Housing Benefit Fraud

I've taken the piss out of NCC's anti-benefit fraud measures before but with new figures available it's time to have another go.

Again, the report before the Audit Committee is the source of our interest here. On page 8 we are told that, during 2012/3, NCC detected 178 Housing/Council Tax benefit fraud, worth a total of £586,490. Even without any help from a responsible adult, I have worked out that is an average of £3295 per case.

The Midlands and East of England average is 332 cases, totaling £698,296, an average of £2103 per case.

I don't think we can make too much of the lower than average number of cases, that average is clearly elevated by one LA (Birmingham?) with 3500 or so cases. But NCC's higher value per case could be said to imply that frauds are not caught as early, which is not a good thing in fraud detection circles. There are probably other potential explanations as well.

But hello, what have we here? (word document) It's a Freedom of Info request asking about how much NCC spends on anti benefit fraud activities. It says that, in 2012/3 NCC spent £586,000 on such work, the money going on

...cost of the fraud staff in wages and then a percentage of all other costs based on fraud staff as a percentage of total benefits staff. Other costs include such things as IT, accommodation, central charges etc.

That's pretty clear, the question was unambiguous and the explanation of the costs makes it plain that the cost of the activity hasn't been confused with, say the amount of fraud detected...

Because the two figures are rather similar aren't they? It seems an extraordinary coincidence that, for a spend of £560,000 anti-fraud activity you detect fraud worth a total of £560,490.

Unless of course you've been a bit lazy and, rather than come up with a system to estimate the worth of each fraud case you catch and collating the results annually, you simply record as the 'cost' of detected fraud as how much how much was spent on the wages, IT and paperclips of your crack fraud detecting team. And in the FoI response linked, they DID say they didn't have an estimate of the value of fraud committed.

If it wasn't for the fact that NCC's housing benefit service has a long track record of pisspoor management information systems (largely due to having pisspoor management) I would find this explanation impossible to believe.

The alternative of course is that NCC's benefits fraud team saves the council the grand total of less than £500/year. Before anybody says that any saving is worthwhile you must remember that many people are investigated for fraud and found to have done nothing wrong. It is always a stressful, sometimes terrifying experience. I sincerely hope it is the 'crap management information' explanation that turns out to be correct because a saving of £490 is not worth a single person being wrongly accused and investigated.

Nottingham, the Hotbed of Blue Badge Fraud?

It's not just wheelie bins that Nottingham's scammers have got their greedy little eyes on, if the numbers are to be believed, Nottingham is by far and away the region's hotbed for Blue Badge fraud.

A report (pdf, page 12) going to the next Audit Committee meeting gives a number of interesting details of fraud against NCC, one of which is that, in 2012/13, 355 Blue Badge fraud cases were detected. The Midlands and East of England average was 18 cases. In other words, NCC is said to have nearly 20 times the average regional Blue Badge fraud rate.

Sounds legit...

We know that assessments for Blue Badges is carried out by an 'independent' private medical company (as mentioned in this 2011 portfolio decision on the related matter of Mobility Citycard examinations) and they may be carrying out their duties with Atos like aplomb. I also suspect a certain statistical sleight of hand, such as assuming that every Blue Badge renewal found to no longer qualify is put in the fraud pile.

I think local media are planning on looking into it so I'll let them do the work and see if any explanation better than NCC seriously shafting its disabled citizens comes forth.

Shameless Cover-Up Continues

The Post is reporting that the Audit Committee yesterday voted to discuss the critical report into the administration of the Future Jobs Fund in private. An early contender for smallest surprise of the year I reckon.

One of the recommendations is apparently that former councillor Hassan Ahmed's conduct be referred to the Standards Committee. The article quotes Cllr Stuart Fox agreeing with monitoring officer Glen O'Connell's opinion that publishing the report could prejudice an investigation by the Committee -

"In the public domain it would prejudice the next step. It would undermine one of the district auditor's recommendations."

I'm sorry but how? The only way it could prejudice proceedings is if those making decisions i.e. councillors in the main, get to see information that could unduly influence them in making their decision. As it is already public knowledge that the District Auditor already believes that Ahmed breached the code of conduct that horse has already bolted. Furthermore, the councillors will have already seen the full report so any further prejudice that could be said to occur has already happened. Letting the public see the report can make no difference because we don't have a say in the matter. It's not like a trial where we could potentially be picked for jury service.

It also seems pretty pointless to bother with a Standards Committee investigation anyway. Ahmed is no longer a councillor and all the committee could do is to make a public finding against him which, hey, the District Auditor has already done. The man's reputation is soiled beyond redemption anyway so what more could they say?

Of course, pursuing a Standards Committee investigation gives them the excuse to kick the full report into the long grass. The investigation into Grocock's case has taken the best part of three years and, whatever else might be said about him, he does at least appear to have done everything he could to co-operate with them. There's not much chance of Ahmed being so compliant and, after all why should he be? He's got absolutely nothing to lose or gain. I doubt we'll hear any more before the next local elections.

It's interesting to note that the District Auditor did actually say that it was her 'preference' that the report be published. Well, grow some fucking ovaries missus, if you'd made it a public interest report they wouldn't have had a choice would they?

In the meantime Freedom of Information Act requests have been issued and no quarter will be given re time limits. I doubt very much that the Information Commissioner will have a lot of time for the weasel excuses NCC has wheeled out, he's no Nottingham City Council fan anyway.

Pointless I know...

I know that such attempts at engaging with our democratically elected members is a hiding to nothing but I have sent the following email to the members of the Audit Committee which is meeting tomorrow to discuss, among other things the District Auditor's 'Jobs Plan Review' report -

"I am writing to you as members of the Audit Committee to ask that you reject the recommendation to discuss the 'Jobs Plan Review' report in private and to agree to the report being made public.

From the Annual Audit Letter it is clear that the District Auditor contains some serious criticisms of the way the Future Jobs Fund was administered and it is overwhelmingly in the public interest for those criticisms to be made public.

The Leader of the Council has already quoted directly fro the report for his own political purposes and for him to be able to do this without the public knowing the full contents of the report really is an insut to the people who voted for you and to democracy itself.

If you choose to vote in favour of the report being kept private I challenge you to reply to me to give your reasons why so that the public can understand your thinking. I would be intending to make such replies public.

Lastly, can I point out that I have requested a copy of the report under the Freedom of Information Act and, even if you do vote for the report to remain private under s.100A of the LGA 1972, this will not necessarily mean that the Information Commissioner would conclude that the report is exempt from release under the FoIA. As such, in time it is likely for the report to be made public eventually."

I am under no real illusions that any of them will take the slightest bit of notice but you have to try.

Addendum - Perhaps not completely hopeless, I did get one helpful reply back.

I won't name the member involved but they did say that they hadn't yet been given detailed reasons why the matter should be discussed in closed session. But the Post has a council spokesperson saying -

"...that "open circulation" of the report might lead to defamation of those identified within it and prejudice the initial stages any standards committee hearing."

So it looks like the PR team are being briefed before councillors who are charged with making the decisions. Not good.

Check that Post article for a brilliantly comedic quote from Hassan Ahmed as well at the end.

Shameless Cover-Up

Well, we finally have the Audit Committee meeting agenda up on the Council's website and they are indeed discussing the Annual Audit Letter which gives brief details of the crooked goings on behind the Future Jobs Fund and which I wrote about before when they mistakenly added it to their website a bit early.

They are also discussing the full report on the matter by the District Auditor but what's this? -

"7

TO CONSIDER EXCLUDING THE PUBLIC FROM THE MEETING DURING CONSIDERATION OF THE REMAINING ITEM IN ACCORDANCE WITH SECTION 100A(4) OF THE LOCAL GOVERNMENT ACT 1972 ON THE BASIS THAT, HAVING REGARD TO ALL THE CIRCUMSTANCES, THE PUBLIC INTEREST IN MAINTAINING THE EXEMPTION OUTWEIGHS THE PUBLIC INTEREST IN DISCLOSING THE INFORMATION

8

JOBS PLAN REVIEW Report of District Auditor, Audit Commission"

Oh look, they're covering it up. I should be surprised. I SHOULD be...

There can be no possible public interest in not releasing to the public a report by the District Auditor, especially when there is clear reference to that report's main conclusions in the Annual Audit Letter which confirm serious criticisms of the Council's conduct.

The fact that JoCo has already selectively quoted from that report for his own political purposes simply adds further insult to the outrage.

I have written to the District Auditor asking that she insist on the matter being discussed in public and for the report to be made public. If she refuses to do this it can only raise questions about her political impartiality and complicity in a cover-up.

Future Jobs Fund - NCC and a Certain Person Criticised Again

NCC has posted its latest 'Annual Audit Letter'* (AAL) from the Audit Commission to its website. A dull and rather fusty document normally but this one contains a chunk of info the NCC will NOT be keen to draw your attention to. So I suppose I'd better.

You'll remember that former councillor Hassan Ahmed decided not to run for office at the last local election and the Post speculated it might have been due to skullduggery with the Future Jobs Fund. Well the the AAL confirms that he was in the firing line. The letter only contains brief details but does say that a full report on the matter was sent to NCC in November but they have so far chosen not to make it public. Funny that.

So, what do we know so far? Let's simply quote in full what the District Auditor says -

• "The Council (acting as accountable body) has failed to comply with the requirements of its own constitution, standing orders and financial regulations in awarding Future Jobs Fund and Community Programme contracts. In particular, specific individuals failed to demonstrate appropriate accountability for the decisions taken. These failures were compounded by poor record keeping within the Council

• My investigation has led me to conclude that the relevant Portfolio Holder’s conduct may have been in breach of paragraph 3(2)(d) of the Code of Conduct (conduct which has compromised or is likely to compromise the impartiality of officers). My concerns arise from the need for transparency and good corporate governance rather than that there was any actual inappropriate allocation of contracts (in relation to which I did not find any evidence).

• The role of partners as set out in the original bids did not fully materialise in practice: As a consequence, some partners felt let down and had concerns around consistency and transparency. In my view the Council could have done more to allay these concerns by being more open and transparent about the need for changes and to ensure everyone was given an equal opportunity to respond to these changes."

The 'relevant Portfolio Holder' was of course our old mucker Hassan Ahmed. Note the finding that he breached the members code of conduct, which is the second time he has been found guilty of this. he has gone now as I say but the other findings, including that NCC breached its constitution, standing orders and financial regulations is as damning as it gets.

It's not clear whether NCC intends to make the full report public. There have been numerous rumours about the matter for some time involving certain usual suspects. If it is going to be made public it is likely to be alongside the AAL at the next Audit Committee meeting due on 6 January 2012. If it doesn't appear there it'll be Freedom of Info Act time again.

* Since posting this document yesterday, NCC removed it from their website, presumably hoping to scupper my article in the process. This is why the link now goes to Google Docs, where I saved a copy.

Audit Committee Fooled Again

I was largely right in my last post about the latest shit tsunami that the Housing Benefits service is embroiled in. Essentially, the Audit Committee fell for it again.

Dear old Lisa Black who, lets remember, has no special difficulty with misleading an employment tribunal on oath and so could probably lie to the Audit Committee in her sleep, seems to have got the excuses in early.

She claimed that a review of the single persons' discounts for Council Tax had been a 'focus for the service' which supposedly 'highlighted 3000 cases' for the Housing Benefits visiting service and raised £900k. Let's have a look at that in more detail.

First of all, while both Council Tax and Benefits are on her patch they are two separate things and will have different teams, although I suspect that the visiting staff will be shared because, for the most part Council Tax doesn't really need visits carried out apart from one-off projects like this. But, once the visiting officer has done the visit and collected the required information, it will be passed to Council Tax staff and not bother the Housing Benefits workstream any more. And I'm sure that a significant number of those visits could be combined with benefits visits that would be happening anyway. So, although it might have been a big chunk of work for Council Tax staff I can't see how it would have affected the benefits side of her empire very much, beyond the visiting staff.

Except it didn't cause a big chunk of extra work for Council Tax staff because the job was outsourced. And the decision to do so contained a justification to use outside consultants along the lines that doing it in-house would be too onerous and costly. But Lisa doesn't bother mentioning all that, she preferred to leave members with the impression that the lack of quality control in Housing Benefits was a mere aberration which was caused by this huge onerous one off project, even though the 'experienced staff' mentioned by Internal Audit who 'despite training' still messed up the overpayments process wouldn't have been involved.

And if you fancy a full house in 'Management Bollockspeak Bingo' get a load of this sentence -

"...the amount of training had increased significantly and targeted training was being identified through continued training needs analysis, quality assurance checks and support requests..."

I mean it's just rhubarb isn't it?

And when one councillor (it's not recorded who) did ask a slightly tricky question about how much subsidy could be reclaimed for overpayments either the minute taker fell asleep or Black sold him a bully, saying that the subsidy was 40%. In fact the situation is a bit more complicated as I described in my last piece on the subject -

Essentially, it seems that if errors in benefit assessments caused by the council itself (as opposed to claimants) are below a certain level (approx £616k) NCC still gets full subsidy on it. If it's between a certain range (£616k - £693k) only 40% of subsidy is paid and above that latter figure they get none. In other words there's a pretty strong incentive to keep council caused errors down, which makes sense.

Other types of error are treated differently (see para 400 onwards), for example, error caused by claimants always attracts a 40% subsidy. Errors which are the fault of the DWP or HMRC are fully reimbursed.

So it depends on the cause of the error and, in the case of overpayments caused by the council itself, on the amount of overpayment identified. This in turn means that there is a subsidy advantage in identifying council caused overpayments as something else once the amount gets too high. Like I say, it was never explicitly stated by Internal Audit that this was deliberately being done, just that the process was 'shortcut'.

Now, a member of the Audit Committee who was doing her/his job properly, and once armed with the facts about varying subsidy levels, might want to be reassured that such a thing definitely was not going on and might ask a question about it. But having been told that the subsidy rate is the same, no matter what, they'd have no cause to probe any further.

Same old...

Another Day, Another Report on Housing Benefit Incompetence

Next week's Audit Committee meeting will have another opportunity to enjoy what is becoming a regular ritual; the presentation of yet another report detailing what a bunch of fuck-ups the housing benefits service is. I say fuck-ups but there is the hint of something more sinister going on, more on that in a bit.

This latest installment consists of NCC's Internal Audit services latest report on the housing benefits service which it seems they now do annually. I wrote about the 2009 edition before. The 2010 version was prepared in February of this year but we only get to see it if it's one of the sample of Internal Audit reports that are put before the Audit Committee. As such it was done at the same time as the report from the Audit Commission that tore HB a new one and resulted in the possibility of them having to pay a £2m subsidy overclaim back to central government. As far as I know that's still under dispute.

So what did this latest report say? Well they picked up on the total lack of quality control that the Audit Commission was so scathing about. This included a lack of checks on claims processed by external firm Mouchel which is just asking for trouble. As a reminder, Mouchel got over £266k of our money in 2008/9 for who knows how much worth of benefit claims processed. I'd want to keep a close eye on that myself.

A very interesting piece of detail concerns the reporting of different types of overpayments. Essentially, it seems that if errors in benefit assessments caused by the council itself (as opposed to claimants) are below a certain level (approx £616k) NCC still gets full subsidy on it. If it's between a certain range (£616k - £693k) only 40% of subsidy is paid and above that latter figure they get none. In other words there's a pretty strong incentive to keep council caused errors down, which makes sense.

Other types of error are treated differently (see para 400 onwards), for example, error caused by claimants always attracts a 40% subsidy. Errors which are the fault of the DWP or HMRC are fully reimbursed.

Now, this wasn't mentioned in the Audit Commission report but it seems that NCC is prone to incorrect classification of overpayments, occurring in 25% of a sample checked by Internal Audit. From the report -

"For 2008-9 we claimed £0.5m LA Error but would receive no subsidy if the figure exceeded £0.7m...

...Failure to follow proper procedures results in incorrect subsidy classification – we understand that, despite training, experienced staff continue to shortcut such a procedure. Our testing of 20 overpayments showed 25% where failure to follow procedure led to overpayment classification errors. Overpayment classification has not been checked since Jun 08."

It's not explicitly stated but by reading between the lines you get the feeling that the results of incorrect classification only go one way i.e. to reduce local authority error and retaining the subsidy. This would not be inconsistent with the Audit Commission's conclusion that a major overpayment of subsidy had occurred.

And the slightly tart statement about 'experienced staff' who 'despite training' tend to 'shortcut' the classification procedures. Which results in lower rates of overpayments caused by local authority error. And more subsidy...

Hmmm. Like I said, it's not explicitly stated.

Anyway, as I've said before, Internal Audit would have to march on the Audit Committee wearing rainbow striped lederhosen carrying a 30ft banner saying 'Housing Benefits Staff Are Wrongly Classifying Overpayments So We Get More Subsidy' before it would even raise an eyebrow. I predict a total lack of concern along with a side order of vague promises including 'action plans*' and 'targeted training' etc next Friday.

*If you ever have the misfortune to work at NCC you will soon notice that they love 'action plans'. Generally speaking, in NCC's usage of the phrase it means close to the exact opposite of what it says resulting in very little action and the absence of anything resembling a plan. At NCC, 'action plans' and 'reports' have become the end in itself, instead of the means to an end.

Can Somebody Give the Audit Committee a Slap?

I'm beginning to think that the Audit Committee will believe anything they're told, especially where housing benefits are concerned.

In March 2009 I wrote about how NCC's internal audit service reported various problems, including claims processing accuracy, to the Audit Committee meeting on 13 February 2009. In response the committee said -

"(i) under ‘post payment checks’, Internal Audit had determined that the reasons for basic errors should be investigated and urgently fed back into targeted training to improve accuracy levels;
 
(ii) under ‘processing of new claims’, Internal Audit had determined that the reasons for poor performance should be investigated and urgently fed back into targeted training to improve accuracy levels;
 
In response to (i) and (ii) above, it was reported that both actions had been completed and all staff were now fully trained" 

So. Everything's ok then. It's all tickety-boo.

Moving onto the 18 December 2009 meeting, which I wrote about in January of this year, the committee had an interim progress report from the Audit Commission which was none too complimentary about Housing Benefits and in fact said that accuracy levels were getting worse -

"We found a higher number of errors in the processing of individual claims than in previous years, although the overall effect on the amount of subsidy due to the Council was small. We will be discussing with officers why the number of errors in our samples has increased."

Surely that would worry you following the internal report before the earlier committee? It doesn't seem so, they were mollified with -

"...that quality control errors in individual benefit claims’ processing, highlighted during the audit, were being addressed through joint working between officers and the Audit Commission;
 
attempted fraudulent benefit claims would be identified by application of the City’s Counter Fraud Strategy and the Government’s National Fraud Strategy."

Again, it's all fiiiiine, nothing to worry about, chill man.

Essentially the committee were taken in hook, line and sinker. I wrote about the bombshell that awaited the committee at its 28 May 2010 meeting last month and we've just got the minutes through. To remind you, the Audit Commission informed them at this meeting that NCC's claim for Housing Benefit subsidy was so strewn with errors that they had been overpaid by around £2m. Using the accepted international scale of fuck-ups I think that one deserves 'almighty' status.

And despite the various reassurances given at previous meetings the commission found that errors had increased further and that no quality control activity had been carried out through 2008/9 and 2009/10. This means that at least a similar level of error is expected next year.

This time the committee would have had enough surely? They're going to put their foot down this time right? Wrong.

"the issues raised in the report, around housing and council tax benefits, were not only a City problem, they occurred at most authorities nationally;
 
the City was expecting a £2 million shortfall (from the expected Department for Work and Pensions grant of £133 million) due to the issues mentioned above;

with regard to items such as taxes, the City was putting action plans in place to address the issues raised in the report."

Calling it a shortfall rather than an overpayment probably makes it sound less contentious. And another vague promise of 'action plans' seems to again satisfy the committee that all will be well.

We're beyond hook line and sinker now, we're talking beer-battered and wrapped in newspaper with a sachet of brown sauce to go. I mean what is wrong with these people, are they goldfish? Can they not remember anything from one meeting to the next?

I really don't know how things are supposed to improve if nobody is held to account and proper measures put in place to fix the problem. Issues of accuracy go back years as NCC sacrificed quality for quantity in an effort to get processing times down.

If the government asks for its £2m back that should hopefully be a wake-up call because that will significantly mess up the accounts. But the Audit Committee need a slap quite frankly because they've had warnings of these problems and they did nothing.

The Bridge Estate

NCC has had a good old telling off by the District Auditor for its administration of the Bridge Estate, a registered charity which was established in antiquity to raise money for repairs to bridges across the Trent.

The accounts were so inadequate that the audit cost NCC (i.e. you and me) an extra £3.5k in fees to pay for work chasing stuff up. A more serious failing was somewhat tartly revealed in the DA's following comment on the 'public benefits statement' which is required by the Charity Commission but was initially left out -

"The public benefits statement subsequently added to the statements is very limited, particularly in view of the charity's transfer of £1.5m to the council."

Hmmm.

The Audit Committee acts as the trustees on behalf of NCC on a day to day basis, or rather they don't as that seems to be another complaint expressed by the DA. Doesn't bode well if the committee charged with ensuring NCC's financial propriety can't even draw up proper accounts or comply with Charity Commission guidelines.

The Employment Tribunal Investigations Unit; You Couldn't make it Up (although it seems someone did)

I know I haven't mentioned it much but last year I was involved in an Employment Tribunal case with Nottingham City Council. Modesty prevents me from mentioning the fact that I won obviously.

So you can imagine my interest being awakened when I saw a mention of an 'Employment Tribunal Investigations Unit' mentioned in the minutes of the Audit Committee meeting of 18 December last year. So I stuck in a Freedom of Information request to find out a bit more about it.

Here's the reply I got.

"I have investigated your request and the answer to your questions is that there is no 'Employment Tribunal Investigations Unit' and the mention of such within the minutes of the meeting you speak of was a clerical error."

I mean, what would your first reaction be? Why would someone randomly ask about a fictitious 'Employment Tribunal Investigation Unit' at a meeting? Why not 'Paperclip Accountability Commission'? Or 'Robot Kitten Recovery Squad'?

Then I had a thought and rushed off to check the minutes of the meeting again and yes, you've guessed it, they've amended them. Now, the mention of 'Employment Tribunal Investigation Unit' has been changed to "the Council's approach to dealing with Employment Tribunals". (see minute 54(2))

Hmmm, something smells a bit like fish. I suppose it's feasible that the minute taker misunderstood what was said and conflated a request to look into the approach to employment tribunals as meaning a full blown 'investigations unit' but it's also just possible that NCC would be embarrassed about having such a thing, as that would imply that NCC is subject to quite a lot of employment tribunals, suggesting that they weren't the most sympathetic of employers, and that would never do.

I can't be bothered asking for review, I'll just wait for the minutes of the meeting where it's being discussed.

What's the betting that that they pull the shutters down and claim a public interest exclusion?

Update 14 Feb; I have received reliable info that the 'Employment Tribunal Investigation Unit' WAS mentioned at the December 09 meeting but that at the next meeting it was announced that there was in fact no such thing. In other words it doesn't seem to be the fault of the minute taker.