Universal Credit Fraud

Baroness Sherlock Excerpts

Wednesday 10th July 2019 Lords Chamber

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for repeating that Answer. Claimants need these advances because they have to wait five weeks to get their universal credit in the first place, and that money must be repaid. Now the BBC tells us that tens of millions of pounds have been stolen in fraudulent advance claims. It saw DWP messages on an internal forum describing lots of suspicious claims, from a 19 year-old with six blind children to those inventing street names or people, where the landlord was called Harry Kane and the kids were Homer, Bart and Lisa.

In other cases, a genuine claimant has been conned into giving their details to someone who says that they can get them a government grant or payday loan. Instead, that person applies for universal credit in the claimant’s name, and they find out only when they are taken off their old benefits and put on to UC; the claimant then finds themselves worse off and may have to pay back a debt of £1,500 in the bargain.

Can the Minister tell us two things? First, assuming that the Government are not about to stop the rollout—which I think they should—where a legacy benefit claimant was scammed and a UC claim was made without their knowledge, will the DWP allow them to return to legacy benefits, especially if they are worse off? Secondly, eight leading banks have signed up to a new code to reimburse victims of fraud on a no-blame basis. Will the DWP do the same?

[Baroness Buscombe]

My Lords, I repeat that we take this issue incredibly seriously. First, there is no question of us stopping the rollout; we will not. It is already completed in that it is now in every jobcentre in the country. The termination of legacy benefits is triggered simply where a UC claim is made, not where it is treated as made. It is essential for a smooth transition from legacy benefits to universal credit that the trigger for the move is simple, and that legacy benefit overlap is avoided as far as possible or is otherwise accounted for. The chief goal is prompt and accurate payments of UC to claimants, and, where fraud is alleged, a fraud referral is raised so that the case can be investigated to assess the evidence to establish the facts and determine who was involved, including any third parties. In deciding whether the claim is valid, the consideration needs to factor in whether, or the extent to which, the claimant is involved in the claim.

We at the Department for Work and Pensions are doing all we can to take this matter extremely seriously. We are talking about crime and the money of the poorest being taken away and going to the wrong people. It is important to properly investigate every circumstance; we deal with this on a case-by-case basis.