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Benefit errors still at massive level of £2.6bn

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02/02/2007

The Department for Work & Pensions (DWP) has admitted that fraud and error led to benefits worth about £2.6bn being overpaid in 2005-06.

The figures closely follow those published by the National Audit Office in November 2006, which also monitors UK investment in benefits.

At the same time, the DWP conceded that £900m was underpaid to claimants who were paid less than their entitlement. The amount of underpaid benefits would have been higher if it had included claimants who did not apply for their rightful entitlement or whose claims were wrongly rejected.

In terms of the UK investment in the Welfare State, the total loss of £2.6bn comprised 2.2% of all benefits paid out. The major overpayments were: £550m of Income Support and Jobseekers Allowance; £770m of housing benefit; £327m of pension credit.

Although admitting that the figures were high, the DWP said that fraud and error affecting Income Support and Jobseekers Allowance had fallen by 50% since 1997-98.

But Housing Benefit overpayments have risen by 13% since 2002-03, in contrast to projections of a 25% cut.

The DWP missed a further target of achieving a 20% reduction in overpayment of Pension Credit since 2001-02, although it is estimated that 11% was cut from the total.

 

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