Greater than 200,000 pensioners had been neglected of pocket by a complete of £1.3bn final yr and lots of won’t ever be repaid due to lax document protecting, in accordance with parliament’s spending watchdog.
Laptop errors on the Division for Work and Pensions (DWP) meant 165,000 additionally missed out on £1.2bn within the earlier yr, the general public accounts committee (PAC) discovered.
Its annual report on the division concluded that the federal government was leaving hundreds of pensioners shortchanged whereas it failed to repair primary errors revamped a few years when civil servants managing the state pension system had been “asleep on the swap”.
In a wide-ranging critique of the pension and advantages system, the report stated the division was presiding over “eye-watering” ranges of fraud and errors that added £8.2bn to the advantages invoice in 2022-23. This represented a fall from £8.6bn within the earlier monetary yr however remained a lot increased than the £4.4bn in 2019-20.
The committee’s chair, Dame Meg Hillier, stated the extent of fraud and error within the system remained unacceptably excessive, and raised the alarm over responses by DWP officers who stated they didn’t anticipate a return to pre-Covid ranges on this space till 2027-28.
“Whereas it’s good to see profit fraud and error fall barely this yr, we’re but to see any important post-pandemic strides made in addressing it,” she stated.
The vast majority of fraud and error continues to be pushed by common credit score, the report stated, which was “overpaid by a staggering 12.8% (£5.5bn) in 2022-23”. DWP officers estimate that 18% of common credit score claims, referring to greater than 800,000 folks, comprise a component of fraud.
The committee acknowledged the division’s plan to deal with such fraud and error, commending the DWP for giving additional particulars of its plans, together with investing an extra £895m in counter-fraud and setting an annual financial savings goal.
Nonetheless, the committee added: “DWP expects a lot of the financial savings to come back from a £443m challenge to cleanse the profit system of incorrect funds by reviewing some 8 million dwell common credit score circumstances over the following 5 years.
“The success of this challenge depends on DWP’s formidable plans to scale up recruitment and productiveness of the workforce reviewing the claims.
The report stated that whereas it was troublesome for HMRC to cross-check nationwide insurance coverage information with state pension information to find out the proper degree of cost, the division should “do extra to detect underpayments earlier than they construct up and have a big impression on pensioners and different claimants”.
A DWP spokesperson stated: “Our precedence is guaranteeing everybody receives the monetary help they’re entitled to, and state pension underpayment charges attributable to official error stay low at 0.5% of expenditure. The place errors do happen, we’re dedicated to fixing them as rapidly as attainable.
“On the identical time, we’re cracking down on fraud with new powers which is able to root out those that attempt to steal from probably the most susceptible whereas saving the taxpayer £600m over the following 5 years. This comes on high of the billions being saved by our counter-fraud plan and will probably be focused at areas the place fraud and error is increased resembling common credit score.”