§ Mr. MilburnTo ask the Secretary of State for Social Security (1) what has been the number and value of(a) overpayments and (b) underpayments of income support in each year since its introduction; and what projections he has made of future errors; [17524]
(2) what action has been taken to correct incorrect income support payments; and what amount has been(a) recovered, and (b) compensated; [17525]
(3) if he will list his Department's estimate of the extent of incorrect income support payments by (a) region and(b) area. [17526]
§ Mr. Roger EvansThe administration of income support is a matter for Peter Mathison, the chief executive of the Benefits Agency. He will write to the hon. Member.
282WLetter from Peter Mathison to Mr. Alan Milburn, dated 25 February 1997:
The Secretary of State for Social Security has asked me to reply to your recent Parliamentary Questions asking what has been the number and value of (a) over-payments and (b) under-payments of Income Support (IS) in each year since its introduction; and what projections he has made of future errors; what action has been taken to correct incorrect IS payments; and what amount has been (a) recovered, and (b) compensated; and if he will list his Department's estimate of the extent of incorrect IS payments by (a) region and (b) area.The number and value of over-payments and under-payments of IS in each year since its introduction and future projections are shown at Appendix A.Incorrect IS payments are identified and corrected by means of routine checks and case-reviews, or in response to customer queries and appeals.In addition to routine procedures outlined above, there have been a number of special exercises, both national and local, to identify and correct errors made in specific categories of cases. Two major exercises for which specific records have been kept are a scrutiny of all mortgage cases and as a result of this exercise £77,865,018 million was recovered and £7,640,614 refunded to customers; and a scrutiny of live cases with potential entitlement to Severe Disability Premium and as a result of this exercise arrears of approximately £90 million were paid to customers.Since April 1991, the total of IS overpayments recovered is £345,180,580. These figures apply to overpayments resulting from a variety of causes, including fraud and customer error. Overpayments arising solely from official error are not normally recovered.Compensation is given for many reasons including misleading advice and delayed payment of benefit. Records were not kept prior to the inception of the Benefits Agency in April 1991. Since April 1991, the Agency has issued compensation of £18,659,361.87 to IS customers over and above normal benefit entitlement.Figures are provisional and subject to change.The estimate of the extent of incorrect IS payments by (a) region and (b) area is not available in the format requested. Information is available by Benefits Agency Area Directorates and Territories not by regions and is shown at Appendix B.I hope you find this reply helpful.283W
Appendix A: National Audit Office figures for income support error Overpayments £ million Underpayments £ million Total number of cases found to be in error 1988–891 125 35 587,925 1989–90 87.6 57.2 626,256 1990–91 115.5 69.7 609,008 1991–92 231.7 86.8 850,070 1992–93 465.2 136.2 925,025 1993–94 540.1 76.6 972,888 1994–95 546.1 182.7 925,911 1995–96 485.4 167.5 879,357 1996–97 363.5 131.7 — 1 These figures include income support errors, classed by the National Audit Office, as "non-cash" errors, which represent no overall financial loss or gain to the department, as they are offset by under or overpayments of another benefit. Figures for subsequent years exclude non-cash errors. Figures for 1988–89 to 1995–96 are National Audit Office estimates. Figures for 1996–97 are a benefits agency projection. Figures are provisional and subject to change.
Appendix B: Percentage of income support payment found to be accurate (1996–97 year to date) Area directorates (AD) Accuracy performance Per cent. AD 1 East London and Anglia 76.4 AD 2 Chilterns 78.0 AD 3 London South 76.3 AD 4 West Country 80.1 AD 5 Mercia 81.6 AD 6 West Midlands 82.0 AD 7 Wales 85.3 Southern territory total 79.4 AD 8 North West Coast 80.9 AD 9 Greater Manchester 81.2 AD 10 Yorkshire 81.5 AD 11 Tyne Tees 84.1 AD 12 West of Scotland 83.6 AD 13 East of Scotland 84.8 Northern territory total 82.6 Estimates of monetary value of error are not statistically valid at area level. Figures are provisional and subject to change.
Monetary value of error for 1996–97 projected by the benefits agencies quality support teams Underpayments £ million Overpayments £ million Total £ million Percentage of programme expenditure Southern Territory 100.6 287.3 387.9 3.5 Northern Territory 31.1 76.2 107.3 1.6 National 131.7 363.5 513.4 2.8 Figures are provisional and subject to change.
§ Mr. FabricantTo ask the Secretary of State for Social Security if he will make a statement on the conclusion of his review of income support direct payments announced on 19 July. [17970]
All recently retired pensioner units average income breakdown by quintile Quintile 1 Quintile 2 Quintile 3 Income source 1990–91 £ 1992 £ 11994–95 £ 1990–91 £ 1992 £ 11994–95 £ 1990–91 £ 1992 £ 11994–95 £ Investment income 4.50 21.80 4.70 8.10 9.10 7.20 18.10 23.20 11.20 Occupational pension 5.70 9.40 7.20 12.70 14.10 21.50 33.40 37.50 41.00 Gross income 96.60 121.80 105.60 114.00 124.70 137.70 162.50 176.10 170.00 Net income 84.70 95.90 97.20 102.60 115.20 127.10 143.40 158.60 156.50 1 Denotes a small sample size these estimates should be used with particular caution. 1. The figures provided are subject to statistical variability and should be used with caution.
2. All incomes quoted are rounded to the nearest 1op, at July 1994 prices. All average amounts are means except where otherwise stated. Components may not sum, due to rounding.
3. A pensioner unit is defined as a single person over state pension age or a couple where the man, defined as the head, is over SPA. A recently retired pensioner unit is defined as a pensioner unit where the head of the benefit unit is less than five years older than SPA.
4. Due to inadequate sample sizes, information cannot be given for recently retired pensioners by decile groups and recently retired pensioner couples for 1992 and 1994–95.
5. The family expenditure survey does not separately identify income from either personal pensions or state earnings-related pensions. Any personal pension details are recorded as investment income.
6. Quintiles have been constructed based on the equivalised before housing costs net income distribution. This is consistent with table 5 of "The Pensioners' Income Series 1994–95."
7. Comparisons of estimates from different years may not give reliable results. It is recommended that these estimates are used to indicate trends over time and that year on year comparisons should be avoided.
284W
§ Mr. LilleyI have completed my review of direct payments for fuel and water, which included consultation with over 60 interested groups including the regulators, utility companies and consumer groups.
I have concluded that the direct payments scheme continues to play an important role in protecting benefit recipients who might otherwise be at risk of having their fuel or water supply disconnected, and for whom no alternative payment methods are suitable, but it is clear that the scheme is used by some people who are capable of making their own arrangements with the utility company. Those who are capable of managing their own financial affairs should be encouraged to do so. I therefore intend to maintain the scheme for the foreseeable future, as a last resort measure to avoid disconnection, but to make more explicit the circumstances whereby direct payments remain appropriate.
I intend to introduce amending regulations to define more clearly the eligibility conditions for the scheme, and to agree with each utility industry a new code of practice on the application of the new rules.
Copies of the report of my review are available in the Library.