Findings

Introduction

2.1  Barnet is an outer London Borough. It is the second largest by population of the 33 London Boroughs (including the Corporation of London) and paid over £89 million of benefit to 25,000 people in 1998/99. It has a centralised benefit service supported by a number of satellite customer service points.

Background

2.2  Barnet’s HB caseload has decreased every year since 1995/96. Of the 19,460 HB cases in 1997/98, 47% were rent rebate (RR) and 53% rent allowance (RA). Barnet’s caseload exceeds the Outer London and GB average. This is shown in Figure 2.1.

Fig. 2.1: HB caseloads in 1997/98 in Barnet, outer London and GB

Group	HB recipients	In receipt of Income Support (IS)/Income-based Jobseeker’s Allowance (JSA(IB))			Not in receipt of IS/JSA(IB)
		RR %	RA %	Total %	RR %	RA %	Total %
Barnet	19,460	32	39	71	15	14	29
Outer London average	18,580	31	38	69	17	14	31
GB average	11,110	38	27	65	22	13	35

Source: DSS (from LA returns) 1997/98

2.3  The factors affecting Barnet’s benefit delivery can be divided between:

• working relationships with other agencies
• internal working practices governed by political and strategic concerns.

2.4  Barnet told us that it is fully committed to providing effective administration and countering fraud. This commitment is being undermined by the poor performance of BAFIS and ineffective management control.

2.5  Figure 2.2 shows details of Barnet’s HB and CTB spend in the last 3 years.

Fig. 2.2: Benefit expenditure (£ million) 1996/97 to 1998/99

Benefit	1996/97		1997/98		1998/99
	£m	%*	£m	%*	£m	%*
RA	53.7	58.2	51.6	57.4	50.3	56.3
RR	24.3	26.3	23.9	26.6	24.5	27.4
CTB	14.3	15.5	14.4	16.0	14.5	16.3
Total	92.3	100	89.9	100	89.3	100

* % of total spend
Source: LA questionnaire

2.6  There are no reliable estimates for the local level of fraud, but the NHBAR gave the national level as between 1.3% and 2.6% of the caseload, suggesting 325–650 cases in Barnet.

2.7  The average yearly benefit expenditure on each case in Barnet is £3,560, Applying the NHBAR figures would result in a loss of £1.16 million to £2.31 million. The loss could be even greater as the NHBAR also stated that 4% of the caseload had a strong suspicion of fraud and 1.1% of the caseload had a mild suspicion of fraud.

2.8  Barnet claimed WBS of £1,002,920 in 1998/99, against its threshold of £1,342,287. This figure was awaiting audit at the time of our on-site inspection. The external auditors reduced Barnet’s WBS claims in both 1996/97 and 1997/98. 

Fig. 2.3: WBS claimed from 1996/97 to 1998/99

Year	1996/97	1997/98	1998/99
WBS threshold	£1,009,642	£1,161,088	£1,342,287
WBS claimed	£929,733	£1,118,107	£1,002,920*
% claimed of threshold	92	98	74.7
Subsidy (+) or (-)	+£17,250	0	-£3,765

* 1998/99 WBS subsidy claim not yet examined by EA.
Source: DSS (from LA returns)

2.9  WBS performance has declined over the last 2 years. On the estimated WBS for 1998/99, it is likely that Barnet will fail to meet the threshold and will suffer a reduction in subsidy. This is despite Barnet’s efforts to focus on achieving 75% of the threshold, thus avoiding a reduction, rather than on combating fraud and error.

2.10  Our findings and conclusions are set out against the 4 elements of the government’s fraud strategy. We examined Barnet’s performance by assessing:

• what is being done, and whether it is good practice
• any good practices that have not had wider recognition
• the scope for improvement in existing performance.

Our conclusions and recommendations follow the benefit process and identify what Barnet is doing to secure the system from start to finish.

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