Housing Benefit Fraud & Error: DWP working with local - - PowerPoint PPT Presentation

Housing Benefit Fraud & Error:

DWP working with local authorities to tackle Fraud & Error

Clare Elliott DWP Deputy Director, Housing Delivery and Operations Finance District Council Treasurers Meeting 9 January 2015

2 Department for Work & Pensions

Context

• Introduction
• Fraud and Error
• NAO Recommendations
• RTI Bulk Data Matching Initiative
• Fraud and Error Reduction Incentive Scheme
• Working with local authorities

Housing Benefit overpayments over time Since 2011/12, HB F&E has been getting worse.

5.5% 5.1% 4.6% 4.7% 4.7% 4.6% 4.9% 5.1% 6.0% £0m £200m £400m £600m £800m £1000m £1200m £1400m £1600m 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 Monetary Value of Expenditure Overpaid 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% Percentage Expenditure Overpaid Fraud (£m) Claimant Error (£m) Official Error (£m) Total Fraud and Error (£m) %Fraud %Claimant Error %Official Error %MVFE

Housing Benefit 2013/14: What was incorrect about the claims?

Finding a way to reduce overpayments due to earnings is critical!

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a c t i v i t i e s O t h e r OE CE Fraud

How do the four claimant groups contribute to the overall MVFE level?

2.1% 2.0% 1.9% 2.3% 2.4% 2.4% 2.5% 3.1% 3.6% 2.3% 2.1% 1.8% 1.7% 1.5% 1.2% 1.6% 1.1% 1.4% 0.4% 0.5% 0.5% 0.3% 0.4% 0.5% 0.4% 0.6% 0.5% 0.5% 0.5% 0.5% 0.4% 0.4% 0.5% 0.4% 0.3% 0.5%

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 2005/6 2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13 2013/14 % expenditure overpaid Working Age Standard Working Age Passported Pensioner Standard Pensioner Passported

What is the level of F&E within each Claimant Group?

% MVFE in the Working Age Standard group is always the highest, because that is where the majority of the earnings overpayments occur.

0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18%

Apr05-Mar06 Apr06-Mar07 Apr07-Mar08 Apr08-Mar09 Apr09-Mar10 Apr10-Mar11 Apr11-Mar12 Apr12-Mar13 Apr13-Mar14 Apr05-Mar06 Apr06-Mar07 Apr07-Mar08 Apr08-Mar09 Apr09-Mar10 Apr10-Mar11 Apr11-Mar12 Apr12-Mar13 Apr13-Mar14 Apr05-Mar06 Apr06-Mar07 Apr07-Mar08 Apr08-Mar09 Apr09-Mar10 Apr10-Mar11 Apr11-Mar12 Apr12-Mar13 Apr13-Mar14 Apr05-Mar06 Apr06-Mar07 Apr07-Mar08 Apr08-Mar09 Apr09-Mar10 Apr10-Mar11 Apr11-Mar12 Apr12-Mar13 Apr13-Mar14 Working Age Standard Working Age Passported Pensioner Standard Pensioner Passported

% expenditure overpaid Official Error Fraud Claimant Error

7 Department for Work & Pensions

Performance variation

New Claims Changes of

Circumstance

Total Sanctions Per 1000 Caseload Prosecutions + Ad Pens Per 1000 caseload Debt Recovery HBMS Referrals Outstanding

GB Worst Performance 63 42 0.22 0.11 0% 100% GB Bottom Quartile 28 12 2.45 1.63 62% 63% GB Median 22 9 1.22 2.41 68% 39% GB Top Quartile 18 6 2.39 3.72 75% 24% GB Best Performance 5 1 24.35 22.32 114% 0%

8 Department for Work & Pensions

NAO recommendations

• Set out clearer responsibilities for reducing fraud and

error

• Improve incentives to prevent and identify fraud and

error, and align these with the Department's own aim

• Improve the quality of information about fraud and

error in oversight and assurance processes

• Develop a plan that addresses major areas of risk
• Align work by identifying and profiling risky cases
• Exploit data and strengthen fraud and error controls

9 Department for Work & Pensions

Real Time Information (RTI)

• rolled out across all local authorities from 6 October

2014

• HB systems enhanced to manage referrals and present

the data to local authorities

• reports of high value overpayments and several

authorities reporting average overpayments of around £900

• last tranche of referrals will take place in February 2015
• on-going discussions to explore how this can be

extended into 2015-16

10 Department for Work & Pensions

Fraud and Error Reduction Incentive Scheme (FERIS)

1

• estimated loss due to HB Fraud and Error at £1.45

billion, up 19% on previous year

• in response, Fraud and Error Reduction Incentive

Scheme launched on 24 November

• financial reward to local authorities
• up to £38.5 million for 2014/15 and 2015/16
• DWP Performance Development Team support

11 Department for Work & Pensions

Fraud and Error Reduction Incentive Scheme (FERIS)

2

• Funding for 2014/15 and 2015/16 is £36 million - based on estimates
• f LA take-up and proportion of LAs meeting the thresholds

2014/15

• Incentive payments estimated at a maximum of £6 million if all LAs

meet lower threshold, and £12 million if all LAs meet upper threshold

• £6.2 million start-up fund (if all LAs applied)
• £3 million bid fund (discretionary distribution)

2015/16:

• £9.4 million maintenance fund (if all LAs applied)
• Baselines and thresholds for 2015/16 will be confirmed later in 2015

NB: the above maximum figures add up to more than £36m, we estimate not all LAs will meet the upper threshold, apply for start-up, bid fund or maintenance fund.

12 Department for Work & Pensions

What we are doing

• reducing burden with more data sharing
• ETD/ATLAS merger
• Updating HB FED Strategy: focusing on data sharing,

claimant behaviour, incentives for local authorities and policy & legislation

• review of subsidy and certification
• better planning horizon for admin subsidy

13 Department for Work & Pensions

Engagement and support

• Meetings
• Visits
• Expanded consultancy support
• Working together
• Will challenge you but challenge us back