work, they should be on the right benefit and should not try to claim incapacity benefit. By doing so, they may make a genuine claimant think that others believe that he is scrounging because, unfortunately,so many people in the past claimed the benefit incorrectly. I hope that we will hear how incapacity benefit is working in that regard.
I sat next to a number of people from the pharmaceutical industry at a dinner that I attended last night. When I referred to the subjects that the House would be debating this week, the issue of prescription forms was brought up. I know that such forms are not the direct responsibility of my right hon. Friend the Secretary of State, but he will know that exemptions from prescription charges are generally based on benefits.A lady at the dinner was quite adamant--as was the whole table--that the Government are not making sufficient checks on those who simply tick the box on the back of the form to state that they are entitled to benefits. They then sign their name, and their prescription is completely free.
I understand that someone who is found to be ticking the box incorrectly receives a polite letter from the health service asking him to send only the amount that he has defrauded the system. In other words, there is no disincentive for people to tick the box incorrectly and see whether anybody finds out. I understand that few checks are made on prescription forms, as they deal with a small amount of money but require a lot of clerical effort. The Government should look at that matter and ensure that people who incorrectly fill in prescription forms feel vulnerable to prosecution. We must, on occasion, prosecute fairly minor frauds to draw a line in the sand and to show our seriousness. We know how much the taxpayer pays towards prescriptions--some 80 per cent. of prescriptions are supposedly free. That figure may be boosted by some people claiming a false entitlement to free prescriptions.
All hon. Members will have had constituents coming to see them about the Child Support Agency and its funding. I do not wish to go into great detail about the CSA, and I suspect that my right hon. and hon. Friends will be grateful for that, but time and again parents with
care and absent parents are adamant that the individual whom they must pay or from whom they are receiving payments is defrauding the social security benefits system. Those parents often feel frustrated that, despite their passing information to the CSA, nothing is done about the complaint.
The Benefits Agency could target the CSA to deal with such fraud, resulting in an enormous saving to the taxpayer. In addition, those involved with the CSA may feel that they are being treated fairly. That is important, as people often complain more about being treated unfairly than about not having enough to look after their children. I urge my hon. Friends to look at the matter and ensure that information from the CSA gets through to the Benefits Agency.
Whenever I go to a village to canvass I always say hello to the local postmaster and ask what is happening. All of them know of at least one individual who is collecting a large amount of benefit to which he or she is not entitled. Most postmasters will inform the Benefits Agency of blatant cases, but they too are worried that the agency is not following up information. It is extremely important that there is such feedback.
When I am given information of an alleged benefit fraud, I can write to the Benefits Agency, which then gives me a full, but confidential, report on the case.I am duty-bound, however, not to pass on the report to the informant. All I can do is write to the informant to thank him for passing on the information, and assure him that the case has been fully considered.
An individual's right of confidentiality must, of course, be preserved, except when that individual is ripping off the system. If that person has had to pay money back or has stopped his claim, those facts should be available to the person who originally provided the information. That provides a bit of an incentive; it also prevents the situation from arising whereby someone says, "I have provided the information, but the individual seems to be carrying on as normal and I have received no firm information as to whether the claim is genuine."
I understand that often individuals will not be identified--whether or not they are receiving benefit--because that would break their right to confidentiality. But if there is a genuine case and we are ensuring that people are being found out, that information should be put in the public domain. The more that we put information in the public domain via newspapers, the better it will be for everyone because the climate will start to change. If we prosecute someone, the newspapers pick up the story and print it. We must consider how to get the information to the people.
I wonder whether we should examine one aspect of housing benefit to see whether it might be more appropriate to return it to the Benefits Agency's remit. It is important that the partnership--if there is one--between housing benefit offices and the DSS works well; it must be a seamless operation. If it does not work well and if we cannot continue to ensure that local authorities take action against fraud--as we have in recent years--we must consider the possibility of bringing the issue back under one roof. That is particularly important if the information that is available on the Government's computer systems cannot be shared around the housing benefit offices. It is important to ensure that the system is seamless and that we get rid of delays. People often tell
their landlord that they are receiving housing benefit. The landlord then decides that he will allow them to stay without worrying about the rent coming in at the right time as he believes that the DSS will eventually pay.We should be worried about long delays.
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