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Appendix C:
Joint issues with BA and ES

Introduction

During our inspection, we looked at the impact BA and ES have on Barnet’s HB and CTB administration and counter fraud operation. Interviewing and sampling took place in BA Barnet District (Edgware, Barnet and Hendon offices) which falls within BA Area Directorate 2, and in the ES Edgware District (Barnet, Hendon, Mill Hill and Finchley offices). BA Barnet District estimates that between 75% and 80% of its claimants live within the boundary of Barnet LA. This appendix covers the issues arising from Barnet’s business links with BA and ES.

Getting it right

We conclude that BA and ES are taking positive action to protect the system against fraud from the outset:

Barnet Model

The Barnet Model was piloted at Barnet ES Jobcentre from July 1998 and rolled out across the district from April 1999. The normal postal system for making and assessing claims to JSA has been replaced with one where BA staff interview claimants in the ES Jobcentre when they attend their new jobseeker interview. The JSA claim pack has been amended to include guidance for claimants on the evidence they should bring to the interview. A member of BA staff checks the JSA claim form, asking questions when appropriate to establish that there is sufficient verification to enable the claim to be accurately assessed. At Barnet BA, 91% of new claims are assessed during this initial interview, with only 9% requiring the claimant to send in additional verification before entitlement can be decided.

PPT

PPT seeks to identify and target high-risk claims when they first enter the system, using gateway interventions to do so. It uses regular caseload interventions to monitor these claims while they remain high risk.

Barnet has a PVT, which seeks to ensure that new claims are fully verified before determination. We consider that the work of PPT and PVT is key to securing the system.

DSS national figures show that 65% of all IS and JSA(IB) claimants also receive HB. It follows that there is a risk of duplicate work by BA and Barnet unless they work together to co-ordinate their operations. For example, some claimants could be interviewed twice, while others are not interviewed at all.

Barnet uses the risk criteria in VF to select cases for visiting, but neither BA nor Barnet has communicated its targeting criteria to the other.

Emphasis on new claims and accuracy

We tested how well HB and CTB indicators are set by BA. It is imperative that, in cases where HB or CTB has been claimed, Barnet is notified of any change of circumstances affecting entitlement to HB or CTB, including notifications of the award or cancellation of IS or JSA and changes of address.

From our sample of 78 new and 31 renewal HB claims, we identified 64 cases where the benefit was paid on the basis that either IS or JSA(IB) was in payment. From these 64 claims, we identified 52 where Barnet BA held an IS or JSA(IB) claim and tested whether it had correctly set the HB and CTB indicators.

Of the remaining 12 IS or JSA(IB) cases, 7 were held by a District other than Barnet. No claim to either IS or JSA could be traced in the other 5. The results from the 52 Barnet District claims are shown in Figure C.1.

Fig. C.1 : Analysis of HB and CTB indicators

Outcome

Number of cases

%

Indicators set correctly

44

85

Indicators set incorrectly

6

11

Unable to access the BA claim

2

4

Total cases checked

52

100

Source: BFI sampling

BA is performing well in matching IS and JSA claims with an associated HB or CTB claim. However, the 11% error rate shows there is scope for improvement.

Keeping it right

BA and ES have a vital role to play in keeping Barnet informed of changes of circumstances that affect entitlement to HB and CTB. By February 1999, Barnet District had fully centralised IS processing at Edgware DO. We conclude that effective prioritisation of work by Barnet BA minimises the impact of its arrears on Barnet, but that CBFIS could do more to ensure referral of suspected HB and CTB fraud cases to Barnet for investigation.

The role of Edgware ES in keeping it right is restricted to ensuring that all benefit-related enquiries and changes of circumstances are referred to BA.

The ES role in identifying changes of circumstances in JSA claims

The ES has an important role to play in ensuring that JSA claims remain correct. ES staff keep in regular contact with claimants through fortnightly interventions. They are often the first point of contact for JSA claimants and also receive notifications and enquiries about changes of circumstances. It is estimated that nationally ES staff answer 80% of all JSA enquiries received. Locally, however, BA management would prefer that ES staff referred all benefit-related matters to one of the
co-located BA staff.

Across Edgware District, ES is using experienced staff to deal with labour market enquiries and making extensive use of casual staff to cover interventions. We found that these casual staff do not receive sufficient HB and CTB awareness training to enable them to answer claimants’ enquiries or to fully record details of notified changes of circumstances. ES casual staff are encouraged to refer benefit entitlement issues first to their team leader and then, if necessary, on to BA.

CBFIS referral management

Since April 1999, BA’s counter fraud strategy has moved away from achieving WBS and sign-offs, and towards identifying overpayments and applying penalties and sanctions. LAs, however, still measure their performance in terms of WBS.

We sampled 25 of CBFIS’s NFA and overload referrals, where the alleged offence would affect entitlement to HB or CTB if it were in payment, to establish the extent to which potential HB and CTB frauds are being investigated. The results are shown in Figure C.2.

Fig. C.2: Analysis of NFA and overload referrals
 

Number

%

Cases where HB and CTB found to be in payment at date of referral

9

36

Cases where CTB only found to be in payment at date of referral

5

20

Cases where neither HB or CTB found to be in payment at date of referral

11

44

Total

25

100

Source: BFI analysis

CBFIS took no action in 56% of these cases, despite the risk that HB or CTB was being claimed fraudulently.

We recommend that CBFIS refers its NFA and overload referrals to Barnet and that Barnet reciprocates.

Putting it right

We conclude that, in general, BA, CBFIS and Barnet are working together to ensure that claims are put right when they are found to have gone wrong:

SLA3 procedure

Nominated contacts at Edgware DO deal with SLA3s. These officers adjudicate, re-assess and calculate IS overpayment and notify Barnet of the WBS that can be claimed. Our sampling of 14 SLA3s issued to the contacts by Barnet investigators showed that the process works well overall. We did, however, identify the following opportunities to improve the procedure:

Joint fraud drives

Until April 1999, when there was a fall in the number of Barnet’s counter fraud staffing, CBFIS and Barnet would meet every 6 weeks to discuss counter fraud operations. These discussions covered the SLA between them and were used to plan future fraud drives. This forum is on hold pending an increase in counter fraud resources at Barnet. CBFIS and Barnet should each consider whether it would benefit the other to participate in its own fraud drives.

CBFIS and Barnet have collaborated in drives which targeted bed and breakfast accommodation, multi-agency road stops, car washes, and restaurants. CBFIS has also checked Barnet’s employee lists, though this stemmed from a payroll cleansing exercise generated by the Inland Revenue rather than proactive work.

QB64 and QB65 procedure

CBFIS should issue these forms, with supporting evidence, to notify Barnet of the outcome of an investigation and to request details of any resultant overpayment of HB and CTB. Form QB64 is used in cases where CBFIS intends to prosecute and QB65 in cases where it does not.

It is vital that CBFIS sends supporting evidence of the fraud. Without it, Barnet cannot classify an overpayment as fraudulent.

We sampled 38 CBFIS investigations to establish how well these procedures are followed. We found 12 cases where IS or JSA(IB) entitlement had ceased as a result of the investigation, HB and/or CTB indicators had been set to ‘Y’, and an overpayment of IS or JSA had been claimed.

We found no evidence that forms QB64 or QB65 had been sent, even though the sample included 2 attempted prosecutions and 2 cases where an administrative penalty had been accepted.

We checked the 12 cases to see if HB or CTB was actually in payment during the period that IS or JSA(IB) was disallowed and, if so, whether Barnet knew of the disallowance.

In 3 cases no HB or CTB was in payment at the relevant time. In 9 cases Barnet had remained unaware that HB or CTB had been overpaid. Barnet did not know the outcome of the CBFIS investigation in any of the cases.

CBFIS investigators admitted that they did not send QB65s, believing that Barnet would be notified of the IS/JSA(IB) cancellation period via computer-generated end-of-entitlement notices. They were unaware of the subsidy implications for Barnet.

The investigators explained that they were reluctant to send QB64s in prosecution cases because they did not know whom to contact about overpayment calculations. They had also found it difficult to get anyone at Barnet to make a witness statement to support the HB/CTB overpayment in court.

Making sure things work

BA administration

The SLA between BA and Barnet mirrors the national model, but performance is not monitored.

BA and Barnet hold bi-monthly liaison meetings at which the SLA is discussed. BA confirms that the meetings have been productive since gaining a formal structure, agenda and minutes. BA also holds bi-monthly Customer Service liaison meetings with Barnet, Social Services, CAB and other welfare rights groups. Local and national benefits issues are communicated and discussed in this forum.

ES administration

Despite being invited, ES does not attend liaison meetings with Barnet. Discussion between ES and BA management is restricted to JSA Unit Management Team meetings.

We recommend that ES representatives attend the Customer Service liaison meetings, and hold meetings with BA and Barnet to increase ES staff awareness of issues that affect the administration and payment of benefits.

We also recommend that ES and Barnet draw up an SLA on issues such as training in benefits awareness and fraud awareness.

CBFIS

CBFIS and Barnet do not notify each other on opening or closing an investigation. A weekly schedule of cases was piloted between April and May 1999, but fell into disuse after 5 weeks. Barnet said that it stopped using the schedule because it lacked the time to check the names on it.

CBFIS should use HBF forms to notify Barnet of the start or finish of an investigation, and Barnet should use SLA forms to notify CBFIS.

We sampled 70 Barnet investigations to assess the degree of overlap with CBFIS work. Investigations overlapped in only 2 cases, one where CBFIS had failed to establish fraud, and another where 2 different CBFIS investigators had investigated a claimant within 2 months of a Barnet investigation on that claimant.

Overlap is therefore not significant. However, CBFIS and Barnet should still consider co-ordinating their investigation work in order to:

AD2 has asked its sector staff to co-ordinate their counter fraud operations with those of LAs and to incorporate LA policy into the sector business plan. To date, Barnet sector has not done so. We therefore recommend that the Barnet Fraud Sector Manager meets Barnet as soon as possible and reviews and revises its business plan accordingly.

CBFIS and Barnet investigators worked together in April 1999 to train 150 Barnet staff in fraud awareness. CBFIS also gives this training to BA and ES staff. The training programme is to be extended with the appointment of a sector liaison officer who will:

The FSM intends to appoint an officer into this role from October 1999.

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