The Department for Work and Pensions is not doing enough to stem losses totalling £1.1 billion a year caused by benefit recipients making errors in their claims, according to a spending watchdog’s report.
Three years into a five-year clampdown on error launched by the DWP in 2007, there was “no discernible decrease” in the amount of cash lost to customer errors, said the National Audit Office.
There was also little improvement to be seen in the £800 million annual underpayments due to mistakes in applications for benefits, which was causing hardship to the families concerned
Although Iain Duncan Smith’s department has established a Fraud and Error Council and introduced other measures to reduce the volume of customer mistakes, it does not have enough information to target these initiatives effectively, said the NAO.
Auditor General Amyas Morse said: “The benefits system is complicated and it is inevitable that mistakes occur. The DWP, therefore, faces a significant challenge in tackling error by claimants.
“The department has demonstrated a firm commitment to tackling administrative error, while its resolve to tackle customer error has so far been less evident.
“It now needs to bring its focus on customer error to the same level. The key to success in each area is a coherent strategy supported by good information on what works to deliver the best results.”
The report acknowledged that mistakes by claimants are “difficult to detect, correct and prevent”. In many cases, they arise from changes to claimants’ circumstances which they may not realise they need to tell the department about.
Customer error consistently highest in claims for Housing Benefit, which saw £420 million in overpayments and £220 million in underpayments in 2009/10. The report said that the scale of overpayments and underpayments demonstrate a “clear imperative for improvement”.
And it cautioned: “The NAO found little evidence that there has yet been sufficient attention paid to reducing losses due to customer mistakes. The department launched a five-year strategy for tackling error in January 2007, but there has been no discernible decrease between 2006/07 and 2009/10 in underpayments and overpayments due to customer error as a percentage of benefits expenditure.”