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Written Ministerial Statements

Tuesday 20 April 2004

ENVIRONMENT, FOOD AND RURAL AFFAIRS

Flood Defence Finding Review

The Minister for the Environment (Mr. Elliot Morley): On 12 March 2003 my right hon. Friend the Secretary of State announced the conclusions of our review of the funding and administrative arrangements for delivering a more efficient, effective and accountable flood and coastal defence service. A year on I want to update the House on the progress we have made towards implementing these conclusions, and outline what remains to be done.

We have set in hand arrangements for the Environment Agency to receive a single stream of Defra grant in aid funding from 1 April 2004. This will replace the previous mix of Defra grant for individual capital projects and, in large part, the levies previously raised through local authorities. This should provide the agency with more certainty of funding, allowing them to plan more strategically, while streamlining the procedures associated with implementing flood defence schemes. In future Defra approval will no longer be required for agency projects or strategies which are below £5 million though we will have the opportunity to call in strategies, and projects undertaken outside strategies, which are between £2 million and £5 million. We will also continue to ensure that the distribution of capital funding between the agency and other operating authorities (local authorities and internal drainage boards) is based on our priority scoring system which takes account of the number of people affected in relation to the cost of the project, the environment and benefit cost ratio.

Payment of grant in aid will be linked to robust targets in the agency's corporate plan. The agency may continue to raise limited levies on local authorities, agreed through flood defence committees on which local authorities have a majority, to fund locally important flood defence works beyond those covered by Defra funding. These local levies are set to raise some £24.4 million in 2004–05.

Work has also started on the procedures for transferring to the Environment Agency responsibility for those watercourses representing the greatest flood risk—the so-called critical ordinary watercourses. This will significantly improve accountability for flood risk with over 2,000 separate lengths of river identified for transfer. The necessary statutory procedures will start shortly with transfers taking place in stages until April 2006. Day to day management of the watercourses can be contracted back to internal drainage boards and local authorities where this is appropriate and agreed. As part of this exercise we are fully digitising the existing main river maps.
 
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The Government also announced the intention to move to a single tier of flood defence committee to remove the bureaucracy and second-guessing of decisions involved in having two tiers of committee in several Environment Agency regions. The Environment Agency has consulted on the proposed successor arrangements and I expect to receive their recommendations for future structures within the next month. I shall consider their proposals and bring forward orders as appropriate.

We have also made progress on a number of other important initiatives to help improve the accountability and delivery of the flood defence service. From 1 April 2004 internal drainage boards will fall under the jurisdiction of the local government ombudsman and we have developed a complaints procedure for individual boards to adopt.

We are also working with the Association of Drainage Authorities and the Environment Agency to develop new targets for the administration and membership of boards but in the meantime I am encouraged that arrangements are already being made for 16 existing boards to merge into three larger boards in the Anglia region, and discussions are taking place in other regions.

Jointly with the Environment Agency we have considered ways in which overheads associated with capital schemes can be reduced. We will be implementing agreed findings and targets for overhead reduction will appear in the agency's corporate plan.

We will be assessing the benefits realised through implementation of these conclusions as part of a three-year review which we will undertake in 2007.

Whilst the funding review conclusions are being taken forward, Defra is simultaneously leading work on a new Government wide strategy for flood and coastal erosion risk management to be underpinned by the principles of sustainable development. This is being taken forward in full consultation with stakeholders and will look across all Government policies. As part of the strategy we are undertaking further work on possible new funding streams to go alongside Exchequer funding which, as we announced last March, will continue primarily to fund the service. We intend that the new strategy will steer the direction of policy over the next 10–20 years and that it will be completed in the coming financial year.

Defra, the Environment Agency and others are putting great effort into implementing the funding review outcomes and developing a new long-term strategy. Implementing flood defence grant in aid from this April is a notable achievement and other substantial reforms to improve accountability and effectiveness will be in place in the next 12 to 24 months.

WORK AND PENSIONS

Benefit Fraud Inspectorate (Ealing Council)

The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond): On behalf of my right hon. Friend the Secretary of State for Work and Pensions, the Benefit Fraud Inspectorate (BFI) follow-up inspection report on London Borough of Ealing Council was published on 14 April 2004 and copies of the report have been placed in the Library.
 
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Following the housing green paper "Quality and Choice: A Decent Home for All", published in April 2000, the Department for Work and Pensions developed a performance framework for housing benefits. The "performance standards for housing benefits" allow local authorities to make a comprehensive self-assessment of whether they deliver benefit effectively and securely. They are the Standards that the Department for Work and Pensions expects local authorities to aspire to and achieve in time.

The BFI inspected London Borough of Ealing Council against the Performance Standards for housing benefits. The report finds that the council is not at Standard for any of the seven functional areas of the Performance Standards—strategic management, customer services, processing of claims, working with landlords, internal security, counter-fraud, and overpayments.

However, the report finds that the council had made sustained improvements in a number of areas since the first BFI inspection report published in December 2000. The council:

had significantly reduced its backlog of work from 46,000 items to 4,000; was processing housing benefits claims faster; had reduced the amount of time that customers wait when they make an enquiry by telephone or in person; had reduced the number of complaints and increased the level of satisfaction reported by customers; and had prosecuted more benefit fraudsters.

Weaknesses still remained in the controls for internal fraud and for recovering overpayments of benefit. The council still needs to do more to better manage its counter-fraud effort and, in particular, to deter fraud.

The council had improved its processing times for new claims to benefit and changes of circumstances, taking an average 51 days to process claims and 15 days to process changes of circumstances compared to the national standards of 36 and 9 days.

The council had carried out a number of good quality fraud investigations. During 2002–03, it had prosecuted 18 fraudsters compared to one during 1999–00 putting it in the top 25 per cent. of performers compared with the other London boroughs.

In 2002–03, London Borough of Ealing Council administered some £121.2 million in housing benefits, about 18 per cent. of its gross revenue expenditure.

The report makes recommendations to help the council address weaknesses and to further improve the administration of housing benefit and council tax benefit, as well as counter-fraud activities.

My right hon. Friend the Secretary of State is now considering the report and will be asking the council for its proposals in response to the BFI's findings and recommendations.

Benefit Fraud Inspectorate (Leicester City Council)

The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond): On behalf of my right hon. Friend the Secretary of State for Work and Pensions, the benefit fraud inspectorate (BFI) inspection report on Leicester city council was published on 15 April 2004 and copies of the report have been placed in the Library. Following the housing green paper "Quality and Choice: A Decent Home for All", published in April 2000, the Department for Work and
 
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Pensions developed a performance framework for housing benefits. The performance standards for housing benefits allow local authorities to make a comprehensive self-assessment of whether they deliver benefit effectively and securely. They are the standards that the Department for Work and Pensions expects local authorities to aspire to and achieve in time.

The BFI inspected Leicester city council against the performance standards for housing benefits. The report finds that the council is not at standard for any of the seven functional areas of the performance standards—strategic management, customer services, processing of claims, working with landlords, internal security, counter-fraud and overpayments.

However, the report notes the considerable efforts made by members, senior officers and staff over a sustained period of time.

The report finds that the council had a backlog of around 14,500 cases, poor IT reliability, insufficient management information which together with limited planning had hindered the council's ability to deliver an effective benefits service. This had resulted in new benefit claims and changes of circumstances taking 141 days and 49 days to process during 2002–03.

Although processing times were taking too long, the quality of processing and verification of claims was found to be of a good standard. However, the lack of effective management checks meant that the council had only limited assurance that benefits were being paid correctly and securely. Also, customers were experiencing problems trying to access the benefits service by telephone.

The quality of fraud investigation work was good and all investigation officers were trained to professional standards. However, limited resources and weaknesses in the planning of investigation work were undermining efforts to secure the benefits system.

In 2002–03, Leicester city council administered some £97 million in housing benefits, about 16 per cent. of its total gross revenue expenditure.

The report makes recommendations to help the council address weaknesses and to further improve the administration of housing benefit and council tax benefit, as well as counter-fraud activities.

My right hon. Friend the Secretary of State is now considering the report and will be asking the council for its proposals in response to the BFI's findings and recommendations.

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