21 July 2004 - Benefit Fraud Inspectorate (BFI) Report: Knowsley Metropolitan Borough Council
The Secretary of State for Work and Pensions, Andrew Smith has today published an inspection report by the Benefit Fraud Inspectorate (BFI) on the administration of Housing Benefit and Council Tax Benefit and counter-fraud activity by Knowsley Metropolitan Borough Council.
In 2002/03, Knowsley Metropolitan Borough Council administered some £70.8 million in housing benefits, about 19.3 per cent of its gross revenue expenditure.
BFI inspected the council against the Performance Standards for housing benefits. The report finds that since 2000 the council had implemented an ambitious programme of activity that included: the Verification Framework; new IT systems; a re-organisation of its Revenues and Benefits division; and the establishment of one stop shops and a customer contact centre. Many of the earlier changes were responsible for a considerable backlog of housing benefit claims, attributed to poor management and pointing to a lack of effective planning and organisation.
The report notes serious concerns about the lack of management assurance and public accountability provided by the Benefits service.
The council had received ‘Beacon Council’ recognition for its Accessible Services, providing public access at several one stop shops and handling all calls at its customer contact centre. There were however, concerns about its compliance with the Disability Discrimination Act and the Race Relations Amendment Act.
The council had made an impressive effort to clear a backlog of new claims resulting in the council's average number of days to process new claims to housing benefits being approximately 44 days, compared with the Standard of 36 days. However, the council was not consistently applying the standards required for gathering and confirming supporting evidence.
The report notes extreme concerns that the prosecution process used by Knowsley Council allowed customers to remain under caution for excessive periods of time. The council was however, making positive efforts to raise the profile of counter-fraud activity.
The council’s benefit overpayment policies and procedures were of a good standard and fraud overpayments were pursued rigorously. However, a backlog of over 20,000 items of Benefits post, contributed to high levels of avoidable overpayments. Sampling showed the average time taken to process changes of circumstances was 58.2 days, compared with the Standard of 9 days and that 70 per cent of benefit overpayments were caused by these delays.
Compared to the Performance Standards, the council was not at standard for any of the seven functional areas – strategic management, customer services, processing of claims, working with landlords, internal security, counter-fraud, and overpayments.
BFI is an independent unit within the Department for Work and Pensions that reports directly to the Secretary of State for Work and Pensions on the standard of benefit administration and counter-fraud activity.
Chris Pond, Work and Pensions Minister announced the publication of the report in a written ministerial statement.
Notes for editors
- The process for the inspection at Knowsley Metropolitan Borough Council included an initial fact finding stage, an on-site visit, and production and clearance of the report. The on-site visit took place during October and November 2003.
- The council's Benefits service had improved from a 'Poor' classification in December 2002 to a 'Fair' classification in December 2003 as part of the Comprehensive Performance Assessment programme.
- Each BFI inspection report is considered by the Secretary of State who decides whether any further action is appropriate. The Secretary of State has powers to issue directions to a local authority to secure acceptable or minimum standards in performance.
- In its response to the Housing Green Paper of November 2000, the Department for Work and Pensions developed a performance framework for housing benefits. The HB/CTB Performance Standards, published in April 2002, enable local authorities to make a comprehensive self-assessment of whether they deliver benefit effectively and securely. These are the standards that the Department for Work and Pensions expects local authorities to aspire to and achieve in time.
- The Department for Work and Pensions has not set a timescale for when the standards need to be met by local authorities.
- BFI inspects against the seven functional areas of the Performance Standards:
- Strategic management – clearly stated aims and action, resources and monitoring, with effective training and IT
- Customer services – providing an efficient and prompt service that meets the needs of all claimants and persons with a legitimate interest in a claim
- Processing of claims – speedy and accurate claims processing with effective verification
- Working with landlords – to give private landlords the confidence to let to claimants and to support delivery of social housing
- Internal security – preventing internal fraud
- Counter-fraud – deterring, preventing, detecting and pursuing fraud
- Overpayments – preventing, identifying and recovering overpayments.
- The HB/CTB Performance Standards can be downloaded from: www.dwp.gov.uk/housingbenefit/publications/2003.asp
- Media copies of the BFI inspection report can be obtained from the Department for Work and Pensions Press Office on: 020 7238 0866.
- All BFI inspection reports can be found on the BFI website – www.bfi.gov.uk.
Department for Work and Pensions press enquiries: 020 7238 0758
BFI press enquiries: 01423 83 2910
Out of hours: 07659 108 883
Public enquiries: 020 7712 2171