16 September 2004 - Benefit Fraud Inspectorate (BFI) Report: Liverpool City Council
The Secretary of State for Work and Pensions, Alan Johnson has today published a second inspection report by the Benefit Fraud Inspectorate (BFI) on the administration of Housing Benefit and Council Tax Benefit and counter-fraud activity by Liverpool City Council.
In 2002/03, Liverpool City Council administered some £237.1 million in housing benefits, about 21 per cent of its gross revenue expenditure.
BFI inspected the council against the Performance Standards for housing benefits.
Although the report found that 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 – inspectors had noted continual improvement and that the Benefit service planned to be at Standard by the end of the year.
Following BFI’s first inspection in March 2001 the council had responded positively and initiated a major business transformation programme. This included the re-engineering of its business processes, establishing a working partnership to improve business services, implementation of new IT systems and full implementation of the Verification Framework. The establishment of a Customer Contact Centre with 24-hour access and One Stop Shops was providing an impressive and prompt service to callers.
The latest report found that the council had a clear vision for its Benefits service supported by policies covering the full range of benefit administration activities. However, inspectors found that historical problems had hindered the council’s ability to deliver an effective service.
At the time of the inspection in March 2004 a large backlog of work was seriously affecting the service. Delays in processing claims were undermining most aspects of the council’s Benefits service. New claim customers had to wait an average of 143 days for a claim to be processed. Delays in processing reported changes of circumstances had also resulted in overpayments being incurred unnecessarily by the council, which was a direct loss to public funds. These difficulties had been recognised by the council who had made a significant investment in staff resources to make improvements.
The report highlighted serious concerns about the total level of overpayment debt reported by Liverpool City Council. An estimated £3.5 million of outstanding debt had not been transferred from its old Benefits IT system.
The council had a credible and high profile Counter Fraud service, which was demonstrated by its application of the full range of sanctions available.
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 Liverpool City 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 March 2004.
- 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 April 2000, the Department for Work and Pensions developed a performance framework for housing benefits. The HB and CTB Performance Standards, first 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 2938
Out of hours: 07659 108883
Public enquiries: 020 7712 2171