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Baroness Ashton of Upholland: It is a smallish number of companies, but trade unions are not included in that. They are not companies. I am describing commercial companies, of which we think that there are about 500 involved. The noble Lord is right to seek clarification, which we propose to do,
 
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about precisely who will be determined within regulation. Members of the Committee will have the opportunity to look at that. The critical issue on the breadth of the definition is that by capturing people and organisations in this way, should a point come when we need to regulate in another part of this sector the particular concerns that we have, we have the power to do it quickly, which Members of the Committee have urged me on and we have addressed in this way. Of course the noble Lord is right that it will be increasingly important to be clear about precisely who comes under the definition. It will be through affirmative regulations that we will do that.

Lord Hunt of Wirral: I am greatly assisted by the noble Baroness in that further clarification. But this is a subject to which we will have to return later in Committee. In the mean time, I will reflect carefully on the points made by the noble Baroness and, in the circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Ashton of Upholland: This may be a convenient moment for the Committee to adjourn until next Monday at 3.30 pm.


 
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Written Statements

Monday 16 January 2006


 
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Benefit Fraud Inspectorate Report: Bridgend County Borough Council

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Hunt of Kings Heath): My honourable friend the Parliamentary Under-Secretary of State for Work and Pensions (James Plaskitt) has made the following Written Ministerial Statement.

On behalf of my right honourable friend the Secretary of State for Work and Pensions, the BFI inspection report on Bridgend County Borough Council was published today and copies have been placed in the Library.

In 2004–05, Bridgend County Borough Council administered some £33.3 million in housing benefits, about 14.8 per cent of its gross revenue expenditure. The inspection focused on the council's arrangements for processing claims, as it was taking an average of 58 days to process new claims for housing benefit in 2004–05. The council introduced a new benefits IT system in April 2004. The subsequent transfer of data and issues with installation resulted in the IT system being inaccessible for six weeks. This led to backlogs of work. Senior management and members were supportive of the need to address this and employed temporary staff to clear the work.

BFI found that the outstanding work on new claims had been cleared by April 2005 and that processing performance in this area had since improved to 30 days. The inspection identified no other backlogs of work. Inspectors found that the council had largely overcome difficulties with the implementation of the new benefits IT system and had many good practices in place. The main aspect of performance that required attention related to processing changes of circumstances, which remained below the department's standard. My right honourable friend the Secretary of State is now considering the report and may ask the council for its proposals in response to the BFI's findings.

Benefit Fraud Inspectorate Report: Bromsgrove District Council

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Hunt of Kings Heath): My honourable friend the Parliamentary Under-Secretary of State for Work and Pensions (James Plaskitt) has made the following Written Ministerial Statement.

On behalf of my right honourable friend the Secretary of State for Work and Pensions, the BFI inspection report on Bromsgrove District Council was published today and copies have been placed in the Library.
 
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In 2004–05, Bromsgrove District Council administered some £10.5 million in housing benefits, about 33 per cent of its gross revenue expenditure. There had been sustained improvement in the reported time taken to process new claims, from an average of 50 days in 2003–04 to 44 days in 2004–05 and 42 days for the first quarter of 2005–06. However, this performance was still below the department's standard of 36 days.

BFI found that a lack of prioritisation and inefficient practices were creating unnecessary delays at each stage of the claims process. This was compounded by a failure to ensure that the evidence provided by its customers met the minimum requirements of the department's verification framework. Members and senior officers were not aware of very poor performance in preventing and recovering benefit overpayments and overpayment debt had increased by almost 400 per cent between 2002–03 and 2004–05. Very little action was being taken to minimise avoidable overpayments.

Performance in the application of sanctions against benefit fraudsters was found to have improved. The council applied 11 sanctions in 2002–03, increasing to 37 in 2004–05. However, it had failed to prosecute offenders in nine instances where fraud had been proven. This was due to delays within its legal services department. The inspection revealed that management information provided to members, senior officers and the department was often inaccurate with performance being overstated in some instances. Inspectors found minimal management checks being carried out, inadequate audit coverage and a failure to act on audit recommendations. My right honourable friend the Secretary of State is considering the report and may ask the council for proposals in response to BFI's findings.

Benefit Fraud Inspectorate Report: Falkirk Council

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Hunt of Kings Heath): My honourable friend the Parliamentary Under-Secretary of State for Work and Pensions (James Plaskitt) has made the following Written Ministerial Statement.

On behalf of my right honourable friend the Secretary of State for Work and Pensions, the BFI inspection report on Falkirk Council was published today and copies have been placed in the Library.

In 2004–05 Falkirk Council administered some £37.7 million in housing benefits, about 10 per cent of its gross revenue expenditure. The inspection focused on the council's counter-fraud arrangements, as it reported to the department that it had not applied any sanctions between April 2003 and March 2005.

BFI found that the council had strengths in its processes to limit the opportunities for fraud and error to enter the benefit system. In particular, claims were consistently verified to the standard of the
 
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department's verification framework and effective arrangements were in place to carry out claim reviews and data matches. However, while the council had a prosecution policy, the inspection found that it did not apply it in practice. Its failure to administer any form of counter-fraud sanction had undermined the council's ability to create an anti-fraud culture and send a clear message to benefit fraudsters.

The inspection also revealed that the council lacked key management controls over its counter-fraud activities. Its investigation work and file management were ineffective and there was a need to improve the monitoring of performance and analysis of casework within the fraud team. Falkirk Council has acknowledged its shortcomings in this area and there is a commitment to improve performance, which includes developing an action plan to address the recommendations made in BFI's report. My right honourable friend the Secretary of State is now considering the report and may ask the council for its proposals in response to the BFI's findings.

Benefit Fraud Inspectorate Report: South Northamptonshire Council

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Hunt of Kings Heath): My honourable friend the Parliamentary Under-Secretary of State for Work and Pensions (James Plaskitt) has made the following Written Ministerial Statement.

On behalf of my right honourable friend the Secretary of State for Work and Pensions, the BFI inspection report on South Northamptonshire Council was published today and copies have been placed in the Library.

In 2004–05, South Northamptonshire Council administered some £8.7 million in housing benefits, about 20 per cent of its gross revenue expenditure. The inspection focused on the council's arrangements for processing claims, as it was taking an average of 104 days to process new claims for housing benefit in 2003–04.

BFI found that the council's performance in processing new claims had significantly improved. The average time taken had reduced from 104 days in 2003–04 to 81.5 days in 2004–05, and 43.5 days in the first quarter of 2005–06. While this remained longer than the department's standard of 36 days, there had clearly been a considerable improvement in the council's performance. The inspection revealed a similar situation in the time taken to process changes of circumstances, which had improved from an average of 44 days in 2003–04, to 19.7 days in 2004–05, and 18.7 days in the first quarter of 2005–06. Again, this performance was below the department's standard of nine days, but represented a significant improvement.

The council's lack of workload prioritisation and forward planning was causing unnecessary delays. In particular, it had not set any internal targets for
 
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benefits staff. This was compounded by a lack of procedural guidance throughout the benefits service, leading to inconsistent working practices. Inspectors found that this was one of a number of internal audit recommendations that the council had failed to act upon. My right honourable friend the Secretary of State is now considering the report and may ask the council for its proposals in response to the BFI's findings.


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