National Fraud Initiative: Data Matching Purposes and Code of Data Matching Practice

Julia Lopez Excerpts

Wednesday 10th February 2021 Written Statements

[The Parliamentary Secretary, Cabinet Office (Julia Lopez)]

The Cabinet Office is looking to consult on widening the national fraud initiative (NFI) data matching powers and updating the NFI code of data matching practice. The powers are embedded within the Local Audit and Accountability Act 2014. The powers are:

to assist in the prevention and detection of crime (other than fraud);

to assist in the apprehension and prosecution of offenders;

to assist in prevention and detection of errors and inaccuracies; and

to assist in the recovery of debt owing to public bodies.

Currently, the NFI can only match the data it collects for the purposes of detecting and preventing fraud¹. These proposals focus on increasing NFI’s operational efficiency and value for the public sector by widening those purposes. Early estimates suggest that by better utilising data already collected by NFI, supplemented by additional data collection where appropriate, enactment of these powers could deliver early efficiency savings (within the first three years) of at least £10 million a year to key public sector organisations. We would expect savings to be far greater over a longer period. Critically, research shows that there are clearly important wider outcomes for citizens overall: that the data matching powers would help

the police solve crimes other than fraud, or find offenders more efficiently than is currently the case;

local authorities and Government Departments to reduce debt owed to public bodies while adhering to the fairness in debt management principles; and

agencies or departments to reduce any errors that might exist in official data records, thereby helping to deliver more effective services or to ensure citizens receive the benefits they are entitled to.

Operating within a strong governance framework since 1996, the NFI already collects over 8,000 datasets, 300 million records of data from over 1,300 participant organisations². To date it has already enabled participants to prevent and detect fraud and overpayments across the UK worth £1.9 billion through data matching. The powers were embedded into the Act in 2014 when the NFI transferred to the Cabinet Office and are not part of the current covid-19 emergency response or legislation. Our work to date shows that the powers will create longer term efficiency savings that will help public services. This aligns with the Cabinet Office role of creating efficiencies across Government and the Government’s manifesto commitment to improve the use of data in the process of government. We are committed to transparency on these proposals. Work to enact the powers was one of the five key objectives set out in the NFI strategic delivery plan 2018-2022. The results of this consultation will be instrumental in determining the way forward. The consultation documents are available on gov.uk and will be open for responses until 10/03/2021.

¹Data matching compares data to identify anomalies that might represent a fraud. The NFI is not permitted to identify patterns and trends in an individual’s characteristics or behaviour which suggest nothing more than the individual’s potential to commit fraud in the future.

²The NFI has both mandatory and voluntary participants. Participants include all local authorities, NHS trusts, police authorities, passenger transport executives (PTEs), fire and rescue services and combined authorities in the UK. Government Departments and private sector organisations can participate on a voluntary basis.

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