Social fund loans 'not recorded'

MORE THAN pounds 40m of taxpayers' money was given out in loans but not logged on a Whitehall computer, it emerged yesterday, writes Chris Blackhurst.

MPs on the Commons Public Accounts Committee said they were 'disturbed' that in spite of making 20 changes to the computer system at the Department of Social Security and Benefits Agency and spending an extra pounds 3.9m on consultants, officials were still not supplied with reliable information. In their report, the MPs said they noted the explanation from the department that the computer was not designed as an accounting system but were 'surprised' at the lack of records.

The problems related to the Social Fund, handed out to help people in hardship, to help them pay for a funeral, buy clothes and shoes, equipment for babies, furniture and household items and for heating in cold weather.

A new computer, costing pounds 67.5m, came into operation two months ago. Even though it cost so much, the new system, said the committee, 'will not be fully integrated with the Department's financial accounting system'.

Of pounds 48m paid out in 1992-93 to help with the cost of funerals, only pounds 1.7m had been recovered. Part of the reason was the rising cost of funerals which now average pounds 600 to pounds 700 each.

Nevertheless, noted the MPs, the department should explore ways of getting back the funeral cash.