Rampant benefit fraud is officially a right-wing fairy tale
Benefit fraud against HMRC and the Department for Work and Pensions (DWP) is rife, if you believe right-wing newspapers and Channel 5 documentaries. But as the latest statistics show, it’s little more than a load of cobblers.
HMRC and DWP fraud: rampant?
HMRC has released [pdf] its estimates of benefit fraud and error for child and working tax credits for 2016/17. And the figures on benefit fraud and error are somewhat small.
HMRC said [pdf, p4] the total “level of error and fraud favouring the claimant” was £1.32bn; just 4.9% of the total tax credits bill:
In detail, it found that [pdf, p7]:
- Error favouring the claimant was £1.05bn; 3.9% of the total tax credits bill.
- Fraud favouring the claimant was £280m; 1% of the total tax credits bill.
These were HMRC’s “central” estimates. It produced [pdf, p7] higher and lower ones, to allow for error:
What’s more, HMRC noted [pdf, p22] that the figure has decreased over time:
Who are the real scroungers?
But what of DWP benefit fraud? The kind the Daily Express would have you think was rampant?
Like HMRC, the DWP also estimates fraud and error for its benefit payments. Its most recent estimate shows [pdf, p3] that overpayments to claimants in 2017/18 were £3.8bn, or 2.1% of its total bill. Of this, 1.2% (£2.1bn) of its £177.5bn budget was claimant fraud.
Meanwhile, HMRC estimated the amount of tax avoided, evaded, or unpaid by people and companies in 2015/16 was £34bn – more than the whole tax credits bill.
So – who are the real benefit scroungers? Possibly not the people the right-wing media would have you believe.
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