Councils failing to tackle benefit fraud – watchdog

8:20am Tuesday 20th May 2008

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RECORD levels of benefit fraud have been detected by a Government watchdog but local authorities are failing to tackle the problem, according to a report published today.

The National Fraud Initiative (NFI), which is carried out every two years by the Audit Commission, has uncovered £140m in dodgy benefit claims in 2006-7.

This includes £24m in housing benefits, £4m in income support and more than 16,000 disabled parking badges being used by people who did not need them.

However, the Audit Commission has urged councils to take action when they are alerted to fraud.

Chairman Michael O'Higgins said: "These are not victimless crimes and some of the fraud found is both blatant and shocking.

"People are stealing homes, pensions, student loans, parking places and benefits, seemingly confident that no one is tracking them. They are wrong.

"We urge all public bodies to put in place the necessary trained staff to work with us and follow up any matches. It makes both moral and financial sense to detect fraud and over-payment."

The National Fraud Initiative collects data from local authorities to highlight discrepancies in benefit claims and employee records.

It then refers the "anomalies"

back to the council for further investigation.

Case studies from 2006-7 include a man receiving council tax benefit, income support, incapacity benefit and disability allowance despite running a market stall and several other businesses from his home.

He drove a Mercedes and had savings of more than £100,000, while his wife claimed carer's allowance for looking after him.

The report says: "If there is no effective penalty for fraud there is no deterrent.

"We now expect public bodies to do more to follow up the potential fraud that we have identified.

"They should adopt a zero tolerance policy to fraud. They should also ensure that adequate resources are devoted to following up suspected frauds and overpayments."