§ Mr. Evennett
To ask the Secretary of State for Social Security what further studies he has made to measure the amount of benefit fraud; and if he will make a statement. 
§ Mr. Burt
My right hon. Friend, the Secretary of State, announced in July 1995 that he had instigated a series of benefit reviews across the major social security benefits to identify and quantify the level of fraud and error. Results of the reviews of income support, unemployment benefit, housing benefit, retirement pension and invalid care allowance have already been announced.
A review has now been completed on disability living allowance, a benefit which is paid to disabled people to help with some of the extra costs associated with disability. Not all disabled people satisfy the conditions for an award of DLA, which is based on the care and mobility needs arising from the effects of a disability rather than on the disability itself.
The review shows that some 73 per cent. of customers are entitled to the DLA they are receiving. In 27 per cent. of cases, therefore, DLA is being paid at an incorrect rate. Reasons for incorrectness, which involved both underpayments and overpayments of DLA, ranged from departmental or customer error right through to deliberate fraud.
In 12.2 per cent. of the cases surveyed, officials considered that customers did not satisfy the qualifying condition for receipt of either all or part of the benefit in payment due to their deliberate overestimate of their care or mobility needs or failure to report an improvement in their condition. Grossed up from the sample this represents an estimated annual overpayment of £499 million.
In addition there was a further 3 per cent. of customers who were found by the review to have been overpaid but where they might have been unaware that the changes in their condition was such that they should have reported it to the Benefits Agency. These represent an estimated annual overpayment of £83 million.
The exercise also identified another 9.3 per cent. of customers who were not receiving the appropriate rate of benefit because of an unreported deterioration in their condition. This represents an estimated annual underpayment of £227 million.
The results of this exercise will be studied and will help to inform plans to tackle incorrectness in DLA.251W
Customers who are entitled to the benefit have nothing to worry about from the findings of this exercise. But there are changes in medical conditions which can affect that entitlement level. The nature of some disabilities is such that there can be improvements where care or mobility needs, or both, become slight or non-existent. Customers have a duty to report such subsequent changes in their condition to the Benefits Agency and this requirement is clearly set out to customers when they receive benefit.