Benefit claimants facing fines if they fail to report changes on time

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Saturday, 04 January 2014 10:37

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  By Anne-Marie O’Donnell

Benefit claimants are being targeted in a fresh government scheme which could see them landed with heavy fines if they fail to inform the Department for Work and Pensions of any changes in circumstances.

The pilot scheme has been introduced as a result of a rise in overpayments year-on-year from £1.2bn to £1.6bn – although the rise was attributed to errors with claims rather than deliberate fraud.

Claimants could now face fines of up to £2,000 if their claims are incorrect, leading to concerns that many will fall foul of the new rule at a time when government changes to the benefits system are likely to lead to confusion for claimants.

The latest campaign against welfare fraud – which costs the UK a fraction of the losses suffered due to tax avoidance, which is estimated to cost the economy in excess of £30bn per year – will pilot in Southwark, Hounslow, Blackburn, Blackpool, Epping Forest and Cardiff.

In a surprising move, The Labour party apparently backed the campaign from the Conservative-Liberal Democrat coalition government, saying that authorities must “get a grip of rising levels of fraud and error on their watch.”

Labour’s Shadow work and pensions spokesman Chris Bryant told the BBC: “Families facing a cost-of-living crisis will be astonished that levels of benefit fraud and error are going up under Iain Duncan Smith, with £700m overpaid a year due to official error.”

The UK government has commissioned an advertising campaign that will include posters, social media activity and letters, using slogans such as “Claiming benefits? Got a new job? Make sure you tell us. We’re checking benefit claims.”

The campaign will also target members of the general public, encouraging them to report anyone they suspect of committing benefit fraud.  Sources at the DWP have reportedly described the campaign as a “softer” approach in their fight against fraud.

The UK government is currently rolling out its new Universal Credit benefit system, a scheme designed to streamline benefits claims and simplify the process.  The implementation of the system will not cover the whole of the UK until 2016, meaning benefit claimants in different areas will be subject to varying application processes and criteria.

Minister for Welfare Reform Lord Freud said:  “We are keen to make sure that claimants know that even small overpayments can really add up over time, so they must get in contact with us and let us know about changes in circumstances straight away.

“The new pilot campaign will help us stop fraud and overpayments before they even happen.”

It’s not known how much the government spent on the advertising campaign. It’s the second approach to raise eyebrows in the last year. In July, the government faced a storm of controversy after piloting a billboard campaign in London telling illegal immigrants to “go home”.