More effort needed to beat benefit fraud

The Government has "a mountain to climb" in tackling benefit fraud, a senior civil servant admitted yesterday.

Sir Richard Mottram, permanent secretary at the Department for Work and Pensions, said ministers had to "grind up performance" to cut the multibillion-pound abuse of the welfare system. He said that calls to the Government's fraud telephone hotline and tip-offs from neighbours and family members accounted for only 3 per cent of prosecutions against those dishonestly claiming benefits. "But 3 per cent is better than no per cent," said Sir Richard.

He told the Commons Public Accounts Committee that the hotline acted as a "deterrent" to dissuade people claiming unemployment benefits from working illegally.

Under questioning Sir Richard said the Government did not know whether housing benefit fraud was rising or falling. "We think down, but we don't know," he said. He hoped new computer systems would be able to identify far more fraudulent claimants. "We are assuming that IT will deliver one-third of gains between now and 2006," he said. "Two-thirds will have to come out of grinding up performance."

Sir Richard said he was disappointed that more had been done to cut housing benefit fraud, saying: "I would agree with the committee that the pace of change has been less than we would like." He also admitted that the Government may have "overestimated" the number of disabled people who have been defrauding the Government.

Sir Richard told the committee of MPs that the Department of Work and Pensions wanted to look again at the number of people it believes are wrongly claiming disability living allowance.

"In relation to disability living allowance we believe it is very difficult to know," he said. "We think it could be overestimated, which is why we are very interested in looking again at it."

The benefit tops up the income of disabled people to help them cope with the extra costs of their disability.