Tax credit fraud and error – shurely shome mishtake?


The numbers in this BBC article aren’t making any sense, it seems.

The claim is that members of the Commons Public Accounts Committee are saying that efforts to tackle fraud and error in the tax credits system are not as effective as they should be.

But the numbers don’t add up.

The article says fraud and error accounted for £4.5 billion in overpayments in 2013-14 – but the government’s own press release of June 4 this year gave a total of £1.26 billion in fraud and error favouring the claimant for the same period of time.

Of this, more than half the total – £710 million – was due to error, leaving just £550 million in fraud, it seems.

The BBC article gives the impression that tax credits claimants are stealing slightly more than eight times as much as seems, in fact, to be the case.

This seems worthy of a query to the BBC.

Ministers have made progress in reducing benefit fraud and error but their efforts reveal a “paucity of ambition”, a committee of MPs has said.

Despite fraud and error in tax credit payments falling from 8.1% of total spend in 2010-11 to 4.4% in 2013-4, the Public Accounts Committee said £4.6bn was still overpaid to claimants.

Labour MP Meg Hillier said “too much money had gone where it shouldn’t”.

But officials said levels of overpayment were at record lows.

As well as £4.5bn in overpayments in 2013-14, £1.5bn was under-paid.

Source: Benefit fraud clampdown ‘lacks ambition’ say MPs – BBC News

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12 thoughts on “Tax credit fraud and error – shurely shome mishtake?

  1. The Porcelain Doll

    The BBC are working for the Tories, they are hanging by their coattails because they were the ones to help rig the elections, and now they are shamefully sucking up to them because the Tories want to go back on their promises to them.

    There are not many fraudulent claimants as they keep telling people, it’s all smokes and mirrors.

    1. Mike Sivier Post author

      I don’t think any elections were rigged – unless you’re saying the BBC was used as a mouthpiece for pro-Tory propaganda when it shouldn’t have been.

    2. Mam Bach

      I think I’ve spotted the difference! “Some of the money was paid direct to plebeians for their small businesses instead of subsidising our rich mates to try and put small people out of business, who do they think they are, earning a living without making us richer!’

      Over paid doesn’t mean here ‘more than they were entitled to’ just ‘more than we wanted to pay’

  2. daijohn

    No matter what it would appear the DWP is quids in if we consider the amounts of benefits that go unclaimed. A quick look at the figures for 2012 reveal the amount to around 6.75billion. This is never given much publicity (media only interested in scroungers and frauds) and we don’t learn what happens to the unclaimed amounts.

  3. marcusdemowbray

    Aha, here we see the start of the Government’s plan to give Tax Credits a bad public reputation, just like they did with Disability Benefits : make the public believe that fraud is FAR more common and expensive then most of the public will turn a blind eye to any cuts. I have been waiting for this, but surprised they were not doing it a year or two ago.

  4. Michael Broadhurst

    all the money that isn’t paid out unlawfully due to sanctions etc,couldn’t be so there is
    more for this crooked govt and their rich pals to cream off is it ?
    or is this just too simplistic ?

  5. Neilth

    So the story here is that more money is overpaid due to incompetence than due to fraud but that overall less money is overpaid than expected. Also significant amounts of money are underpaid without taking regard of all those people who don’t claim anyway.

    Finally the total amount of money fraudulently claimed as tax benefits is a small fraction of the total amount defrauded from the system by big business through tax dodging. But the media still want to make a bigger deal of benefit fraud than tax fraud.

    Or have I missed something?

  6. Teresa Parry

    Example of overpayment (true)
    Claim for WTC £53 per week
    2 months later lump sum paid, £500, weekly payment reduced to £30 odd, no explanation
    Job ends, £500 overpayment demanded back

    Is this fraud?

    Happened every year of claiming. To avoid this ask for weekly payments. 🙂

    You couldn’t think up a more stupid system!

Comments are closed.