Sunday, 6 April 2014

Benefit Fraud: The Truth Still Hidden

 

The Telegraph and the Daily Mail carry stories of a ‘crackdown on benefit cheats’ but through (deliberate?) omission and conflation the truth is hidden.  A quick look at the government’s figures show all is not as the Telegraph and Mail would have us believe.

Indulge me whilst I take a short trip through the lies to the truth.

 

Omission and Conflation

Let’s look at the Telegraph headline,

Telegraph 1 20140406

The story focuses on upcoming attempts to reduce fraud but, as the article develops, the link between ‘fraud’ and ‘error’ is lost!  See what happens in the next clip.

Telegraph 9C 20140406

There in the last sentence we have the transformation: 2.1% is now lost to fraud.  The error has disappeared.  The omission of ‘error’ has allowed the conflation to be complete.  Losses are now about fraud.

NO!   LIES!

The truth is not hard to find.  The government’s own figures are clear.

 

Truth

In January, the government published two documents (a 4 page summary and the 128 page full report) which detail overpayments due to fraud, claimant error and official error and underpayment due to error, claimant and official.

Strange that!  There is no mention of any underpayments by the government in their speeches and policies!

The report estimates that £3.5 billion is lost due to fraud and error but what is the breakdown?  This is where it gets interesting.

Benefit1

So fraud is not £3.5 billion but merely? £1.2billion, just 0.7% of total benefits. 

Twice as much is overpaid by error, either by official error or by claimants inadvertently giving inaccurate information.  But we don’t hear about this, do we?  It’s benefit cheats and benefit fraud which assail us.  The Telegraph lists some of the ways in which fraud will be tackled.  Where are the efforts to reduce the errors?  You’ll not find them, other than part of one sentence which lists a ‘spot fine on those who mistakenly and carelessly provide inaccurate information’, because it suits government, and its supporters, to have us think the losses are all due to benefit cheats.

But, however we look at the it, there is still an overpayment of £3.5 billion.  We, because it’s our money, are out of pocket to £3.5 billion pounds.

No!

Current methods already recover £900 million and so the current overpayment loss is not £3.5 billion but £2.6 billion.  The government figures give no breakdown of where the recovery comes from, whether it be fraud or claimant error or official error.

So we’re out of pocket to £2.6 billion pounds?

No!                 Why not?

Well, not only do claimants and officials make mistakes which result in overpayment of benefit there are errors which cause underpayment.  What do the government figures have to say about this?

Telegraph 11 20140406

The estimate for benefit underpayment is £1.5 billion.  But does the government mention this?  Don’t be silly!  Of course they don’t.  This doesn’t fit their storyline.  More is underpaid than is paid fraudulently!

 

Therefore what we now see is that the effective loss to the Treasury is not £3.5 billion and not £2.6 billion but £1.1 billion from all causes (i.e only 0.66% of the total benefit expenditure)

 

So

-  benefit fraud is not worth £3.5 billion but £1.2 billion

-  errors cause twice as much overpayment as fraud

-  current recovery methods bring in £0.9 billion

-  errors cause underpayment of £1.5 billion, more than is claimed fraudulently

-  the effective total loss (all causes) is £1.1 billion and not £3.5 billion (3.5 – 0.9 – 1.5)

-  the effective total loss (all causes) is 0.66% of total benefit expenditure

 

The effective total loss is still a huge amount but the perspective changes when one considers the effect of errors, recovery and underpayment but we’re meant to see this in one way only: benefit cheats deny this country £3.5 billion.  This allows the government to focus its actions on fraud and not error, and on allowing genuine claimants to be seen as fraudsters.

 

But the government isn’t always so focused on loss.

We mustn’t forget how blasé the government is about the mis-selling of Royal Mail:  £2 billion pounds could have been lost.  £2 billion pounds but it’s gone to their pals.

 

More importantly  no mention is made of a much bigger issue: unclaimed benefits.  These dwarf all benefit losses.  Last year Channel 4’s factchecker site estimated that there were unclaimed benefits of £12.3 billion. 

That’s right!  £12.3 billion

and I don’t see much effort being made to ensure that we claim that to which we are entitled. 

All that matters is fraud.

All that matters is creating ‘us and them’.

And they are succeeding … in some parts, at least.

Truth?  It’s far too difficult a word for this government to know.

 

As long as we are part of the UK let us fight their lies and their policies and, when we are independent, let us ensure that Scotland never follows their lead.

3 comments:

  1. Its a big problem in this country!

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  2. Benefit fraud is taking hard working tax payers money. Regardless of the governments immoral actions it is still wrong! Although it is admittedly a lesser loss of money than the high level tax evasion that goes on.

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  3. Do only hard working taxpayers have their money taken? Or does it not matter if others have their money taken?

    ReplyDelete