Appendix S1:
Investigation caseload and prioritisation

Background

Effective investigations require:

• practitioners who have the necessary range of skills
• an operational framework in which the full range of investigations is undertaken.

We have already commented that Thanet has an experienced and knowledgeable investigation team and we have also looked at the types of investigation they undertake. It is important that one type of investigation is not undertaken at the expense of others, as this may dilute the overall effect of counter-fraud activity.

The types of investigation undertaken are to some extent dependent on prevailing local circumstances. Most of Thanet’s investigation caseload and WBS claims are made up of RA and FV cases:

• RA cases account for about 78% of Thanet’s total HB caseload
• 100% of RA claims are subject to an FV to confirm residency within the first 4 to 6 weeks of the claim
• in 1997/98 90% of Thanet’s WBS claim was achieved from RA cases (this compares to a national average of 71%)
• in 1997/98 59% of Thanet’s WBS claims was achieved from FV cases
• in the same period 3% of Thanet’s WBS claims was achieved from RR cases (this compares with a national average of 11%).

Financial considerations (primarily cost of investigation versus likely return) are important when deciding where to focus investigative effort. This may have led to a concentration on high volume cases which achieved WBS. There are, however, other aspects to consider. Prosecutions, recovery of overpayments and administrative penalties should also be used as they have a significant deterrent effect. They can also provide a source of revenue in cases where benefit has stopped and a WBS cannot be claimed. This consideration is becoming more important with recent changes to the Subsidy Order (see Section 4, Investigation).

Findings

We looked at Thanet’s investigation caseload to see how fraud effort is targeted. Thanet can produce a definitive breakdown of caseholding by type of fraud or type of referral, but does not produce a report on results. This means that in-depth analysis of the effectiveness of the investigations could be difficult. The following table gives a high-level picture of the caseload over the last 2 years and a comparison of annual ‘success ratios’. The success ratio represents the proportion of cases where a WBS has been identified.

Source: Thanet District Council

The key features of the above table are:

• the total caseload increased by 59% between 1996/97 and 1997/98
• the proportion of FV cases only increased by 16% between 1996/97 and 1997/98
• the number of successful FV cases rose from 383 to 795
• the proportional success ratio for FV cases fell slightly, from 16.5% to 15.2%
• the number of non-FV investigations increased by 22.2%
• the number of successful non-FV cases increased by 22.6%.

The increase in productivity between the 2 years is attributed to an office move, improved liaison with the assessment teams, greater management control, increased accountability and changes to the working practices. We commend Thanet for the increased productivity, but as the success ratio has gone down, albeit by only 0.1%, we consider that Thanet should monitor all cases to establish ways of improving the success ratio.

We support Thanet’s use of a high-volume, high-profile FV programme for its deterrent effect, but the sheer volume of these visits may be undermining performance in other areas of fraud. We recommend that Thanet reviews the way in which it decides the types and numbers of cases to be undertaken to ensure that it uses its investigation resource in the most effective way.

All FVs are made within the first 6 weeks or so of a claim. Medium and high-risk cases receive a further visit to deter claimants from waiting until after the visit to commit non-residency or false residency frauds.

Thanet should review the way it prioritises and undertakes investigations. We note and agree with the DA report Countering Housing Benefit Fraud of June 1998 which said ‘Focus and innovation in the investigation unit might be enhanced by the regular consideration of objectives, tasks and targets.’ We consider that Thanet’s investigations would be more effective if it:

• performs a documented analysis of previous cases aimed at identifying high, medium and low-risk claims (by type of claimant, accommodation and benefit or by a combination of the 3) and sets locally agreed criteria and targets by which to judge the success of the visiting programme. Such criteria will differ, depending on the risk profile and objective of the visit. The DSS’s VF may be a useful source of reference
• visits only a sample of low-risk claims (for example, pensioners who live at addresses where the landlord has a reputation for notifying departures)
• visits high-risk claims as a priority
• revisits a large sample of high-risk claims without notification at random frequencies (for example either 4, 6, 8 or 12 weeks after the FV)
• visits a sample of medium-risk claims at random frequencies
• monitors performance against the anticipated target success ratios and amends numbers, types and frequencies of visits to ensure that the programme remains cost effective.

After the inspection visit Thanet told us that they have now amended the fraud investigation unit's business plan. There is now one officer responsible for carrying out operations on targeted areas. All the targeted areas will be reviewed on a regular basis, however, Thanet said that a lack of resources inhibits regular reviews of the business plan.

We believe that such an approach will:

• maintain the deterrent effect of the NCV programme

• allow more time to be devoted to other types of investigation in the absence of a benefits inspector (job title of visiting officers), which will:

• increase the numbers of overpayments identified (and recoverable)
• increase the number of prosecution and administrative penalty cases identified
• improve the effectiveness of the total investigation effort.

Thanet should document similar analysis of other types of investigation to ensure that resources (including any extra resources freed by a revised NCV programme) are directed at investigations most likely to result in benefits to the overall counter-fraud effort and improvement of the success ratio.