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An enforcing council

Source: PSE Jun/July 15

PSE talks to Cheshire East’s Cllr Les Gilbert, cabinet member for communities, about the authority’s counter-fraud focus and deterrence-based communications strategy.

In the year to 31 March 2015, Cheshire East Council prosecuted 63 cases of fraud relating to housing benefit, council tax benefit and council tax support – and got a conviction in every case. It secured repayments and orders for repayment totalling £1.21m. 

The council wants to be – and be seen to be – an ‘enforcing council’, with zero tolerance of benefit fraud. 

Cllr Les Gilbert, cabinet member for communities, told PSE: “One of my specific responsibilities is enforcement activity generally. I don’t know how many other councils have that specified responsibility for one of their portfolio holders, but we certainly do here. 

“We don’t see benefit fraud as a victimless crime. We see it as fraudsters effectively dipping into the bank accounts of honest taxpayers. That’s why we take such a dim view of it.” 

In the first five months of calendar-year 2015, the council has identified more than £391,000 in fraudulently claimed housing benefit, council tax benefit and council tax support, and has identified other benefits falsely claimed and paid as jobseekers’ allowance and income support. “We expect all of those sums to be recoverable,” Cllr Gilbert told us. 

As well as prosecutions for the most serious cases, the council also has the option of issuing cautions – a verbal reprimand issued when the amount involved is low, the period of the offence short and where the person has cooperated with the investigation and has admitted the offence. It can also issue administrative penalties, when the offence is more serious, is over a longer period of time and when the claimant has the means to repay it. This involves the person paying back a percentage of the overpayment on top of the entire overpayment itself, or facing prosecution.  

Counter-fraud team 

“We do have a team of qualified investigators, unlike some councils who I understand no longer maintain such a team,” Cllr Gilbert said. “They are skilled and qualified at what they do. 

“Enforcement couldn’t work effectively without multi-agency working. For example, we work with the DWP (Department for Work & Pensions), HMRC (Revenue & Customs), various council departments come together and share information, as well as other councils, police, the Charity Commission and so on. Often the fraudsters are known to more than one of these agencies, and multi-agency working obviously throws up a lot of offending. Information sharing, as far as data protection allows, is absolutely essential to the success of our strategy. Data-matching plays a very important role in the way we approach it.” 

Transfers of local authority staff into the new Single Fraud Investigation Service (SFIS) began last year and will resume in October 2015 until March 2016. About 800 council staff from across the country will transfer, as will 80 from HMRC. Staff from Cheshire East will be transferred later this year, Cllr Gilbert told us.  

The Fraud and Error Reduction Incentive Scheme, launched last year, financially rewards councils that manage to cut housing benefit entitlement as a result of claimant error or fraud. Virtually every council has opted into this, including Cheshire East, which successfully bid for £28,938 from the bid fund towards staffing costs, on top of what it is allocated for meeting various thresholds and from the start-up fund. 

The Commons Public Accounts Committee released a report into housing benefit fraud and error earlier this year. Its then chair, Margaret Hodge MP, called it “completely nonsensical” that the DWP spends only 8% of its ‘fraud and error’ budget tackling housing benefit, when overpayments in that category account for 42% of total benefits overpayments. 

Cllr Gilbert did not want to comment on the allocation of resources at a national level, but did say: “We apply such resources as we think are necessary to maintain an effective investigation service.” 

Out-performing its peers 

A benchmarking exercise conducted last year by CIPFA (the Chartered Institute of Public Finance and Accountancy) shows that Cheshire East – compared to its peer authorities – brought a higher than average number of prosecutions, and the number of sanctions it imposes has risen by a further 12% since then. 

Cllr Gilbert told us: “We are very proactive and are maintaining our efforts to defeat fraudsters. In a recent case, a Crewe woman faces a bill of £53,000 in repayable benefits. That was seen by over 3,000 people on Facebook, a lot of whom ‘liked’ it. 

“It’s key to our strategy that we publicise our activities and that every prosecution – as far as we can influence what the press prints – is actually reported. That is because we think the deterrent effect is very important, and it has to be well-publicised. We also have to make people aware that if they’re fraudulently claiming benefit, the pal they’re having a pint with might well take exception to it and report them using our confidential hotline.”

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