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Merthyr Tydfil County Borough 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 Merthyr Tydfil county borough council was published today 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 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.

In 2002–03, Merthyr Tydfil county borough council administered some £11 million in housing benefits, about 10 per cent. of its gross revenue expenditure.

BFI found that Merthyr Tydfil county borough council was providing a poor benefits service and was not at standard in any of the seven functional areas of performance standards.

BFI reports that there have been some improvements in the benefits service following a critical Corporate Governance Inspection by the Audit Commission in Wales in January 2003. However, significant work remains to be done to deliver an effective and secure benefits service.

The report notes a lack of strategic and operational planning in the benefits service that left it without direction. Insufficient and inaccurate management information and limited reporting arrangements meant that senior management and elected members were unaware of the extent of the problems affecting the service.

BFI found levels of inaccuracy to be 90 per cent. for new claims processing and 75 per cent. for changes of circumstances. The council also had a poor record
 
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of recovering overpayments and the absence of management checks and controls meant that performance was not properly monitored.

The council had carried out a number of good quality fraud investigations but had not followed all through to a logical conclusion resulting in only 11 prosecutions between April 2001 and March 2004.

The council recognised the need to improve the service and has asked for help from the BFI's Performance Improvement Action Team.

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.

Chester-le-Street District 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 Chester-le-Street district council was published today 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 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.

In 2003–04, Chester-le-Street district council administered some £11 million in housing benefits, about 34 per cent. of its gross revenue expenditure.

In June 2004, BFI carried out an inspection of Chester-le-Street district council and found that the council was not at standard in any of the seven functional areas of performance standards. Overall the council is providing a fair level of service.

The report notes that the council has made progress in addressing some of the weaknesses BFI highlighted in the comprehensive performance assessment that took place in October 2003 when BFI considered the benefits service to be providing a poor performance. It can now demonstrate how the service contributes to the council's corporate aims, it has cleared its claims backlog and is achieving upper quartile performance for claims processing.

However, there are still several issues that the council needs to address. There is no performance monitoring at a corporate level and the benefits service has not developed specific performance measures and targets to facilitate the monitoring of progress towards its objectives. The service's objectives are not prioritised and there is no link between these and individual job descriptions.
 
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The council's high level commitment to provide an effective benefits service is not adequately reflected in its operational planning and staff development. Staff training needs have not been assessed and there is no training programme in place. Job descriptions fail to reflect current duties and consequently, lines of responsibility have become blurred.

The BFI reports that counter-fraud performance has suffered because attention has been focused on claims processing. This has resulted in insufficient resources and a lack of effective counter-fraud measures.

The council has developed a service improvement plan and there is now an effective electronic procedures manual to guide staff. Verification procedures are strictly followed and the council has introduced a claim form based upon the Department's claim form.

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 BFFs findings and recommendations.

City of York 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 the City of York council was published today 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 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.

In 2003–04, the City of York council administered some £29 million in housing benefits, about 11 per cent. of its gross revenue expenditure.

BFI found that City of York council was providing poor benefits service and was not at standard in any of the seven functional areas of performance standards.

A best value review of its revenues and benefits services had resulted in a revised organisational structure and the implementation of a new benefits IT system in September 2003. City of York council said their difficulties with the implementation were the main cause of a backlog of work building up and this adversely affected its performance. In particular, its performance for processing new claims was very poor, taking an average of 81 days.

The report notes key management disciplines of planning, target setting, monitoring and control, checking and assurance testing were inadequate. Limited management information was obtained but only some was used effectively to manage performance.
 
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BFI reports that the quality of verification of evidence to support claims was of a good standard. However, inadequate management checking meant there was insufficient assurance that the benefits system was secure or that benefit was being paid correctly. The report raises concerns about failures to comply with key legal requirements of housing benefit and council tax benefit legislation.

The council did not keep reliable records of customer complaints and many appeals remained outstanding for long periods.

The benefits service had failed to respond to internal audit recommendations and public accountability was being compromised by inadequate arrangements for reporting audit activity and performance to elected members.

The report notes serious failings in the recovery of overpayments. City of York council was recovering overpayments even though customers had not been advised of the overpayment decisions.

The council's efforts to counter fraud were more positive and it had achieved some impressive results as demonstrated by the full range of sanctions being applied and every case submitted for prosecution had been successful.

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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