State Pension Credit Bill [Lords]

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Mr. Clappison: I am listening carefully to the Minister. His comments are helpful, but I ask him to go a step further and say that his Department will place in the public domain the results of its investigations and analysis, and targets.

11.15 am

Mr. McCartney: Current targets are in the public domain, as I shall discuss in a moment.

Targets must be meaningful and outcome-based. We are the first Government to have such a strategy. The hon. Gentleman asks us to extend to pension credit a strategy that has been in place since 1997. He does not need to ask exactly what the strategy will be. It will be an extension of that strategy, based on design features of pension credit, not on jobseeker's allowance or income support, for obvious reasons. That needs to be done in consultation with the National Audit Office in considering carefully how underlying fraud and error can be most accurately measured. We also need to consider carefully how to devise an effective approach that minimises intrusion into pensioners' lives.

The new clause would be redundant. It would remove an important safeguard in the impartiality of the fraud and error figures.

The hon. Gentleman asks whether information will be in the public domain. It will. In addition, publication will be independent. Impartiality is important. Let us be honest: a political brickbat over the years has been who has the best policy on fraud and who has done most on fraud. Most Opposition parties base their alternative Budgets on filling up the black holes and getting rid of fraud. The hon. Member for Northavon laughs, but that is true of 90 per cent. of his Budget. They add up the fraud and say, ''That's fine. We're about £1.9 billion short of our target, so

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we'll fill that up with fraud. That'll make us feel good.'' It is a classic. Let us be honest—we are in the open here, and we may as well be transparent about each other's views on such matters.

We have to do better than that. A genuine effort is being made to put in place a preventive strategy and, when that strategy fails and someone is involved in fraud, to challenge and stop that fraud on behalf of the citizen and the taxpayer, and to deal with the person who has perpetrated the fraud. Those three pillars are important.

The fourth pillar is public accountability. That is what we are dealing with here—how we can, through important safeguards of impartiality, have transparent ways of finding out whether the Government are achieving what they set out to do in reducing fraud and error. Those four pillars are a significant step forward from where we were pre-1997. I hope that the hon. Gentleman will accept what I suggest as something that will meet his requirements.

Publications from the Office for National Statistics are subject to a strict protocol under which Ministers have no say in either content or timing of release. Now there's a thing to shiver my timbers. I did not realise that. That is going a bit too far. Does Alastair Campbell know that? It is not possible to get any better than that. I would even argue that a fifth pillar has been sneaked in there.

Seriously, however, I am trying to show how the days of yah-boo about fraud and error should be over. We have put in place intelligent business systems in designing our products in order to prevent fraud, seek it out, stamp it out, deal with perpetrators and allow in a transparent and impartial way the public and the House to see how we have dealt with fraud and error. Along with fraud, error is important. We have concentrated on fraud. Fraud is a fraud on the taxpayer and the citizen. Error is a damning indictment of a system because it impacts negatively on the individual who should not have been the subject of error. The processes for dealing with error are transparent, independent and impartial.

We will do everything that we can as we progress through the implementation of the strategy, and I have no problem with working with colleagues in the House to ensure its success. We are absolutely determined to root out fraud and reduce error to the barest minimum although I cannot hold up my hand and promise that, in a million contacts a day, there will not be someone somewhere who is dealt with inappropriately. I will, however, apologise each time that it happens.

Indeed, there is a new system. Whenever a complaint is brought to my attention, as well as writing to the hon. Member concerned, I write a personal letter of apology to the constituent on the hon. Member's behalf because it used to get right up my nose when I received a letter from a Minister saying, ''Please apologise to a constituent on my behalf.'' Why? The Department made the error. The buck stops at my desk, even if I did not know about the error. We have introduced a system of personal apologies from Ministers to constituents who have been the victim of an error.

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It is a question of culture. If I ask staff to change their culture and become ambassadors on behalf of older people while doing their day job on the front line, at the very least I should give leadership. I am prepared to put up my hand as a Minister and apologise. Whenever possible—occasionally we can—we should pay compensation for the error. It is important for Ministers to show leadership.

We are determined to root out fraud and error, but I hope that hon. Members will agree that the vast majority of older people are honest, upstanding citizens. The measures are about protecting those citizens in particular and the taxpayer in general, because taxpayers pay for the system through tax and national insurance contributions. We have taken the hon. Gentleman's amendment seriously. I hope that he will agree that the measures that we are taking and will continue to take more than meet the problem, and that he will withdraw his amendment.

Mr. Clappison: I shall certainly look very carefully at the Minister's considered remarks and the strategy that he outlined. However, I emphasise that we need information to determine whether the strategy is working. We need benchmarks for current levels of fraud that are based on robust evidence before we can determine what impact the strategy is having.

I agree with the generality of the Minister's comments about older people, and about people who commit fraud because of complication. However, I was not quite with him when he said that people could come into fraud through no fault of their own. I know what he was getting at, but, in order for fraud to be committed there must be intent to commit fraud, which is what he later said.

In his earlier remarks, the Minister was possibly referring to people who become involved in fraud even though their applications were not fraudulent. One way or another, they find themselves trapped in fraud. There is a greater risk of that happening when things are complicated, because people are exposed to more temptation. We must always be careful that, when an allegation of fraud is made, it is proven according to strict standards, the intent to defraud is proved and that we all understand what that is.

Mr. Brazier: My hon. Friend makes a powerful point. There are many advantages to adopting a five-year system. However, one of the problems is that, should pensioners discover some time into the assessment that they have got their calculations wrong for three or four years, the prospect of making a potentially huge repayment could be a strong incentive to keep their head down and not own up to something that they would never have deliberately done.

Mr. Clappison: It is my hon. Friend who makes the powerful point, because that is absolutely right. I dare say that there are other ways in which complication can expose people to a high temptation to commit fraud. We know that older people are generally more honest and we often look to the older generation for examples of how to behave honestly and decently.

The Minister's remarks about design are also important, and I urge the Government to bear those

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in mind throughout the design stage to find ways in which to design out fraud. For an example of fraud suddenly coming to light, we need look only at the individual learning accounts in the last Parliament.

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It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

Adjourned till this day at half-past Two o'clock.

The following Members attended the Committee:
Griffiths, Mr. Win (Chairman)
Boswell, Mr.
Brazier, Mr.
Cairns, David
Clappison, Mr.
Cruddas, Jon
Eagle, Maria
Ewing, Annabelle
McCartney, Mr. Ian
Mann, John
Osborne, Sandra
Selous, Andrew
Smith, Angela
Turner, Mr. Neil
Tynan, Mr.
Webb, Mr.

 
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