The UK Government has launched the Public Sector Fraud Authority – setting it a first-year target of £180 million of identified fraud benefits. The Domestic And Economic Efficiency And Value For Money Committee has challenged the new organisation to work with central government departments to agree longer-term targets by December.
The Public Sector Fraud Authority will be made up of counter fraud and data staff,. It will be supported by a cross sector Advisory Panel that will provide advice and help shape a strategic approach to public sector fraud prevention and reduction, the Cabinet Office said. The Advisory Panel will have a Chair, who will be announced in September.
Minister for Government Efficiency in the Cabinet Office, Jacob Rees-Mogg, said: “Public sector fraud is not an attack on a single person, and so to many the pain feels less sharp than when directed at individuals. But fraud attacks on government are attacks on money earned by much put-upon taxpayers. They are an attack on the emergency services whose funding they deplete, similarly they steal money from infrastructure projects. As criminals develop more sophisticated tools, we too must adapt and modernise.
“So we’re attracting the brightest minds and equipping them with tools to detect, prevent and deter those who seek to steal money intended to fund vital public services.”
The Authority has a target of working with departments and public bodies to detect and prevent £180m of fraud in its first year. This will be delivered in part by supporting BEIS and bank lenders with data analytics and tools to find fraud and recover fraud linked to the Bounce Back Loan scheme.
However fraud loss in central Government departments, and losses from covid support schemes, notably the ‘bounce back loans’ to businesses, run into the billions. As featured in the August print edition of Professional Security, the charity the Fraud Advisory Panel in its annual report, ‘Running on Empty‘, lamented a ‘wasted decade’ of official counter-fraud efforts, as revealed by the response to the pandemic; notably the launch of covid support by the Treasury ion spring 2020 without due diligence for the fraud risk, nor allocation of many or any staff to counter fraud in applications. It led to the resignation of the minister in charge of countering fraud, Lord Agnew, in January, who told the House of Lords that the Government’s counter-fraud was indefensible. Lord Agnew spoke at the Fraud Advisory Panel AGM in July.
The Panel report noted that local government ‘counter-fraud capabilities have been hollowed out over the past decade’ and argued that a ‘cross-sector counter-fraud authority – durable and well-funded enough to develop and mature in its role – is as badly needed at the local level as it is at the national level, as the Panel has consistently argued since the National Fraud Authority was disbanded in 2013’.
What they say
Chief Secretary to the Treasury Simon Clarke said: “The launch of the new body will put a laser-like focus on fraud and renew our efforts to combat people taking advantage of our public services and support. It will reinforce wider investment in government to crack down on fraud and mis-claiming, including £210m for HMRC to further tackle fraud, and £510m for DWP to target welfare fraud in 2021. Tackling fraud will drive efficiency, saving taxpayers’ hard-earned money which is even more important as we know people are struggling with the rising cost of living.”
Ahead of a permanently appointed head, the Authority will be led by Mark Cheeseman OBE, who led the creation of the government’s Counter Fraud Profession. He described the Authority as a landmark in the fight against public sector fraud. He said: “We know that fraudsters are a committed, capable and evolving adversary. To respond to this we must raise our ambition and challenge ourselves to increase our impact on this often unseen and underestimated crime. The PSFA will support public servants across government and public bodies to take that step – to innovate and to modernise our approach to fraud.”
With £25m of new funding, the Authority will test fraud defences in government; agree counter fraud plans for departments and public bodies and review progress; brief Cabinet Ministers including HM Treasury and Cabinet Office on the fraud landscape; support to departments and public bodies about the fraud risks and threats they face, then help to design defences against them and test their effectiveness; and build a National Counter Fraud Data Analytics Service.
Background
While Chancellor, Rishi Sunak announced the Authority as part of the Treasury’s Spring Statement in March. Visit https://www.gov.uk/government/organisations/public-sector-fraud-authority. It’s an executive agency, sponsored by the Cabinet Office and HM Treasury.
