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Dawn Primarolo: The hon. Gentleman said that stories and allegations of fraud abound. Is he suggesting that the Inland Revenue does not investigate those allegations or that the investigations do not come to fruition in terms of prosecutions?

Mr. Clappison: I remind the right hon. Lady of what I said. I pointed out the number of staff


I hope that she is not suggesting that the record of prosecutions is anything other than feeble. She has also conceded in written parliamentary answers that there have been no prosecutions whatever in cases involving child care. Even if one takes into account the number of investigations and the number of penalties—they run into a few hundreds—the performance is less than spectacular.

Prosecutions and the threat of imprisonment have the greatest deterrent effect, or so the Government would have us believe with their television advertising campaign. The right hon. Lady looks quizzical, but their campaign shows a benefit cheat languishing in a prison cell. When it comes to the facts, the truth is rather different.

Dawn Primarolo rose

Mr. Clappison: I will give way to right hon. Lady, but she may want to comment on the fact that in the first two years of tax credits only seven people have been sent to prison for fraud.

Dawn Primarolo: Is the hon. Gentleman suggesting that allegations should not be investigated and proven before a prosecution on fraud takes place? I am a little confused. The hon. Gentleman talks about allegations and the number of investigating staff. Has it crossed his mind that sometimes allegations are made but not proven?

Mr. Clappison: The right hon. Lady is a little confused about the role of the prosecution in the criminal justice system. It is not the role of the prosecutor to prove the offence—

Dawn Primarolo: The role is to get the evidence.

Mr. Clappison: It is the role of the prosecution to get the evidence—[Interruption.] Of course they carry out an

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investigation. They then make a decision based on whether there is sufficient evidence to prosecute, to which they apply the public interest tests, before taking the case to court. Is the right hon. Lady trying to persuade us that the 26 prosecutions in six months or the 22 prosecutions in the previous two years are representative of the scale of fraud in tax credits? I will give way to her if she is prepared to defend that.

Dawn Primarolo: Is the hon. Gentleman suggesting that the Inland Revenue should take cases to court without evidence to support the allegation that fraud has been committed? Is that the centre of his argument?

Mr. Clappison: No, the centre of my argument is that the Inland Revenue's record of prosecuting fraud under this Government's policies is feeble to have brought such a small number of cases to court. That amount of fraud beggars belief.

The right hon. Lady will be familiar with the estimates by the Department for Work and Pensions on the extent of fraud within the rest of the benefits system. It estimates that total fraud varies from £2 billion to £7 billion. Some 12,000 prosecutions are brought each year, but when the Labour party was in opposition it said that that was inadequate. The right hon. Lady's Government have brought only 26 prosecutions in the past six months and 22 prosecutions in the previous two years. That hardly bears out the gist of the Government's advertising campaign.

Mr. Mark Hendrick (Preston): How many cases were investigated and what percentage were found to be fraudulent?

Mr. Clappison: We have obtained a massive amount of statistics on that which the hon. Gentleman can find in the responses to written parliamentary questions. The fact of the matter is—[Interruption.] The hon. Gentleman will find those if he looks at the written answers for the relevant periods. I do not have the figures in front of me, but I can tell him that the number of prosecutions in relation to the extent of possible fraud is very low. I do not know whether the right hon. Lady is defending that, but however one looks at it, the number is very low.

Dawn Primarolo: I hate to spoil the hon. Gentleman's speech, which he obviously prepared before he read the Government's amendment, but has he noticed that our amendment goes further on fraud than the Lords amendment by making it necessary to provide more information on such matters? If he is arguing against the Government's amendment in favour of the Lords amendment, he should realise that the other place asked for less information to be provided than we will give to the House on penalties, prosecutions and other matters.

Mr. Clappison: If the right hon. Lady will exercise a little patience, I will come to that. In the spirit of being open about information and given her remarks about the extent of fraud, perhaps she will tell us something else so that we can make a judgment on the information requested in the amendments. The extent of take-up can only be judged when we compare the number of people who take up the benefit with the number who are eligible. The right hon. Lady is defending the number of prosecutions, and

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her hon. Friends joined her in that. Perhaps she will be as bold as her words in defence of the Government's policy by telling us one thing: how much fraud is there? So far, the right hon. Lady has refused to tell us. She will remember that she wrote to me in April 2001, telling me that the Inland Revenue was conducting a benchmarking exercise to establish the level of fraud in tax credit claims, and that that would run from September 2000 for 12 months. At the end of that 12 months—we shall see whether the right hon. Lady's openness will be forthcoming again—I asked the question again. That was in December. She told me that the results would be known "early next year".

That was earlier this year, and we had the opportunity to ask the right hon. Lady about these matters when we were considering the Bill in Committee. When I asked her again about the extent of the fraud and the outcome of the benchmarking exercise—[Interruption.] This is of interest to the hon. Member for Preston (Mr. Hendrick), because this is the answer to his question. The right hon. Lady told me:


That was me.

I did not hold my breath when I received that reply from the right hon. Lady. It says something about the Government's mentality that they presume that they are the judge of what information can be given to the Opposition and to other hon. Members. I suspect that I was right not to hold my breath because when I raised the question again after a reasonable interval in April 2002, I was referred back to an earlier answer in February 2002, which told me:


We are talking about a report that Ministers have had since September 2001. We have asked repeatedly for information, and months have elapsed. In response to our questions, we have had one blocking answer after another. We have been referred back to previous answers. The right hon. Lady had much to say earlier when I was asking about numbers of prosecutions, and suggesting that there were not very many. Perhaps she will now be as brave as her words and tell us whether the Government will publish their own report—Ministers have had it in their hands since September 2001, at least—and state how much fraud there is within the working families tax credit mechanism. Will the Government publish the results of their own benchmarking exercise?

We simply want to obtain this information. We will be able to judge both sets of amendments when we know how much fraud there is. We shall then know whether the numbers of prosecutions and convictions are an adequate reflection of the level of fraud. Once again, I am waiting with bated breath. I hope that I will not again have to use the procedure of parliamentary questions, because we know how effective that is when the Government are determined to withhold something. My sad experience is that that has been the case so far in this instance. Will the Government tell us how much fraud there is in the working families tax credit mechanism. I ask for a straightforward answer to a straightforward question.

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5.30 pm

Roger Casale: I wish to speak in support of the Government amendment in lieu and in support of the motion to disagree with the Lords amendment.

There is much common ground between what the Government are proposing and the Lord's amendment. I welcome the Government's decision to publish an annual report. I am sure that there will be a great deal of interest in the report from both sides of the House—given the level of support for the tax credits system—and in the way in which it operates in practice.

We have heard that there is common ground on the issue of tackling fraud. The Government's amendment goes much further than the amendment from another place in terms of a commitment to report on the steps that they are taking to tackle fraud. That is despite the huff and puff that we have heard from the hon. Member for Hertsmere (Mr. Clappison).

There is also common ground on reporting on the take-up of tax credits. Again, the commitment that the Government make to that in their amendment is much stronger than that in the Lord's amendment.


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