The National Problem
The Audit Commission Inspection report 2001 said:
"Housing is a basic human need. Housing benefit (HB) helps 3.4 million households in England, and 0.2 million in Wales, to meet that need, at a cost in 1999/00 of £9.6 billion in England and £500 million in Wales."HB suffers significant levels of fraud and error, due to the high volume of payments, the difficulty of keeping track of every person's circumstances and the opportunity for dishonest representation."Because the regulations are complex, it is easy for claimants to make mistakes or misunderstand the requirements."In 1997, the Commission, with the National Audit Office (NAO), reported that estimates of HB fraud and error varied from £900 million to over £2 billion a year. Local Authorities have a responsibility to detect fraud and put in place measures to prevent abuse. In November 1997 the Government set up the Benefit Fraud Inspectorate (BFI) to measure the robustness of individual authorities' administration, and in particular their processes to guard against fraud."
The Government estimate that over £2 billion pounds is lost to benefit fraudsters per year. To put this into context, this equates to an additional hospital in every county as well as 80 additional police officers on the street.
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