from a job centre

what it's like to work in an inner city job centre

Monday, November 27, 2006

The Tax Credit fiddle.

I don't think tax credits are a very good idea. Not only do they encourage employers to pay low wages, (and some employers need no encouragement) but they are not well administered, and
there have been some appalling errors.
Towards the end of last year, those of us working at the DWP began to hear rumours that our identities had been used to make false claims for tax credits. On ringing the tax credit helpline, we were informed that we could be told nothing, but that our enquiries would be noted, and passed to a superviser for further action. Since our management were concerned that we did not use any of the corporate systems available to the DWP to check our personal information, (why not?) some of us exercised our right under the Data Protection Act to see all the information held on us by HM Revenue and Customs, which manages the tax credit benefit.
On our internal web site, we were informed that about 8,800 staff identities had been stolen, and that 6,8oo of these had been used in an attempt to defraud the tax credits system. Staff information was also stolen from Network Rail, I don't know the number of staff involved there.
While this is not particularly surprising in itself, (there are three inevitable things in this world, death, taxes, and people being on the fiddle) what is shocking is the ease with which the fraud was apparently carried out. Claims to the tax credit benefit were made online, and no checks appear to have been made.
In my own case, the claim was made with my name, national insurance number and date of birth. Although we had been assured that our home addresses had not been stolen, mine was there, and it had been changed to a town that I have never even visited, let alone lived in. Did no one check the address? The fictitious me ran a little business from home, but was unable to make much money because she was severely disabled, and claimed the highest rate of Disability Living Allowance. How could someone who is perfectly healthy be on DLA? (That was a silly question, actually, it happens all the time). But did no one ask for proof that I was, in fact, receiving it? Or for proof that I had a child? (I've never had any children). A new bank account had been opened for me, (did the bank do no checks?) and into it was paid my tax credit benefit, about £1,8oo.oo in all. (The fictitious me was entitled to more that £100.00 per week). Not very much from me perhaps, but we were informed that the overall loss from the fraud was limited to an estimated £2.7 million. What's a couple of million pounds here or there?
But when the initial claim was received why did no one check whether I was already employed? My national insurance number was there. They would have discovered that I was not in fact entitled to any tax credit, as I was already employed full time, and earning a reasonable wage. I have never claimed any tax credit, but some of our staff do, and were told that they should not worry because: 'The design of the system maintains the existing payment when a second claim for the same national insurance number is made!!!!!!!!!' What is the point of a system that relies on people being honest, when so many of them are not?
What's really shocking, however, is the way that nothing seems to have been done about this, nobody called to account over it. It's as if £2.7 million of money paid by the taxpayer can be written off, with no problems at all.
However, when you consider that in the financial year 2004-2005 the DWP paid out £113.2 billion pounds, in the financial year 2005-2006 £118.2 billion pounds, fraud and error accounts for nearly £3 billion pounds, and the accounts of the DWP have not been qualified, (from our internal web site) perhaps it really doesn't matter very much. There's always plenty more money where that came from, after all!

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