Social Security Fraud Bill [Lords]

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Mr. Steve Webb (Northavon): The amendment has another advantage. A single point of contact would make it much easier to scrutinise inquiries: we would know much more readily how many were being made and would have a much better prospect of checking that they were not being made inappropriately.

Mrs. Lait: Exactly, and that point leads me neatly to the other amendments, which provide for independent scrutiny of the request for information. The matter has been dealt with at great length in the Lords, but anxieties remain. It is unusual for the Conservatives to call in aid Liberty, but in this case we share some of its anxieties about privacy and the need to treat everyone equally. The British Bankers Association and the telecoms industry have also expressed anxieties.

Let us consider our own records held by banks, building societies or insurance companies. If one requests information from credit reference agencies, one sees the accuracy of the information held. When I requested my records, the only information that they could give me was that I was a member of the National Trust, which I thought neither obvious nor helpful in a credit reference. Such information may go much wider than merely what might relate to fraud. It is therefore sensible to ensure that as far as possible an independent check is made of whether the information required by the investigating officer is necessary.

The Minister of State and the Under-Secretary will recognise the technique used for some of the amendments that we have tabled, as we used it during consideration of the Child Support, Pensions and Social Security Bill. Some have been tabled to explore the potential and are contradictory. The source of independent scrutiny would under one amendment be a magistrate, but under another, be a court order. One of the amendments would provide a fallback provision, requiring specification in the Bill that the code of practice must be adhered to at all times. That is the least welcome proposal, but we hope that the Government will take on board the need for some form of independent check.

Here, we also get into joined-up government, because a number of issues cross over into the Taxes Management Act 1970, which insists on the obtaining of a magistrates court order before revenue officers can start an investigation. Liberty asks why suspected benefit fraudsters have less good protection than tax evaders, and one can only sympathise with that view.

The magistracy issue that emerged in the Lords was encapsulated by Baroness Hollis when she stated:

    ``Above all, we would be asked to produce to the magistracy the evidence we seek to establish''.—[Official Report, House of Lords, 1 February 2001; Vol. 621, c. 824.]

The BBA has examined that statement closely and contends that the reasonable grounds for believing would cover the person to be investigated. The Taxes Management Act would not require the whole case to go before the magistracy. We all recognise that to go to a magistrate and say, ``This is the whole case that we have'' when someone is trying to get information, is not the most practical way forward. The Taxes Management Act requires only reasonable grounds for believing. There is therefore, an independent scrutiny check in the Taxes Management Act that should be brought into this Bill.

We are also concerned that, without independent scrutiny, a mindset may develop, which causes people to say, ``This is the information we need and, therefore, whether it is germane to the case or not, we want to get it.'' The Government have been meticulous in trying to cover the problem in the code of practice and, as a result of the concerns that have been voiced, there will be checks in the system—management and national fraud investigation checks. An organisation could develop a mindset that leads it to acquiring information because it might be useful, whether or not it is germane to the case. That may be some years down the road, because it takes time for a mindset to develop, but without access to an independent check, we have a problem.

We do not mind whether a magistrate or a court order provides the independent check, but we believe in the necessity of a check such as the one that is already in the Taxes Management Act, in which the Inland Revenue must apply to the magistracy. We see no reason why similar safeguards should not be built into the Bill.

Mr. Webb: I support the thinking behind the group of amendments. I am attracted to amendment No. 14, which introduces the idea of a clearing house for such inquiries—that is how I interpret it. A single point of reference would make life a lot easier for those who have to supply such information. One can imagine certain providers of information having to deal with dozens of local authorities and different regional Benefits Agency sources. As the hon. Member for Beckenham (Mrs. Lait) said, given the turnover of staff, the people providing the information will need to be sure that they are giving it to the right person. It would be much better to have a single letterhead or signed e-mail—whatever the format may be—so that the people providing information know that the inquiry is genuine, has come from one place and has gone through the clearing house system. Dozens if not hundreds of local authorities may ask for such information, which will make life a lot more complicated for suppliers of information. I am therefore attracted to the clearing house idea.

I also support amendment No. 2, which provides the example of the consent of a magistrate. As the hon. Lady said, the BBA draws an analogy with Inland Revenue practice, whereby corresponding requests for information must come from a general commissioner. When I raised the issue on Second Reading, the Minister's response in his winding-up speech was, ``Our people are good people, they are well trained, they are sought after. Job adverts ask for people who are trained to DSS standards.'' Nobody questions that the vast majority of staff are well trained and good people, but to say that the safeguards are therefore unnecessary is a step too far. It is a little like saying that most Members of Parliament are decent folk and that scrutiny of their activities is therefore unnecessary. [Hon. Members: ``Hear, hear.''] The fact that there are a few rotten apples makes such scrutiny all the more important. It is interesting that Conservative Members do not echo that sentiment.

The fact that the majority of people are good and well trained is not an argument for lack of independent scrutiny. I do not understand why the Minister thought that that addressed the point. There might be a rotten apple, so making sure that people are not just working on the basis of a hunch but have genuine independently verified grounds for their inquiry is an appropriate safeguard. If it is good enough for the Inland Revenue, it should be good enough for the DSS.

Mr. Peter Atkinson (Hexham): I have come to this subject late, and I have not followed the debates in the other place. Therefore, I may be going over ground that has already been covered, although I hope not. I am trying to obtain from the Minister an indication of the scale of the operation. My hon. Friend the Member for Beckenham talked about the large number of local authority officers who might be involved, as well as other staff with such powers in the Benefits Agency and elsewhere. Will credit card companies be deluged with hundreds of inquiries in the course of a week? Alternatively, will such inquiries be relatively rare? Clearly, how the matter is policed and how it is scrutinised depends on the scale of the operation. Independent scrutiny becomes more important in relation to large-scale operations. Will the Minister therefore tell me what is envisaged?

The code of practice, of which my hon. Friend the Member for Beckenham has a copy, has not yet been seen by other Committee members. However, I know that the relevant section merely refers to management checks ensuring that the procedures are followed correctly. Clearly, doubt exists about whether that will be sufficient. One problem is that abuse will often not come from outside influences but from people within the administrative establishment.

A typical case dealt with by the Child Support Agency is of someone whose ex-partner is unemployed and pays little or nothing in maintenance, although, in fact, the ex-partner drives around in a new Mercedes motor car because he is fiddling the system. What would stop someone from the CSA talking informally with a Benefits Agency employee and asking him to do a fishing expedition to find out what the individual is getting up to? Would the police force be able to take advantage? Would a detective be able to look at people's bank accounts, which otherwise he could not, in order to find out more? These are some of my concerns. I would be grateful for further reassurance from the Minister about the scale of what is happening and how this cross-administrative fishing expedition might be properly controlled.

Mr. Rooker: I will do my best to answer the hon. Gentleman's queries. He should not get me wrong—they are legitimate questions and it is important that the answers are put on record. We must compare like with like, however. I do not accept the analogy of the Inland Revenue with the Department of Social Security or, indeed, the police. It should not be forgotten that the Inland Revenue has powers to approach third parties without getting anybody's consent to inquire about an individual. The DSS does not have such powers—nor are we seeking them. Section 20 of the Taxes Management Act 1970 requires the consent of an Inland Revenue commissioner; that is not done in open court, for example. I cannot support the idea of us having to seek consent in open court, as it seems to me unjustified.

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The powers of the Inland Revenue are far more intrusive than anything the DSS would seek. We could not go to a magistrate and say, ``We have reasonable grounds under the Act and want make such and such inquiries. Therefore, you should rubber-stamp it.'' Magistrates are there to exercise their judgment, so such a course of action would not be sufficient. We could not tell magistrates that we have signed a certificate stating that we have reasonable grounds and that, therefore, they could not exercise their judgment.

I turn to some of the points of detail. I do not say that hon. Members are casting aspersions on the integrity of DSS staff, but the underlying thrust of some of the questions is that those people cannot be trusted not to go on fishing expeditions and that their supervisors and managers cannot be trusted to ensure that the job is done properly.

People have also suggested that the training is faulty, but I do not accept that. There is a total of 5,000 investigatory staff in the DSS. We expect to sign up and authorise 175 to begin with; our expected total is some 300. Do not tie me down to the last five in those figures—but that is the kind of figure that we would predict. The Benefits Agency employs some 80,000 people—that gives hon. Members some idea of the scale of the operation—and 5,000 investigators. To start with, we plan to authorise 175 staff to work at 14 centres. There are 600 offices—there is a substantial difference between 14 centres and 600 offices.

Our present supervision of employees is rigid. Employees can fall foul of the Computer Misuse Act 1990 and the Data Protection Act 1998, as indeed they do. The hon. Member for Beckenham did not want to jump forward to consider clause 3, but my notes for amendment No. 38 to that clause contain some relevant figures. In 2000, we prosecuted 18 staff, downgraded three, 21 resigned and in 30 cases investigations resulted in dismissal. We actively supervise and manage our staff; their footprints are checked and, if they stay too long on a case on a computer, they are asked about it. Random checks are made to ensure that there are no fishing expeditions. We know how long inquiries should take in the Department and, if abuse takes place, we sanction our staff. Abuse is not ignored—dealing with it is a crucial part of our undertaking as public servants.

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