Plans to deliver multi-billion pound savings to the spiralling welfare budget through the Universal Credit programme could be put at risk because central government lacks a clear plan for managing the housing benefit element of the flagship welfare reform, MPs have warned today.
A report from Commons Work and Pensions Committee finds UC has the potential to help slash the £3.5bn lost to fraud and error across the benefits system – which paid out £166bn last year to claimants - through linking tax authorities PAYE information with IT systems managed by the Department for Work and Pensions in real time.
But spending watchdogs the National Audit Office have noted the service allowing civil servants to cross-check data and spot fraud is not as strong as procedures run by councils within the existing Housing Benefit system, the MPs reported.
The new Whitehall IT system, the Integrated Risk and Intelligence Service (IRIS) is ‘missing’ form the existing 12 UC pathfinder pilots and there is no clear plan to use property data available to local authorities within the counter-fraud initiative.
Dame Anne Begg, chair of the Work and Pensions Committee said: ‘Through the use of RTI – real time information on PAYE earnings – Universal Credit has the potential over the longer term to substantially reduce fraud and error in the benefits system.’
‘However, this could be seriously undermined because of the uncertainty about how DWP will administer the housing element of Universal Credit without risks of fraud and error,’ she added.
Dame Begg continued: ‘Under the current housing benefit system, local authorities can cross-check claims across a range of data relating to other council services.
‘Unless DWP is able to cross-check Universal Credit claims in a similar way it may be less effective in tackling fraud and error,’ she added.
The MPs concerns will add to mounting fears that the Coalition’s flagship welfare policy, which amalgamates six separate benefits into one monthly payment for claimants to self-manage online, is in danger of joining the ranks of Government IT disasters.
Last year the Commons Public Accounts Committee lambasted the DWP’s attempts to harness technology to deliver the welfare reform as ‘extraordinarily poor’ after it emerged £140m out of £425m spent on the programme’s underpinning IT would be written off.
