HC Deb 11 January 1977 vol 923 cc440-2W


Statement by Mr. Stanley Orme, Minister for Social Security

Mr. Stanley Orme, Minister for Social Security, today (Tuesday) issued the following statement: Before the case of Derek Deevy hit the headlines in July David Ennals had asked me to review our Department's response to social security fraud and abuse. This must be a thorough-going and continuing exercise—there are no quick and easy solutions—but I can now report progress on the action plan I set out in my statement of 29 July. The Secretary of State for Employment (Albert Booth) has welcomed my inquiry and our two Departments are working closely together in tackling this problem. We are taking account of all the constructive representations we get, but sweeping allegations without factual foundation are useless. First of all, what about the Deevy case? Deevy had exploited the supplementary benefits scheme—until he was caught and sent to prison for six years—by running a number of false identities over a long period. Deevy had produced credible documentary evidence of his various identities and where we failed was in the frequency and effectiveness of the visits paid to the homes of his fictitious claimants. We are never likely to have sufficient staff resources to enable us to visit all our claimants as often as we would like—both to look after their welfare and to check against possible fraud—so we are going to concentrate on the selective follow-up of certain types of claim where the risk of deception is more likely. We shall be tightening up on identity checks and seeing how we can improve the arrangements for issuing National Insurance numbers to new applicants; we shall be looking particularly at the bona fides of adult males who might be expected to have had an employment record but claim not to have worked before. For obvious reasons, we shall not spell out in public the details of our plans. We need the element of surprise; the spot check, the unexpected interview, the off-beat home visit. But making false claims for non-existent claimants, as Deevy did, is only one way of cheating the community. Our action plan therefore goes much wider. The specialist branch we set up last year has been strengthened and is working on some 30 projects, some of them aimed at better detection; others are concerned with prevention. The growing success of the detection work in both Departments is reflected in the number of successful prosecutions—over 15,000 in 1975, more than double the 1970 figure. The 1976 figures so far are well up on 1975 and every week about 1,000 new cases are being investigated. But the more successful we are in bringing the offenders to court the more we can expect to read in the press about social security fraud. However, prevention must be our prime objective. We must strive to outstrip the ingenuity of those who set out to defraud our schemes with our own expertise in anti-fraud techniques. The scale and complexity of our operations—18 million payments a week spread over a wide range of benefits—puts an enormous burden on staff of DHSS and DE local offices, as recognised from the annual report of the Supplementary Benefits Commission, just published. This is one of the main reasons why the Secretary of State announced last week that he has put in hand a special review of the supplementary benefits scheme. Certainly our hard-worked staff are as anxious as anybody to see that the benefits go to those who are entitled to them and not to those who are out to swindle their fellow citizens. But operations on this scale have to be subject to systematic routines. Claimants get to know the system and those who are dishonest can learn to work it to their advantage. There is no doubt that simplification of the scheme would help to combat fraud and abuse. The number of DHSS and DE special investigators working in the field on the most difficult cases has been increased from 300 in 1970 to 471 and we have recently strengthened our Headquarters specialist unit on both detection and prevention. Despite severe restrictions on manpower there is no question of reducing the number of fraud specialists. On the contrary we shall aim to increase their numbers still further if we are satisfied that more are needed. But there is more to be gained in the short-term by developing new techniques and deploying our existing specialist skills to the best advantage. Our fraud specialists are playing an increasingly effective part in the detection and prosecution of organised criminal gangs who have set out to swindle the public by drawing benefits to which they are not entitled. Five members of one such gang in the Midlands were sentenced to terms of imprisonment of up to seven years; 16 defendants are now awaiting trial at the Old Bailey on charges of systematic fraud. Special anti-fraud drives based on local knowledge and initiative, are proving successful in uncovering fraud in particular places and occupations where there is reason to suspect that people are working on the side while claiming benefit. In recent months successful action has been directed not only against claimants engaged in various forms of casual work but against some in full-time jobs. The collusive employer is one of the targets to which we are turning our attention and we shall not hesitate to prosecute employers as well as claimants where there is evidence of collusion to defraud the community in this way. Any employer who is up against unfair competition of this sort should let us know. All specific allegations of fraud are investigated. Finally, let me repeat that there is no reason why social security fraud and abuse should be a party political issue—unless there are some people about who, for reasons of their own, want to make it so. It is not a new problem but we are doing more than any previous Government to tackle it effectively. We are determined to take the most rigorous action against fraud and abuse, but we are not prepared to be driven into a witch hunt, damaging to the social services and harmful to good community relations. We must see to it that vulnerable minorities who themselves contribute greatly to the life of the country do not become the victims of a wave of hysteria. Ordinary people have the right to be treated decently when they are hit by sickness or unemployment or injury at work. They must not be discouraged from claiming benefits that are theirs by right because social security is brought into disrepute by the behaviour of an unscrupulous minority. While we welcome support from any quarter to help us rid our schemes of swindlers we are not going to allow the Welfare State to be undermined either by them or by those who for political ends use the existence of fraud and abuse as a pretext for attacking the whole concept of a fair, compassionate and caring society.

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