Walking home from the supermarket I noticed one of those awful posters that point the finger of suspicion at so-called benefit fraudsters. Timely then that figures released by the DWP show that more than £1bn of total benefit expenditure was underpaid last year. Between April 2007 and March 2008, £2.6bn, or 2%, of total benefit expenditure was overpaid during the year due to fraud and error.
However over the same period – and even discounting those claimants who are entitled to benefit but who do not apply and those whose applications are incorrectly refused – those who made a claim for benefit and were made an award were underpaid £1.1 billion.
So that figure doesn’t include people who didn’t apply for a benefit but were entitled to and those incorrectly refused. I assume then the figure would be much higher if they were included in the figure. And I bet many people are put off from applying for benefits due to the bureaucracy, the form filling is a total minefield, fear that they may be refused, conditionality, the various obstacles and hoops (voice risk analysis, for example) people have to jump through to prove their entitlement to a meagre benefit.
The figure includes underpayments of income support and JSA of £130m; £120m of pension credit; £190m of housing benefit; £250m of disability living allowance; £150m of retirement pension; and £50m of incapacity benefit. In March ’08, the Local Government Association estimated that claimants are missing out on council tax benefit worth £1.8bn ‘cos the rules are complex and poorly advertised.
Even with overpayments due to error and fraud at £2.6bn, lets put that into some perspective by looking at how much is lost due to tax avoidance and evasion. It is estimated that £105bn is lost through both tax avoidance and tax evasion.
What is lost through benefit fraud is a drop in financial ocean compared to tax evasion and tax avoidance. And as so much revenue is lost through tax avoidance and evasion where are the posters pointing at these fraudsters? We know where Brown’s loyalities and priorities lie with the banking bail-out and scapegoating the poor regarding benefit fraud is so much easier than targeting the rich and powerful!
The spotlight falls on the poor in this society, the claimant who is trying to make ends meet by taking on some work whilst not disclosing it to the state and the rich and powerful who have the luxury of not having to worry about money but get away with tax avoidance and evasion cos they can.