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Fraud fears over Universal Credit – MPs

Changes to the IT system for Universal Credit could make it harder to distinguish fraudulent claims, a communities and local government committee report has warned.

Universal Credit will be implemented from October. The report raises concerns that as the system will not work from local authority property databases, it will not be able to automatically detect when several people make a housing benefit claim for the same property.

The committee also highlighted the possibility of experience local authority housing staff leaving due to uncertainty over future prospects, and called for Government to provide adequate administration funding to manage the transition.

The change to UC could also result in increased rent arrears, as housing support will be paid directly to tenants instead of landlords. The committee urged Government to give a clearer definition of the circumstances under which a tenant would be considered ‘vulnerable’ and have rent paid directly to the landlord.

Clive Betts, chair of the committee, said: “The Government must act to provide assurance that the benefit system will not be left vulnerable to fraud either during or after the transition. And it must do so urgently.”

A Department for Work and Pensions spokesman said: “Universal credit will cut benefit fraud by £200m a year and we are confident that our IT systems will be strong enough to protect us from the threat of fraud.

“We have been running pilot projects with local authorities to ensure that those people who can't manage with monthly or direct payments get the support they need.”

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