Latest Public Sector News

14.11.13

A quarter of councils detect three-quarters of all fraud

Local government uncovered £178m of fraud last year, the Audit Commission’s new report indicates. ‘Protecting the Public Purse 2013: fighting fraud against local government’ found that three-quarters of this fraud was detected by a quarter of councils.

The average value of fraud increased by 15% in 2012/13 to around 107,000 cases, but the total number has fallen by 14%. Regional variations exist, with significantly lower numbers of fraud detected outside of London. Additionally, 79 district councils detected no non-benefit fraud at all.

The report recommends that local government should actively pursue potential frauds identified through participation in the National Fraud Initiative (NFI); actively promote a vigorous counter-fraud culture; develop a clear strategy to tackle fraud, by reviewing their own counter-fraud strategies; and to work in partnership, exploring joint working.

Councils should also allow sufficient resources to tackle fraud and improve the use of data to measure their performance, while the DCLG should consider extending powers for councils to investigate all frauds.

Jeremy Newman, chairman of the Audit Commission, said: “The top quarter of councils lead the way in the fight against fraud. This shows what can be achieved.

“It’s difficult to isolate the specific factors that cause variations between organisations in the level of detection of different types of frauds. This will be influenced by the actual levels of fraud available to detect, differences in the services that bodies provide and their local approach to prioritising and tackling fraud. However, not to detect a single case of non-benefit fraud does raise concerns about the priorities and resources in those councils to tackle fraud.

“I would urge all councils to review their local policies to ensure they are doing all they can to detect and record fraud cases. Our report has many examples of what can be achieved by councils who acknowledge the scale of the problem and apply appropriate and proportionate resources to tackle fraud.”

Cllr Peter Fleming, chairman of the LGA's Improvement and Innovation Board, warned that plans to transfer fraud staff to a proposed national benefits fraud agency could compromise councils’ abilities to tackle non-benefit fraud.

But he added: “We have worked hard to ensure councils share knowledge and the best ways to tackle fraud and the good work being done across the sector, such as with social housing fraud, highlights this. Local authorities firmly believe it is important to account for every penny of public money and as a sector we are resolute in our determination to stamp out fraud.”

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