From the Institute for Fiscal Studies:

The Government thinks it is paying out tax credits or out-of-work benefits to around 200,000 more lone parents than the Office for National Statistics estimate live in the UK, according to an analysis of official statistics by researchers at the IFS.

HM Revenue & Customs and the Department of Work and Pensions together estimate that they are paying income-related support for children to 2.1 million lone parents, even though the best estimate from other evidence is that there are only 1.9 million lone parents living in the UK.

Although there are other possibilities, it is highly likely that fraud or error explain much of this disparity. After analysing
data from the latest Family Resources Survey (FRS), IFS researchers have concluded that a portion of the tax credits or out-of-work benefits which HMRC or DWP think they are paying to lone parents are probably being received by cohabiting couples with children, whether through deliberate fraud or errors made by claimants or the government. If one disregards the threat of fines or penalties, it is often financially worthwhile to pretend to be a lone parent, rather than a couple, when claiming tax credits or out-of-work benefits.
“We already know that the tax credit system is subject to fraud from people using stolen identities. The latest figures provide powerful – albeit circumstantial – evidence that the system is also subject to fraud from families not being honest about their circumstances.

The full press release (released on 12th March) is here.

An insight into the nature of the possible fraud comes from the television programme on benefit fraud commented on here.

Posted by James Bartholomew • Indexed in Parenting • Welfare benefits

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