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Out-of-date IT makes it harder to tackle benefit fraud and error

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The Department for Work and Pensions is hampered by out of date IT in tackling benefit fraud and error, says the National Audit Office.

The spending watchdog's report on minimising the cost of administrative error in the benefit system, published on 25 November, says the Department for Work and Pensions (DWP) has 140 core processing systems. Many of its computer systems are relatively old and not well-linked to others.

The department's IT situation is such that systems are difficult to update and information is not readily accessible by different systems.

"Even relatively small changes to systems can be problematic," the report says.

The department is one of the biggest IT spenders in Whitehall, with an annual budget of around £1bn.

The NAO asked the department to consider introducing a "double-keying requirement" to reduce error, where staff would be prompted to re-enter values to compare and check for data consistency.

The department's response, however, was that the necessary changes would be "complex and the feasibility work to provide even a rough estimate of costs would be significant".

Benefit processing systems are not designed in a way that allows simple changes to the screen display, the watchdog was told. To add a new data field would require significant work to ensure the processing code understands the messages being keyed in.

But without these routine validation checks on the accuracy of data input, there remains the risk of transcription or typographical error.

Although the department is continuing to work on system "fixes", the overall impact on administrative error is likely to be limited until it is able to integrate its processing systems.

Agencies of the department Jobcentre Plus and the Pension, Disability and Carers Service have set up internal advice lines for staff to clarify existing guidance and procedures.

Of the 5,000 calls received by the Jobcentre Plus advice line each month, 35 per cent concern IT.

The extent of fraud and error has been a longstanding issue for the department and it estimates that it made £3.1bn of overpayments and £1.3bn of underpayments as a result of fraud and error in 2009-10. The scale of incorrect payments has resulted in the DWP's resource accounts being qualified for over 20 years.

The NAO says there has been no discernible reduction in administrative error since 2007 when the department introduced a prevention strategy, which included better IT, the use of targeted checks and data matching.

The scale of the task is huge, encompassing more than 27 different benefits and a total caseload of around 20m people. In 2009-10, the DWP paid out £148bn in benefits and pensions to claimants.

"The government's recent announcement of the introduction of Universal Credit is an opportunity to simplify many of the regulations," said the NAO. "But such changes will take a long time to implement. In the meantime, the onus remains on the department to keep the costs of mistakes to a minimum."

This article was originally published at Kable.

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