Reducing errors in the benefits system - Public Accounts Committee Contents

Supplementary evidence from the Department of Work and Pensions


1.  At the PAC Hearing on Customer Error on 1 February, I agreed to write in response to questions from Mr Hancock and Ms Creasy on arrangements for visits to new claimants to Disability Living Allowance (DLA), and underpayments arising from customer error.

2.  Mr Hancock asked whether customers making a new claim to DLA were routinely visited. We do not routinely visit customers at the new claim stage as DLA claims are based on a self-assessment by the customer. However, the decision maker can request a range of additional evidence to help assess a new claim, including information from the customer's health care professional (eg the GP, hospital). Decision makers are also able to request that a health care professional visits the customer to provide an independent medical opinion where appropriate. There is, though, provision for local services to visit customers at their request to help complete claim forms.

3.  The Government's current consultation on DLA reform looks specifically at the assessment stage of a new claim, including the possibility—in the future—of a face-to-face meeting for all new claims.

4.  While we estimate the amount of fraud and error in DLA, we do not presently estimate how much is attributable to the initial claim. However, I have asked analysts to consider how we might be able to develop that data for the future.

5.  Separately, Ms Creasy asked if there was a target to reduce underpayments, and the budget to do so.

6.  We do not have a separate target to reduce underpayments, although we do routinely measure (and set targets for) the accuracy of decisions. Of course, the initiatives we have in place to address customer error, along with those we will be introducing in the future as part of the fraud and error strategy (announced in 2010), identify and correct both over and underpayments of benefit. For example, between April and December last year, one initiative to reduce error in Pension Credit found weekly underpayments totalling £23,000.

7.  Where underpayments are found they are rectified and arrears covering the whole period of the underpayment are paid to the customer as a matter of course. Since, as we discussed, benefit spending is treated by HM Treasury as Annually Managed Expenditure, such rectification of underpayments is not budget constrained.

8.  On a related point, to clear any residual confusion, the target to reduce fraud and error by 25% by 2015 is to reduce overpayments from fraud and error. So there are no perverse incentives on the levels of underpayments.

9.  Lastly, as promised, I have copied the costs and savings profile for the new fraud and error strategy to the National Audit Office.

February 2011

Profiled DEL Spend (£m)
Profiled AME Savings (£m)
Funding Source NameBrief Description Delivery Business 2010-112011-12 2012-132013-14 2014-15Total 2010-112011-12 2012-132013-14 2014-15Total AME Savings MVFE Reduction Customer Error
MVFE Reduction
Spend to Save Phase 1—agreed funding Business Rules Engine Apply business rules at the point of claim to identify and prevent fraud and error from entering PC, IS and JSA PDCS5 102 22 213 1221 2929 9426 7
ATLAS Notify local authorities automatically when a Tax Credit (or a range of other benefits) is awarded or when there is a change to an existing award. WWG13 31 11 200 85100 10075 360130 81
Pension Credit Case Cleanse Reviewing complex pension credit cases to identify and correct error. PDCS5 00 00 524 00 00 2422 3
Right Payment Programme Checking DLA cases outside of the usual checking cycle, focusing on those with the greatest propensity to change. 1 11 11 51 48 1212 3711 5
Additional Pension GMP Correction Correcting known errors made in the calculation of Additional Pensions with a Guaranteed Minimum Pension (GMP). 4 40 00 96 1515 150 5114 2
JCP Call Cleanse—change of circumstances management Making outbound telephone calls to a target group of customers to identify changes of circumstances based on a risk model JCP4 2416 164 6313 76112 10418 323102 97
JCP ESA Cleanse Case cleansing to prevent IB error being carried into ESA on migration (staff based) 0 00 00 11 59 128 3511 4
JCP SDP Establish a link between the Disability Living Allowance Computer System and the Income Support Computer System that will allow information regarding DLA awards to be routed to "process management" software. 0 01 10 31 34 50 135  
Debt Management: Reduction in Customers Awaiting Action Scaling up of business as usual activity to reduce outstanding debt cases. GFD1 10 00 23 196 00 280 0
Debt Management: Mining the Debt Stock Investigating those customers that are neither in recovery or awaiting action. 3 51 00 96 3721 00 640 0
Debt Management: Tracing "Gone Away" Customers Investing in systems and staff to integrate facilities with HMRC to trace customers who DWP has lost contact with. 0 11 00 20 24 20 80 0
SUB-TOTAL  36 5024 228 13958 258300 279142 1037321 199
Universal Credit Business Case— Universal Credit  TBC                     
OBR/HMT yet to sign off SFISSingle Fraud Investigation TBC0 720 66 440 00 519 2417  
SUB-TOTAL  0 720 66 440 00 519 2417 0
IRIS Risk and IntelligenceTBC 031 7638 38221 027 87122 118354 11138
Accreditation Staff Accreditation TBC0 22 22 90 27 99 278  
EASD IT PromptPDCS 01 00 02 00 23 38 31
PC Prompt IT PromptPDCS 00 00 00 00 12 25 21
No. 10 FraudHotline Fraud HotlineTBC                   0 
and ErrorTaskforce Regional Targeting TBC0 99 99 460 1630 3031 10728 10
strategy—LA Data  TBC                   0 
OBR/HMTID Fraud Unit  TBC                   0 
yet sign offPDCS Cleanse Manual Case Cleanse PDCS  610 1310 4924 56101 14757 384134 19
Debt More Effective Recovery TBC                  0  
Sanctions Increased Sanctions TBC0 40 00 60 018 4570 1320 0
Obligations Clearer Client Obligation TBC                  0  
Comms Targeted Communications TBC                  0  
Measurement Refine Measurement TBC                  0  
PMO Programme ManagementTBC                   0 
SUB-TOTAL  0 5598 6259 33324 102244 358290 1017287 69
TOTAL  36 111141 8973 51682 360544 642451 2079625  


previous page contents

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2011
Prepared 10 March 2011