NAO: £154m spent to uncover £106m in fraud

Audit Office
(NAO) has found the
Department for Work and Pension (DWP) spent
£154m in 2006-07 to identify an estimated £106m of fraudulent claims after
examining six of the most important counter-fraud activities for their cost

NAO found the department had cut estimated benefit fraud from £2bn to £800m a
year since 2000, but said DWP ‘could do more’ to be cost-effective.

By comparing known costs and benefits, NAO found cases of suspected fraud
identified through the department’s data matching service were more cost
effective than those generated by the hotline, identifying on average £24 per £1
spent compared with £16 fraudulent claims identified per £1 spent on the

‘Although some of the department’s initiatives lead to earlier interception
of overpayments and may deter potential fraudsters, I believe the department
could do more to determine whether its activities are cost effective,’ Sir John
Bourn, head of the NAO, said.

Further reading:

NAO PFI report unveils ?180m of waste

Transport agencies could save £33m

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Fiona Westwood of Smith and Williamson.