Government Fraud Crackdown Saves £480 Million, Fueling Public Services
The government has successfully prevented over £480 million from falling into the hands of fraudsters in the twelve months since April 2024. This significant achievement, driven by new technology and artificial intelligence (AI), marks the largest sum ever reclaimed by government anti-fraud teams in a single year and will allow for increased investment in essential public services like schools, hospitals, and law enforcement as part of the Plan for Change.
Combating COVID-19 Pandemic Fraud
Over a third of the recovered funds, approximately £186 million, is attributed to identifying and recovering fraudulent claims made during the COVID-19 pandemic. Government efforts have focused on blocking companies with outstanding or potentially fraudulent Bounce Back Loans from dissolving before repayment. Millions have also been clawed back from businesses that took out COVID-19 loans they were not entitled to, or multiple loans when eligible for only one. This includes a case where a woman invented a company and sent the loan money to Poland.
Expanding Anti-Fraud Measures
Beyond COVID-19 fraud, the record savings also include clamping down on individuals unlawfully claiming single person's council tax discounts and removing people from social housing waitlists who intended to illegally sublet their discounted homes at taxpayer expense. These actions have helped to return funds to local councils.
The Role of Artificial Intelligence
The government is actively utilizing AI to proactively identify vulnerabilities in new policies and procedures before they can be exploited. This AI fraud prevention tool, developed by the government, scans new policies and procedures for weaknesses, effectively making them fraud-proof during the drafting phase. Early tests indicate that this tool could save thousands of hours and prevent millions in potential losses, slashing the time to identify fraud risks by 80% while preserving human oversight.
International Collaboration and Future Plans
The UK intends to license this AI technology internationally, with Five Eyes partners considering adoption. At an anti-fraud summit in London, Cabinet Office Minister Josh Simons emphasized the importance of protecting taxpayer money and ensuring it is used for essential public services. The savings have been achieved by comparing different information the government holds to stop people falsely claiming benefits and discounts they are not eligible for.
Pension and Housing Fraud Prevention
The crackdown also targeted wrongful pension payments and housing fraud. Over £68 million of wrongful pension payments were prevented across major public sector pension schemes, including the Local Government Pension Scheme, NHS Pension Scheme, Civil Service Pensions, and Armed Forces pension schemes. More than 2,600 people were removed from housing waiting lists they weren't entitled to be on, and over 37,000 fraudulent single-person council tax discount claims were stopped, saving £36 million for local councils.
Ongoing Efforts and Impact
These results follow extensive progress on fraud prevention, including the appointment of a Covid Counter-Fraud Commissioner and the introduction of the Public Authorities Fraud, Error and Recovery Bill. The majority of the £480 million saved is taxpayer money, with a portion from private sector partners, such as insurance and utilities companies, helping lower consumer costs and support UK business growth.
