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DWP embarrassed by prisoner overpayments

Taxpayers fork out £13m to ineligible inmates

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The management of the benefits system has come under more pressure with the revelation that prisoners have been receiving millions of pounds in payments to which they are not entitled.

The taxpayer has handed out £13m of income support and Jobseeker's Allowance over the past three years, despite inmates not being eligible.

Figures released by the Department of Work and Pensions (DWP) show the total payout in 2004-05 was £7m - more than three times the amount recorded in 2002-3. More money could have been mistakenly issued through other benefits, but ministers have admitted they are currently unable to provide estimates.

Shadow secretary of state for work and pensions Philip Hammond, who tabled parliamentary questions to obtain the figures, said: "This is more evidence of Labour's bungled administration of our benefits system.

"It is shocking that prisoners are wrongly receiving benefit handouts at the British taxpayer's expense, when so many vulnerable families and pensioners are experiencing real hardship.

"We need a full and urgent account of how and why prisoners are being paid these benefits, a proper explanation of exactly how many have received them, and an account of what efforts have been made to get the money back."

Prisoners are not entitled to claim Jobseeker's Allowance - worth up to £57.45 a week - because they are not available to work while locked up. They are also ineligible for income support and pension credits, and generally cannot receive incapacity and disability benefits, the state pension, carer's allowance, industrial injuries benefit or maternity allowance.

Help with housing costs is only given to those on remand awaiting trial.

Pensions minister James Plaskitt admitted in his written reply that the government did not know how much had been wrongly issued in incapacity benefit, council tax benefit, or housing benefit. He added that there were "no estimates available" for how many prisoners had received money.

Most of the payments are thought to be the result of prisoners not informing the authorities that their circumstances have changed. There are currently no arrangements for the Prison Service to inform the DWP of when someone who may be a benefits claimant has been incarcerated.

A DWP spokeswoman said the figures were "estimates" based on small samples which had a "wide margin for error".

The spokesperson said the government had only started producing the data in 2002-03, and it was not yet possible to calculate mistaken payments of other benefits.

"We are determined to crack down on anyone who defrauds the benefit system. The idea that we are in any way complacent about this is just wrong. We are the first people to start counting it."

The spokesperson added that handouts to prisoners made up a very small proportion of overall benefit fraud - which has been falling.

In 2004-05 income support and Job Seeker's Allowance fraud was estimated at £290m, from an overall benefits spend of £110bn.

This article was originally published at Kablenet.

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