3 Developing a systematic approach
to reducing error
14. The Department currently has a range of initiatives
under way to tackle error.[37]
For example, Jobcentre Plus has introduced an intervention specifically
targeted to identify and correct customer error in Income Support
and Jobseeker's Allowance cases. This initiative, which started
in June 2010, involves staff contacting customers to check for
undeclared changes in circumstances.[38]
However, the Department conceded that it does not have sufficient
information to evaluate whether it could get a better rate of
return on its investment in this intervention.[39]
15. The Department undertook cost-effectiveness assessments
of some interventions in 2009 in order to determine the return
from individual activities. The estimated cost of these interventions
was £23 million. On the basis of its analysis the Department
reported a saving of between £3 and £70 for each pound
spent, with data matching activities providing the greatest return
on investment.[40] However,
the costs included in the assessments were not complete or consistent.
Significant costs were omitted from the analysis, such as accommodation,
IT costs and other associated overheads, as well as the cost of
the work required to correct cases once mistakes had identified.[41]
The Department told us that it is now developing a more robust
approach using consistent cost estimates.[42]
16. In July 2009, the Department set up a Fraud and
Error Council to coordinate efforts to reduce error.[43]
The Council compiled a list of current and planned initiatives
to tackle fraud and error in March 2010,[44]
but the list did not contain complete or consistent information
on the cost and benefits of its interventions. The Department
conceded that it did not know which collection of initiatives
would deliver a sustained reduction in fraud and error.[45]
To rectify this, the Council has committed to a systematic review
by Spring 2011 of each of the benefits to understand the causes
of error and how they can target their interventions more effectively.[46]
17. In its recent White Paper, Universal Credit:
Welfare that Works, the Government set out proposals to replace
a number of existing benefits with the Universal Credit. [47]
This reform is expected to simplify benefit administration substantially,
thereby lessening the scope for mistakes to occur.[48]
As a result, the Department expects Universal Credit to reduce
losses from fraud and error by more than £1 billion per year
in the long term. It is not yet clear what proportion of the projected
savings is expected to come specifically from reductions in administrative
error, particularly since the Department concedes there will always
be some level of human error in the system.[49]
18. Implementation of Universal Credit is expected
to take some time, given the 'radical re-engineering' of the system
that it will involve.[50]
The Department plans to introduce the new regime from 2013 onwards,
and it could take up to ten years to implement fully.[51]
The introduction of Universal Credit is unlikely to be in time
to contribute much to the planned 25% reduction in fraud and error,
and in the meantime the Department should ensure it maintains
its commitment to reducing error through existing initiatives.
37 C&AG's report, Reducing losses in the benefits
system caused by customers' mistakes, para 2.9 Back
38
Q 167; C&AG's report, Reducing losses in the benefits system
caused by customers' mistakes, para 14 Back
39
Qq 22-23, 195 Back
40
Q 14; C&AG's report, Minimising the cost of administrative
errors in the benefit system, Figure 8, page 30; C&AG's
report, Reducing losses in the benefits system caused by customers'
mistakes, para 22 Back
41
C&AG's report, Minimising the cost of administrative errors
in the benefits system, paras 3.22-3.23; C&AG's report,
Reducing losses in the benefits system caused by customers'
mistakes, para 22 Back
42
Q127; C C&AG's report, Reducing losses in the benefits
system caused by customers' mistakes, para 22 Back
43
Q106; C C&AG's report, Reducing losses in the benefits
system caused by customers' mistakes, para 15 pg 8 Back
44
C&AG's report, Reducing losses in the benefits system caused
by customers' mistakes, para 21 Back
45
Q 167 Back
46
C&AG's report, Reducing losses in the benefits system caused
by customers' mistakes Back
47
Department for Work and Pensions, Universal Credit: Welfare
that Works, Cm 7957, November 2010 Back
48
Q 3, 186 Back
49
Q 55 Back
50
Q 10 Back
51
Qq 8-11 Back
|
