1 Jobcentre Plus Claimant Representatives Group Forum 24 th August 2011 Progress in tackling Error

2 Jobcentre Plus Estimated Income Support errors Official error overpayments have generally been 1.4% of all IS expenditure since However in 2011 we saw a reduction to 0.9%. We believe that we are realising the benefits of the various improvements undertaken. Our measurement system shows us where we are most vulnerable to making mistakes. In response –we have developed data-matching processes to bridge the gap between different systems. –We have created Action Teams specifically to check claims where the risk of mistake is shown to be high. –We have changed our IT systems to recognise and respond to approaching ending of entitlement such as the end date of a sick note. Official error underpayments have nearly halved since 2006 to just 0.5% (£40m) of all expenditure. Underpayments due to Claimant error have largely remained unchanged - around 0.5% throughout the period.

3 Jobcentre Plus Estimated Jobseekers Allowance errors JSA Official error shows a degree of deterioration since 2006 – now 2.1% (£100m). This is not us necessarily getting payments wrong – but more often due to the measurement methodology. Claimants have received the benefit their circumstances entitled them to, but we failed to provide the paperwork to the auditors, or our staff had not applied the correct procedures e.g. fortnightly intervention work conducted in Jobcentres. Claimant error remains largely steady at 0.5% (£20m). This is because JSA tends to have the most straightforward claims – single non-house- holder males under 25 with less to get wrong. The measurement system shows where we can improve and we have acted to raise accuracy and process compliance levels by: –changing IT systems to provide the evidence to the auditors, – introducing quality checks in 2010 targeting the work of Jobcentre staff, – conducting data scans to identify claims needing corrective action. In underpayment volume accuracy terms – we are 99.8% correct.

4 Jobcentre Plus Estimated Incapacity Benefit errors Official error overpayments rose from 2008 but have since reduced to 1.2% (£70m). The reason for the loss was an increase in the number of cases where we failed to produce paperwork for the audit, and incorrect guidance for our processes. We have since improved paperwork production and changed the guidance to reflect legislation. There is no Claimant Error data prior to 2009 as we only continuously measured official error up to Official error underpayments are low at 0.7% (£40m) but there has been a rising trend. Not all cases will suffer a financial loss as often Income Support is paid instead. We have introduced a Case Cleanse team within the Benefit Integrity Centre to review IB claims and confirm the correct entitlement

5 Jobcentre Plus Conditions of Entitlement £86m – e.g. the Claimant was paid benefit after their Sick Note ran out, or we did not properly comply with an aspect of the process Income & other Benefits £54m – e.g. we got the weekly Occupational Pension or Part Time earnings income wrong or did not correctly take other DWP benefits into account Premiums £21m – e.g. we continued to pay Severe Disability Premium after a change in personal circumstances removed entitlement, or conversely we should have started paying it Labour market errors £9m (JSA only) - e.g. the Jobseekers Agreement did not conform to regulations, we did not retain sufficient evidence to prove the Jobseekers efforts to find work or failed to terminate the award after the Claimant attended a day late to sign on without good cause Applicable amounts £8m – e.g. we paid benefit for partners no longer in the household, Hospital down rating was missed or clerical adjustments were not updated Claimant Error types were Undeclared Capital (£33m), DWP Benefits (£31m), Maintenance (£18m), Income (£12m), and Earnings(£12m) Top 5 Official Error types in IS and JSA

6 Jobcentre Plus Top 5 Official Errors – improvement activities Income Support computers now recognise and react when Medical Evidence is due to expire, providing Claimants with a month’s notice that payments will stop unless they submit further evidence. We introduced a mandatory check for all new claims in March This requires staff to check Departmental systems and identify all other DWP benefits being paid regardless of what the Claimant reports. This will enable us to adjust our final calculations and get the award correct before we make any payments. Implemented our Benefit Integrity Centre initiative in Autumn 2010 to review Claimants’ circumstances at regular intervals to ensure they receive their correct entitlement In May 2010 we cross-checked data between DWP benefit systems, looking most closely at cases to check if their SDP entitlement was still correct. We found errors in nearly half of all the cases we looked at, identifying and correcting £5m in overpayments. We improved our LMS IT system in Jobcentres to address recording issues and also reduce scope for Jobseekers Agreement related errors.

7 Jobcentre Plus Comparing DWP data to identify and correct errors We place equal importance on the prompt correction of underpayments as well as for overpayments. One of our key performance requirements for staff is to clear a minimum 95% of the data checks within 8 weeks of issue. Referral volumes of data checks have reduced over time, falling by nearly half since 2008/09. This is not due to us doing less or availability of the data, but because there is less being found when matched. Error trends show that the volume and value of errors found is dropping too.

8 Jobcentre Plus Data matching performance Based on the findings of our data matching, there are signs of improvement. Despite a rise in the numbers of people claiming benefit over this period, the numbers of errors found and their average value has fallen markedly. The referrals with the highest value of underpayment loss corrected were all associated with DLA and the failure to award the correct Premium. The changes to the benefit system planned for DLA and Income Support will eradicate this problem.

9 Jobcentre Plus Internal Checking of processing standards Jobcentre Plus has for some time conducted various benefit processing checks – on individual processing staff to assure their standards, newly trained staff and the business events we know we are at most risk of getting it wrong. The number of checks rose sharply in 2010 linked to the recruitment of new staff during the recession - and the need to assure that they had absorbed their training. Volumes reduced in 2011 as the post-training checks were not required. Last year, we identified and corrected £230,000 in weekly underpayments, and a further £370,000 in overpayments. The checks found fewer errors than through data-matching but these are still vital activities for preventing mistakes from affecting payments. We can only manually check a small percentage of the work we perform each day.

10 Jobcentre Plus Internal checking – total values Total overpayment and underpayment values were not recorded prior to Similar to data-matching work, the value of underpayments has fallen. Last year we estimate we made good £2.7m in underpayments. Where a claim is found to be incorrectly underpaid, the relevant arrears of benefit are calculated and paid to the Claimant. Official error overpayments are calculated and scheduled for write-off.

11 Jobcentre Plus Benefit Integrity Centre – case cleanse activities The first Benefit Integrity Centre was launched in November 2010 and now operates across 5 sites. It’s aim is to obtain and compare our Claimants’ current circumstances against those already held. For some, it has been some time since they had any contact with a benefit office, or reported a change. Any changes will be immediately applied to the in-week benefit award and past overpayments or underpayments will be actioned. The longer term purpose is to educate Claimants of the need to report any change in personal circumstances as soon as is practicable. Delays can result in recoverable overpayments.

12 Jobcentre Plus What else we have done to reduce error. We introduced a national Error Reduction Team in Summer 2009, brigading our expertise into one place. Their remit was to –Make reducing error a business wide imperative, –Strengthen our Structures –Help make the estimates of loss more precise. We have held national high profile “Error Reduction Weeks” to re-inforce key messages to staff on each of our top five error types every day. It also underlined the role everyone has to play in reducing the number of administrative errors; to make staff think about the loss of tax payers money and the effect administrative errors can have on our Claimants. We held an Error Reduction Conference in experienced staff took part, obtaining information about our top errors and the effect it has on our Claimants. They discussed the causes of administrative errors and generated ideas for practical steps to tackle them. Feedback was overwhelmingly positive and the ideas for tackling error were pursued into the national IT change programme.

13 Jobcentre Plus What else we are planning to reduce error. We are developing a quality process called Knowledge Checkers. These will test the skill levels of our staff and focus on the areas of benefit that cause most administrative errors. The test will be taken annually (like an MOT) and any member of staff who fails to meet the required standard on any part, will be required to undertake focused, in-depth learning and development. The first trial is planned for September 2011 with a view to them being made available to the business in October It places line managers at the heart of the process and provide managers at all levels of the organisation with information for improving the Claimant experience. We are also developing a National Checking Tier to examine a selected benefit claim - from first contact to the point at which payment is made - for administrative error. We aim to check 44,000 cases per year, which will provide a more rounded and complete picture of the claims we’re getting wrong. Critically, it will help us confirm where in the process the error began.