§ The Parliamentary Under-Secretary of State for Work and Pensions (Malcolm Wicks)The Benefit Fraud Inspectorate (BFI) inspection report on Oxford city council was published today and copies of the report have been placed in the Library.
The BFI published its first inspection report on Oxford city council in August 1999. The Department monitored Oxford's progress after the inspection but when the council failed to make progress, the BFI carried out a further inspection.
This follow-up report finds a substantial improvement in counter-fraud work, but serious weaknesses in housing benefits administration.
12WSThe council installed a new housing benefit IT system and a document image processing system at the same time as implementing the verification framework. The conflicting priorities were poorly managed. Measures to bring the work under control included unlawfully allowing claims to overrun the maximum benefit period of 60 weeks.
This report finds a substantial backlog of work and that performance had deteriorated since the first inspection in many areas, including claims processing and verification. The council also failed to ensure that all relevant claims were referred to the Rent Service, and the incorrect DWP subsidy was being claimed in respect of many homeless persons. A new overpayments recovery system proved inadequate and had to be replaced after a year, causing serious delays and rising debts.
The council has implemented all BFI's recommendations from the first inspection for counter-fraud work, which has improved substantially. However, prosecution of some fraudsters was impeded by the council's policy of allowing claims to overrun.
A new head of revenues and benefits had just been appointed at the time of the BFI follow-up inspection, and a restructuring of management and staff was under way. The poor performance in housing benefit administration had been recognised by the council and plans were progressing to address the problems, although it was too early for BFI to judge their effectiveness.
In 2000–01, Oxford city council administered approximately £39.4 million in housing benefits. This is approximately 33.8 per cent. of its total gross revenue expenditure.
The report makes recommendations to help the council address the remaining weaknesses and to further improve the administration of housing benefit and council tax benefit, as well as counter-fraud activities.
I am now considering the report and will be asking the council for its proposals in response to the findings and recommendations of the BFI.