Figures released yesterday show that the net recovery of 780 benefit inspectors has fallen to pounds 34m from more than pounds 62m in 1989, despite a rise of more than a million in the number of claimants. An initial 45-minute interview for all new benefit claimants was introduced in 1989, while six- monthly 'restart' interviews became standard for all unemployed people a year earlier.
At both, claimants are asked detailed questions about their availability to work and their financial status. The formal reason given for the new procedures was for JobCentre staff to be able to match jobs or training more closely to the unemployed.
But senior Department of Employment officials confirm that a significant by-product of the system has been a dramatic fall in the number of 'casual' fraudulent claims as people were deterred by face-to-face questioning.
Investigations by the department led to more than 86,895 people coming off the unemployed register in 1989 compared with 50,030 this year. 'We are now down to a hard core. They know our procedures and how to handle the questions we ask,' a department spokesman said.
Gillian Shephard, Secretary of State for Employment, promised continued expenditure to identify fraud and checks to make sure that conditions for benefit were being met. 'While the vast majority of benefit claims are genuine, these figures show that there continues to be a large number of people who are working and claiming benefits intended for the unemployed,' she said. The department, now an executive civil service agency, said its target for the coming year was to cut the number of claimants by 58,000.
All benefit staff had been given instructions on 'fraud awareness'. They are encouraged to conduct the 'dirty fingernails test' on claimants who may be involved in unauthorised work and to report their suspicions.
A unit has been set up to handle inquiries into collusive employers who take on staff knowing that they are also claiming benefit. The number of employers prosecuted trebled last year to 49.
One managing director of a magazine distribution company was sentenced to 18 months in prison after inspectors discovered he had used more than 1,000 bogus names, including Count Dracula and Ian Botham, for cash payments to unemployed people.
Benefit fraud is concentrated in urban areas and among young men aged 18-24 in manual occupations. It is said to have penetrated most temporary jobs where workers are paid cash in hand.
Inspectors at Dover uncovered cases of people claiming benefit and working abroad.
Paul Convery, of the Unemployment Unit, said the department had not proved that 50,000 people had left the count because of its investigations.
'One in three people unemployed don't receive any benefit at all. We think too many resources are put into investigations and should be redirected to those who have nothing.'Reuse content