Making public money count, the National Fraud Initiative

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Making public money count, the National Fraud
Initiative
May 2009
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Introduction

• Around 20 billion of public money is spent in
  Wales every year, with public bodies paying out
  large amounts on benefits and social welfare
  claims.
• Public sector bodies are often targeted by
  fraudsters and so need to work together and share
  information in order to minimise the risk of
  fraud.
• The National Fraud Initiative (NFI) was launched
  in 1996 for this purpose and has been used to
  uncover over 11.5 million of fraud and financial
  overpayments in Wales, and nearly 450 million
  across the UK.

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What is the NFI?

• The NFI is a data-matching exercise that helps
  detect fraudulent and erroneous payments from the
  public purse across the UK.
• The NFI runs every two years.
• It helps local government, central government and
  the NHS to identify fraud and error and is
  administered by the Auditor General.
• Authorities are required to submit information in
  respect of their financial systems, for example
  housing benefits claimants, payroll. student
  awards, etc.
• The data supplied is input into a central
  database designed to match data items to identify
  fraudulent or inappropriate activity.

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What are the benefits of the NFI?

• As well as achieving financial savings, NFI helps
  public bodies to
• Strengthen counter-fraud and corruption
  arrangements
• Identify system weaknesses in financial systems
• Gain assurance that system controls are working
  effectively to prevent fraud and corruption and
• Identify health and safety concerns.

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What controls are there?

• The Auditor General administers the NFI in
  accordance with strict data security guidelines,
  the provisions of the Data Protection Act 1998
  and the Auditor Generals Code of Data Matching
  Practice.
• The Code was subject to a public consultation
  exercise and liaison with the Information
  Commissioner and has been approved by the
  Assembly Government.

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Review of NFI 2006/07
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Review of NFI 2006/07

• Successful exercise
• Identified fraudulent and erroneous payments
  totalling 4.7 million
• 26 successful prosecutions
• 213 cases of fraud or error involving public
  sector employees / pensioners
• Continued reduction in long standing frauds, e.g.
  pension payments
• Successful pilot of Council Tax SPD module -
  Cardiff CC - led to 1,758 application for SPD
  being revoked or withdrawn (savings of 2.7mill
  to the public purse) and
• Successful introduction of new matches, taxi
  drivers, market traders, blue badges etc.

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Who participates in the NFI?

• Welsh participants for 2008/09
• Local authorities
• Police authorities
• Fire rescue authorities
• Probation Boards/Trusts
• NHS Trusts
• Local health boards
• Welsh Assembly Government
• National Museum Wales
• Wales Audit Office
• Public sector bodies from across England,
  Scotland and Northern Ireland also participate
  in the NFI.

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What data is matched in the NFI?
Datasets matched in NFI 2008/09
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Purpose of the matches

• The NFI can identify
• individuals claiming housing benefit at several
  different authorities
• pensions being paid in respect in the name of
  deceased pensioners
• identify instances where employees are working
  incompatible shift patterns highlighting health
  and safety concerns
• identify employees who appear to have no
  entitlement to reside or work in the UK
• public sector staff who are claiming housing
  benefit when not entitled to do so and
• staff employed full-time by more than one public
  sector body.

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Where can I obtain further information?

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• For information on the National Fraud Initiative
  please see the Wales Audit Offices NFI web pages
  http//www.wao.gov.uk/whatwedo/1252.asp
• Alternatively please contact the WAOs NFI
  Co-ordinator, Wales Audit Office, 24 Cathedral
  Road, Cardiff, CF11 9LJ (nfi_at_wao.gov.uk).
• Please take a copy of the National Fraud
  Initiative leaflet

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