Revealed: 32 years of benefit payment failure by the Department of Work and Pensions

DWP celebrating 32 years of inaccurate accounting

Yesterday while all eyes were on Boris Johnson’s ” Build,Build, Build ” speech the Department for Work and Pensions slipped out their annual accounts for the last financial year.

In what looks like a classic “cover up ” job to bury bad news, the ministry probably did not want the world to know that their accounts had been censured for material inaccuracy for the 32nd year in a row.

The reason is the failure of the ministry to be able to account for unacceptable levels of fraud and error in the huge number of benefit payments. Billions of pounds have been overpaid to claimants through fraud and mistakes by claimants and errors by officials. And billions of pounds have been underpaid by officials to claimants because they have made mistakes in calculating people’s benefits.

The latest figures are a record for every year since John Moore, was social security secretary under Lady Thatcher in 1988.

It shows that ” Excluding State Pension, the estimated rate of overpayments has increased again to 4.8% (£4.5 billion) of estimated benefit expenditure, from a restated rate of 4.4% (£3.8 billion).

“The estimated rate of underpayments, excluding State Pension, has decreased to 2.0% (£1.9 billion), from its estimated rate of 2.2% (£1.9 billion) in 2018-19. The rate of overpayments in 2019-20 is the
highest estimate to date.”

The worst benefit is the new hated Universal Credit which has suffered from both overpayments and underpayments and claimants have to wait five weeks before they can get it. Since the payment depends on claimants’ monthly varying income the scope for inaccurate reporting of the money is large.

The report says: “For Universal Credit, the estimated rate of overpayments increased from 8.7% to 9.4%. This is the highest recorded overpayment rate for any benefit other than Tax Credits (administered by HMRC), which peaked at 9.7% in 2003-04.”

“Underpayments rates have fallen for Universal Credit, Employment and Support Allowance and Pension Credit, and the estimated rate for Housing Benefit has increased. Personal Independence Payment has the highest rate of underpayments at 3.8% of expenditure in 2019-20. This rate has not changed from 2018-19.”

But the small print of the report also reveals how the Department calculates this. It takes samples of benefit payments to arrive at these figures but the National Audit Office reveals that 61 per cent of the benefits paid out to claimants are based on recalculated estimates for the previous year.

Some other omissions are staggering. The Department has never checked whether payments are accurate for claimants on Disability Living Allowance for 16 years – last done in 2004-05.

More extraordinary the Department has never checked whether money paid out to 12 million pensioners is accurate or not since 2005 – that is 15 years ago.

Instead the department maintains there is no serious fraud or underpayments in pensions – calculating it as just £300 million out of an annual payment of £98.6 billion.

Given this year we had a case this year of a 94 year old pensioner being owed a staggering £117,000 because of 34 years of underpayments, I find this complacency mind blowing.

I also think the National Audit Office, as their auditors, is remiss in not asking for an update.

Next year’s estimate of benefit fraud and error is likely to even more out of kilter thanks to Covid 19 as the ministry have got rid of staff monitoring fraud to be able to pay out the 2.6 million claims for universal credit.

And although the department is said to be investigating 143,000 suspicious claims under Covid 19, it can’t follow them up because it can’t visit them at home.

Gareth Davies, the head of the NAO, said :

“I am concerned that fraud and error in benefit payments have risen again. Fraud and error have a real cost, both for those who face deductions from their income due to overpayments and because it reduces the public funds available for other purposes.

“As the Department takes on a set of unprecedented challenges arising from COVID-19 it is more important than ever that my qualification is not seen as business as usual and the Department responds in a cost-effective way to minimise risks of fraud and error.”

Next year I am certain will be the 33rd year the ministry accounts are questioned and found wanting.

20 thoughts on “Revealed: 32 years of benefit payment failure by the Department of Work and Pensions

  1. Spot on yet again David!

    I for one have NEVER been paid correct PIP, after 5 Tribunals, LEAP Cort case and a 2nd PIP claim because my first had taken 2 years and still unresolved. Unfortunately, a 2nd PIP claim auto-closes any outstanding first claim. Win-win DWP. And in their accounts they ask to be a claimants “ally” and that they espouse their “Public Sector Equality Duty of Fair Treatment”…..what?
    With a kick in the teeth!

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  2. As someone who has a family members & friends who work tirelessly for the benefit of the public, I am appalled at your article.
    So many millions benefit from the DWP, obviously mistakes are made, including from many fraudulent claims, but a lot of these imbalances are later corrected.

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    • On reading the article I’m sure that the people who work for the DWP are not being criticised. They, like all government departments, will be working with fewer staff and resources than are needed to do the job they are required to do. To me the article is levelling criticism at the Ministers over the last 32 years who have not done their job which is to manage the department properly and if this is the 32 year that they have not done this then they have been grossly overpaid for their incompetence.

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  3. I love reading your blogs.it seems its the only place to get the truth about things the government dosnt want us to know!!! Cant wait for the 60’s appeal. I so hooe they win !!
    If they dont it will be a big injustice.

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  4. They misappropriated and re-allocated £271 billion from the NI pot with no accountability. Although I have seen abuses of the benefits system in the past, I have just signed a petition to end sanctions because those administering the system are too incompetent and the vast majority of actions would be, incorrectly, to the detriment of some very vulnerable people in extraordinary times. I was once summoned to an enquiry at DWP offices over information they had been supplied more than once at the very beginning of my claim and then tried to be clever until I pointed out their deficiencies which actually only required someone to to read the information already in their possession. Further, I called shame down upon them as they had dragged me away from my terminally-ill mother’s sick bed simply to display their gross incompetence, having already threatened me with sanctions for non-attendance. They are the epitome of the UK’s new motto: ‘well, close enough is good enough!’. Unfortunately, I worked in a totally incompatible ‘right first time’ and ‘striving for excellence’ environment and still, stupidly, expect more from people devastating the lives of the down-trodden and vulnerable. Sorry Ly, I hear far too many stories of devastation wrought by their ‘mistakes’ including children deprived of food – there is no excuse for that!

    Liked by 1 person

  5. hi can u look into DWP stopping loan repayments through virus..as we were told we would get a break from April till further notice (this week) because my surname begins with S..my letter never came until 6/6/20..and I have only received one payment..as opposed to persons at beginning of the alphabet.. i called DWP to ask and was told only from that day’s
    letter, which is highly unfair as we have all had to struggle during virus.. and they have no intention to backdate it.. thanks

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  6. Afternoon David This is the first time I have commented on this site but thought I would bring your attention to a article published by lancet public health on July 1 st ,a study by Newcastle University on working past 50. interesting reading that could help our cause for justice in the pension age hike regards Marion Scott.

    Like

  7. Good grief.. What a shocking statistic.. So much money stolen and not chased .. It’s appalling that the performance level of the DWP is so poor it’s criminal. So many people in real need and not given and so many takers.. Mostly never contributing in the first place I’m sure . A total disgrace.

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    • Diane, I have had two different cancers in 2 years-since 2014 I have been underpaid the Mobility component of PIP. I spent from Spring ‘15-Christmas ‘18 just to receive PIP & STILL incorrect. The DWP, which should abide by laws of no discrim was forced from 2017 by a court case to treat mental and physical disabilities equally. Not only don’t they have Mental health assessors in teir grossly overpaid subbies like Atos & Capita but only routinely assess physical frailties. The Leap outcome was 1.6million cases for reassessment by DWP from 2017. Then early thus year DWP said THEY were deciding who should receive it and only 64000 would be looked at. Overpayments are disturbing but sick & vulnerable have to out up with an appalling service level-phones unanswered, letters no timescales…..it is dreadful to be ill and not be properly served by the DWP. Underpayments are rife.

      The DWP on last check had >5000 staff employed on fraud duty. HMRC Special High Earners fraud unit has 500 employees-WHO gets away with the biggest frauds????

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  8. I worked in Benefit Agency up until 2001. This was a problem that was being addressed by BA back then. I was seconded to work going round districts randomly to check accuracy rates. The biggest problem areas were where benefits were processed at centres away from where the claimants lived. For example a large majority of London claims were processed in Belfast. Another difficulty was processing claims from Asian claimants where name spelling, family names and dates of birth inaccuracies caused a huge difficulty leading to duplication of claims being easy to achieve causing huge losses to public funds.
    The fact that computer systems could not do what was required of them and work around caused more issues than solutions. Training was a sparse commodity and turnover of staff in large English cities was very high.

    Things do not appear to have changed much I recently started receiving my state pension. First letter stated I was entitled to £175.20per week but then said I would paid (blank) from (blank date) to (blank date) how are people meant to cope with this type of correspondence. I spent over 45 minutes holding on the phone I was eventually advised not to worry it would be fine. Turns out they employed hundreds of people have them basic training enough to be able to input claim details but not to be able to do anything else. This was because all experienced staff were taken away to deal with Covid19 Universal Credit claims.. God save us

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  9. Pingback: Was Universal Credit INTENDED to cause massive errors in payments? DWP accounts suggest so! | Vox Political

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