Retrospective verification of 900,000 ‘at risk’ universal credit claims made during Covid-19 pandemic finds 11 per cent ‘had something wrong’

DWP officials also advise Public Accounts Committee that verification exercise is almost complete and has highlighted £400m incorrect payments

The DWP exercise to retrospectively verify 900,000 universal credit claims made during the Covid-19 pandemic and deemed to be 'at risk', has found 11 per cent 'had something wrong'.

In a Public Accounts Committee (PAC) evidence session on fraud and error in the benefits system yesterday, MPs questioned the DWP's Permanent Secretary Peter Schofield, Senior Responsible Owner for universal credit Neil Couling, and the DWP's Director of Counter Fraud, Compliance and Debt Bozena Hillyer about the impact of the Covid-19 pandemic on the rate of fraud and error and the Department’s actions in response.

Responding to questions specific to the increase in fraud and error in universal credit during the pandemic - as highlighted in the National Audit Office report on the DWP’s accounts for 2020/2021 - and the Department’s business case to get the increase down from 14.5 per cent to 6.5 per cent by 2027/2028, Mr Schofield provided an update on the Department’s work to re-examine claims made during the pandemic, advising that it involves -

'… going through all of the claims that got through with easements through the period of the main part of the pandemic. It has been going through about 900,000 claims as part of that process. There is a bit in the the annual report and account 2020/2021 [at page 237] about the progress we have made on that.'

With this work now almost finished, and claims where something was found to be wrong 'put right', Work and Pensions Committee Chair Stephen Timms (who was invited to join the PAC for the session) asked for further details of whether the errors found were as a result of fraud. Mr Couling responded by saying that -

'… what we did was to take three of the controls we took off … I mentioned child benefit matching [earlier]. That was one of the checks we went back and applied, and when we applied those three checks we found 11 per cent had something wrong with the case. They were not accurate; that is probably the simplest way of putting it.'

NB - MPs were also told that there are currently no plans to review the additional 433,000 ‘riskier’ universal credit claims that started in the early pandemic period but ended before January 2021, as the current priority for resources is to target claims that are ongoing.

Mr Schofield added that -

'... money that has been raised by the 1,500 folk that we have had working through the retro action ... comes to around £400 million in total from the retro action. That is 1,500 people working over a six-month period.'

Elsewhere, Mr Schofield provided an update on other actions the Department has taken, or is planning to take, to manage fraud and error, advising that more than 3,000 additional staff are being recruited to undertake compliance and fraud work this year. In addition, Mr Schofield gave further details of the DWP's specialist 'stolen ID' team - set up to investigate around 40,000 fraudulent claims that were mostly linked to fraudulent advanced payments claims - advising that -

'... if there is any hint of someone getting in touch with us with any hint that they have been subject to a stolen ID, their case is automatically routed through to this team of experts who sit in Bozena’s area. They have a service level agreement to resolve cases within 48 hours.'

Ms Hillyer added that despite an estimated 4,000 people being wrongly asked to make repayments after being victims of stolen identities, processes are now in place to help prevent it happening again -

'We have the specialist team in place, and we have the processes in place in debt as well. Just to reassure you, if somebody has had their ID stolen, they do not have to repay that money, and we will sort it out ...'

NB - the DWP's Annual Report and Accounts 2020/2021 highlights that around 300 of these 4,000 cases were subject to automatic repayments where the person had to be fully recompensed by the Department. In addition, it shows that 5,363 people had their legacy benefits incorrectly stopped as a result of universal credit claims made using their stolen identities, and then averaged two and a half weeks without payments before the Department was able to reinstate their benefits.

The transcript of the Public Accounts Committee session on fraud and error in the benefits system is available from parliament.uk