Audit Commission calls on councils to put National Fraud Initiative at heart of plans for tackling fraud

The Audit Commission has called on local authorities to ensure that its National Fraud Initiative (NFI) – which matches data within and between public sector organisations – is integral to their corporate arrangements for tackling fraud.

Releasing its report on the NFI’s activities in 2008/09, the Audit Commission said the scheme had helped trace £215m of fraud, overpayments and error. This was up 54% on 2006/07.

According to the Audit Commission, the NFI helped uncover £56m of council tax single person discount that was fraudulently or wrongfully received. It also said 97 properties were recovered for social housing, while 181 employees were dismissed or asked to resign because they had no right to work in the UK.

The Commission’s report on the NFI said local government should:

• Ensure all data sets are submitted to the Audit Commission on time
• Prioritise data matches and follow them up promptly and rigorously
• Promote awareness of the NFI among senior management and outside the finance directorate
• Engage elected members and non-executives more effectively in the NFI by nominating a lead member and through regular reporting
• Improve their expertise when investigating immigration fraud
• Recover previous year’s discounts when council tax single person discount has been wrongly awarded, and
• Improve communications between different departments, so that information about deceased persons is passed promptly to all those having contact with local residents.

The report also called on housing associations to take part in future NFI exercises “to show their commitment to fighting fraud”. The Tenant Services Authority should encourage all housing associations to participate, it added.

The Audit Commission criticised the lack of interest among central government in the NFI – no government department and only one government agency took part during the year.

The watchdog said it would develop the NFI by addressing new and emerging fraud risks, such as false claims for empty property discounts, abuse of blue badges and incorrectly enhanced personal injury pension payments to retired police officers and firefighters.

It also plans to place greater emphasis on fraud prevention, such as including housing waiting list data to prevent persons not entitled to social housing from obtaining a tenancy.