HL Deb 12 March 1996 vol 570 cc59-60WA
Earl Russell

asked Her Majesty's Government:

Further to paragraph 3 of the Government's reply to the Fifth Report of the House of Commons Select Committee on Social Security, whether they will give details of the Post Office reward scheme introduced in October 1995, how many rewards have been given, what has been their average size, how much money has been recovered, and what measures are in place to monitor the accuracy of the information given before any reward is paid.

Lord Mackay of Ardbrecknish

The Post Office reward scheme offers a financial incentive to Post Office clerks to prevent the fraudulent encashment of order books and girocheques, beyond their contractual obligation to the Benefits Agency (BA).

The Post Office reward scheme was introduced on a national basis in October 1995, following a limited trial in the Birmingham area, and a wider trial in the Midlands area.

Since the national scheme began, 16,339 rewards have been paid. The standard reward is £10, although there is the option to make an award of £25 for exceptional cases, for example where a Post Office clerk has taken action which leads to a prosecution. Eight rewards of £25 have been paid.

The face value of the order books and giro cheques recovered to 29th February 1996 is £8,156,288.

A number of procedures have been put in place to ensure that rewards are properly paid:

  1. (1)The reward application form must be accompanied by the order book or giro cheque when it is received by the BA.
  2. (2) The application form and order book or giro cheque are checked by local BA fraud investigation staff prior to acceptance of the application. Applications are considered under various criteria, which are known by both Post Office clerks and BA staff. Once checked the application forms are sent to a central BA rewards centre.
  3. (3) Payment is made from the centre, where the application forms are checked again on receipt. The forms are also subject to further random security and management checks during the recording and payment authorisation processes. The rewards scheme itself is also subject to scrutiny by the BA internal audit unit.