Council fraud costing taxpayers £2bn a year

Mr Pickles launched a new 10-point counter-fraud blueprint, which he said could help local authorities in England protect frontline services at a time of cuts.

Money currently lost to fraud and error equated to around £95 for every household in England, he said.

Mr Pickles cited the National Fraud Authority Annual Fraud Indicator, which estimated that local government could be saving taxpayers £2.1bn a year by cracking down on fraud in housing tenancy; procurement; pay, pensions and recruitment; council tax; grants; and blue badge schemes.

Compiled by NFA experts at Mr Pickles request, the 10-point blueprint includes recommendations to use credit rating agencies to stop tax evasion and benefit fraud and to carry out staff background checks to prevent fraudsters and organised criminals infiltrating key posts.

Councils are also advised to measure their exposure to fraud risk; pursue a more aggressive prevention strategy; pay particular attention to high-risk areas such as procurement and grant awards; and maintain specialist fraud investigative teams.

Mr Pickles said: “It’s time to get tough and take on the fraud cons. At a time when we need to cut the national deficit and government waste, cleaning up fraud could save the taxpayer over £2bn in recovered cash currently being fraudulently stolen or lost to tax cheats.”