Benefit fraud prosecution rates

The Public Accounts Committee has taken HMRC to task for its low prosecution rates.

Edward Leigh points out that the DWP are prosecuting 60 cases per thousand benefit fraud cases, while HMRC prosecute two cases per thousand hidden economy cases. "I am not suggesting that you should rise (sic) to the level of 60 per thousand", he says.

HMRC point out that prosecution is dearer for tax fraud than for benefit fraud. We may leave other blogs to their moral indignation at the logical consequences of these numbers.

The DWP's prosecution rate, though higher, is still shockingly low. The chance of being prosecuted for tax evasion is "tiny". The chance of being prosecuted for benefit fraud is also tiny.

Hence the DWP needs other ways to discourage people from committing the offence. One way would be to legislate for stiffer sentences. We often see ridiculously light sentences for benefit fraud.

People convicted of benefit fraud who don't receive a custodial sentence should have to do unpaid work. Benefit fraudsters should also have to repay twice the amount - and should not be eligible for further benefits or tax credits until they have.

The DWP has publicity campaigns claiming there is no hiding place for benefit fraudsters - plainly untrue. They would carry more weight if the administrative penalty for benefit frauds was 100% - with disqualification from benefits and tax credits until the backlog and the penalty had been met.

We are not talking here about innocent people getting understandably enmeshed in regulations which are too complicated for any ordinary mortal to understand. We are talking about deliberately defrauding the system.

There needs to be a simple, clear tariff which people can understand. Give a three month amnesty. During that period people could confess under the present arrangements.

Then the new arrangements could be introduced. Under administrative penalties you will have to repay twice the amount - and will not be eligible for further benefits or tax credits until you have. If you are prosecuted, the same tariff will apply. But in addition, you will have to do unpaid work if you don't receive immediate imprisonment.

Expect then benefit fraud to fall from its present £2bn+ a year.