Police funding reforms were halted after Home Office mixed up two files

Exclusive: Error affected grants worth millions and meant forces could have received wildly different amounts than told

Home Affairs Committee chairman Keith Vaz received an apology from the Home Office (Getty)

The Government dramatically halted its controversial police funding reforms after Home Office analysts made the “basic mistake” of mixing up two data files with similar names, the department’s most senior civil servant has admitted.

The astonishingly simple error affected Government grants worth millions of pounds and meant police forces could have received wildly different amounts of money than they had been told they could expect under the reforms.

Mike Penning, the policing minister, apologised to Parliament for what he described as an “embarrassing” mistake in the Home Office’s calculations and announced that the reforms were being put on hold.

MPs on the Commons Home Affairs Committee last week labelled the reforms a “shambles” and said the error had “gravely damaged” police forces’ confidence in the process.

The Independent can now reveal that an internal review at the Home Office has found that “confusion over file names” resulted in analysts using the wrong dataset.

A letter sent to the Home Affairs Committee chairman Keith Vaz by Mark Sedwill, Permanent Secretary at the Home Office, apologising for the error, says “confusion” over the “near identical” filenames was to blame.

The Home Office omni-shambles on police funding would be laughable if it was not so serious

&#13; <p>Jack Dromey, Labour’s shadow policing minister</p>&#13;

The letter, seen by The Independent, says: “The base error was the confusion by analysts between the two filenames and datasets.

“But that error was compounded not corrected because they had insufficient understanding of the policy issues and context, and because policy officials had insufficient understanding of the technical issues and data. Errors of analysis and judgement were made by individuals at all levels. This will be addressed in their performance appraisals and through the department’s formal performance development and improvement procedures.”

The error centred on the Home Office’s use of a private data tool known as Acorn, which is owned by a London-based company called Caci and measures levels of urban deprivation. It is normally used by retailers to understand their customers.

It has emerged Home Office analysts based their calculations on an older classification of that data, which is based on 2001 census data, when they were meant to be using an updated version, which is based on 2011 census data.

It created a huge discrepancy in the money that would have been received by police forces under the reforms. The Metropolitan Police, for example, was set to lose £184m under the Home Office’s calculations, but would only lose around £3m if the correct dataset has been used, according to an analysis carried out by Mr Hogg’s office.

Mr Sedwill is considering whether to make changes in the Home Office’s crime and policing group as part of a modernisation programme. Several police and crime commissioners have called for Home Office ministers and officials to be held accountable for the error.

Labour’s shadow policing minister Jack Dromey said police forces had been let down by the Home Office’s “incompetence”. He has called for the process to be overseen by an independent panel.

He said: “The Home Office omni-shambles on police funding would be laughable if it was not so serious.”

The Home Office is yet to comment.