Underpayments of benefits excluding the state pension were at the highest recorded levels in 2016/17, the Department for Work and Pensions has revealed.

In the DWP’s Fraud and error in benefit expenditure report by the comptroller and auditor general, the benefits showing the highest estimated rates of fraud and error includes pension credit as well as housing benefit and jobseeker’s allowance.

The report highlighted that total overpayments have increased and underpayments have decreased, as a percentage of expenditure, compared to 2015/16. Overpayments of the state pension, however, have remained the same and underpayments have decreased.

Excluding the state pension, overpayments were found to be at the highest levels since 2009/10 at 4.1 per cent, while underpayments are at highest recorded levels of 1.9 per cent.

National Audit Office comptroller and auditor general Sir Amyas Morse said: “In my opinion the overall value of over and underpayments due to fraud and error in benefits other than State Pension remains material by reference to total expenditure on benefits, and the qualification of my audit opinion reflects that.”

Furthermore, pension credit and universal credit overpayment rates were seen to decrease in 2016/17, with the decrease in pension credit overpayments in line with the efforts of the Department to tackle fraud and error.

The state pension continues to demonstrate a very low level of fraud and error, the report said.

Morse added: “When I reviewed Pension Credit last year, I reported that the Department had developed a more coherent strategic approach, increasing its focus on the main risk areas and developing a broader response to tackling the causes of fraud and error. During 2016-17, the Department has started to use the F&E Framework to analyse gaps in its Pension Credit fraud and error response, against causes of loss. This analysis has identified that there is more work to do in the implementation, measurement and evaluation aspects of the F&E Framework, to better understand whether interventions are delivering the expected outcomes and effectively tackling causes of fraud and error.”

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