(Yes, we can all see that it is those who receive welfare benefits that feel the pain, but it is the Secretary of State’s own lack of mental health that we’re witnessing whenever he makes a statement).
Yesterday he was banging the drum against the previous Labour government’s tax credit system. I should remind you, for the sake of clarity, that I don’t disagree with claims that tax credits were not a great way forward. The solution is for employers to pay employees enough money that they don’t need to claim social security benefits or tax credits. The principle is simple: If you’re in a job, you shouldn’t need benefits.
Insanity Dementia Smith has a different point of view. Well he would, wouldn’t he? He’s mad.
Instead, he claimed that the tax credit system, introduced in 2003, was wide open to abuse, with fraud and error costing more than £10 billion. Oh, and just for good measure, he threw in some good old-fashioned Tory xenophobia by claiming that fraudsters around the world targeted the benefit for their own personal gain.
“Tax credit payments rose by some 58 per cent ahead of the 2005 general election, and in the two years prior to the 2010 election, spending increased by about 20 per cent,” he said in a Telegraph article.
“Between 2003 and 2010, Labour spent a staggering £171 billion on tax credits, contributing to a 60 per cent rise in the welfare bill. Far too much of that money was wasted, with fraud and error under Labour costing over £10 billion.
“It will come as no surprise therefore that fraudsters from around the world targeted this benefit for personal gain. ”
Enter Channel 4’s FactCheck, whose representatives asked HM Revenue and Customs to provide the figures that support these claims. They could not.
Instead, we are told, in 2003-04, £16.4bn was paid, and the following year – the one that included the general election to which Mr Duncan Smith refers – £17.7bn. That’s an increase of 8 per cent, not 58.
The total spent on tax credits between 2003 and 2010 – under Labour – was £147bn, not £171bn.
During that time, £11.16bn was lost through fraud and error, with only 1.27bn of that down to fraud – 0.7 per cent of the total.
Regarding error, as a former tax credit recipient, I can report that HMRC was diligent to the point of harassment when it came to identifying errors and recovering the sums involved. This created considerable problems for me – and many others, I’m sure – as I received notification several times, during my claim period, that I had received large amounts in error. I could not understand this. I had filled the forms to the best of my ability. My only conclusion was that the system was complicated and its administrators had been looking for an excuse to take back money.
The result was that I had to become extremely adept, myself, at using the system. I then used it against the administrators to point out errors that they had made, and won back something like £2,000 from them. For a person living on his partner’s DLA and IB, and his own Carer’s Allowance, that’s a huge amount to have had taken away.
I wonder whether Mr Scream-at-the-moon includes money that had to be paid back after correct appeals in his calculation of error. If so, he’s wrong again because that cash was owed to the claimants (as it was to me).
The claim that fraudsters around the world targeted tax credits is completely unsubstantiated as the system does not record the nationalities of claimants.
However: Everyone claiming Working Tax Credits must have a UK National Insurance number. Everyone claiming Child Tax Credits must be able to show they are on Child Benefit, for which they must produce a birth certificate for each child, thereby proving they were born in the UK. So it seems that, while the system may not record the nationalities of claimants, those facts do, in fact, play a part in determining each claim.
Mr Smith remains a disgrace to the government. What a shame David Cameron is such a weak leader that he can’t even summon up the guts to throw him out.
STOP PRESS: What’s this, in a BBC Newsnight press release that’s just appeared on my screen?
“Aspects of Iain Duncan Smith’s CV, relating to his education, are inaccurate and misleading, an investigation by BBC Newsnight reveals.“
Do we have another Jeffrey Archer on our hands?
The investigation into the Conservative Party leader’s education and early career – broadcast at 10.30pm on BBC TWO (Wednesday 18 December 2002) – was presented by Michael Crick, author of the best-selling biography of Jeffrey Archer. It seems we do.
It seems he didn’t go to the Universita di Perugia in Italy, founded by the Pope in 1308, but to the Universita per Stranieri (University for Foreigners) which was founded in 1921 and did not grant degrees when he studied there in 1973. IDS did not get any qualifications there or even finish his exams.
He wasn’t educated at Dunchurch College of Management either. This was the former staff college for GEC Marconi, for whom he worked in the 1980s. IDS completed six separate courses lasting a few days each, adding up to about a month in total. He quite clearly was not there for a sustained period of time and never earned a recognised qualification there.
Who’s the fraud now, Iain?