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Benefit fraud costs tax payers £2.6bn
Last updated at 10:22am on 25.07.07
Tory MP Edward Leigh, chairman of the all-party Commons public accounts commitee
Taxpayers were hit with a £2.5 billion bill for fraud and error in the benefits system last year, official figures have revealed.
Spending watchdogs refused to give the Department for Work and Pensions' accounts a clean bill of health for the 18th year running because of the failure to significantly reduce the losses.
Tory MP Edward Leigh, chairman of the all-party Commons public accounts committee, said: "Each year a grievous amount of money which could be put to so much better use is being lost to fraud and error.
"The DWP is trying hard to stem the f lood of money going down the drain and has made a little progress.
"But it remains of huge concern to our committee that year after year billions of pounds are going into the pockets of people who are not entitled to them."
Sir John Bourn, head of the National Audit Office, today qualified his opinion of the DWP accounts for 2006/07 which showed £690 million lost to fraud, £1,010 million to customer error and £850 million to official error.
In total this came to 2.1 per cent of the overall benefit bill, down from 2.3 per cent, or £2.7 billion, the previous year.
He said some progress had been made in introducing systems to cut fraud and error and properly record and value identified debts.
But there was still "significant sums lost to fraud and error".
However, he added: "At the same time I have been able to remove two aspects of the qualification of the Department's accounts which is a clear tribute to the leadership evident within the Department in tackling these issues."
Reader views (7)
At least the DWP are able to tell how much money has been wasted due to incompetence...something the HMRC are unable to do or are unwilling to do in the billion of pounds wasted tax credit farce.
- Robert, Bristol, 26/07/2007 00:05
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How much does tax evasion and avoidance cost each year?
- Mike Melbourne, Bedford, 25/07/2007 19:49
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The benefits system in this country is not only open to abuse; it invites people to help themselves.
People who have not contributed a penny to the kitty should not get any benefits unless they are severely disabled. It is an insult to the thousands of old people who have paid their taxes during the whole working life and now have to live like paupers, while others simply refuse to work and milk the system.
- Beatriz, London, 25/07/2007 18:38
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That's £2.5 billion of fraud and errors which they know about, how much is the fraud which they don't know about costing us?
- Trevor Roll, London, 25/07/2007 12:37
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To be honest I am surprised that the figure is not greater. An effective hit squad to root out these fraudsters could by its efforts save enough money to rescue the NHS, save most of the country from flooding and improve conditions for our well valued but badly treated servicemen and women.
It is time that the government started looking after that group of honest, tax paying, home owning and financially prudent people who seem to be at the back of every list of priorities.
- Martin Fielding, London. England, 25/07/2007 12:07
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At lest the DWP are able to give figures broken down.. unlike the HMRC tax credits, where they seem unable to do this or are very un-willing. They always say it is due to fraud, so are always blaming someone else for their errors, but £850 millon to official error. That is some big error, has anyone been sacked for this? I guess not.
- Robert, Bristol, 25/07/2007 12:01
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Why can't the system get it right? I know lots of people who claim income support and then work part-time -cleaning, ironing etc. Why aren't they checked on properly? Especially if they've been out of work for more than 5 years or if their kids are of school age surely they could do p/t work for 2-3 hrs daily. Ialso know a family for 20 years who have never worked...says it all.
- Sarah, London, 25/07/2007 11:51
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