Agenda item

Counter Fraud Annual Report

Report of the Cabinet Member for Finance and Resources



The Interim Director of Finance presented the report of the Cabinet Member for Finance and Resources on the Counter Fraud Annual Report 2019/20.


The Committee noted that in addition to an in-house resource, the Council also contributed in the Lincolnshire Fraud Partnership, which was hosted by Lincolnshire County Council. The Partnership was developed to ensure collaborative working across Lincolnshire and improve fraud resilience by co-ordinating targeted fraud awareness campaigns; sharing fraud intelligence, best practice and expertise; delivering savings, and making effective use of resources.


The Interim Director of Finance highlighted the requirement for both officers and Members to complete fraud e-learning on an annual basis to ensure that they were aware of their responsibilities in respect of fraud prevention and detection, together with the relevant policies.


Members were advised that the National Fraud Initiative carried out a national data matching exercise every two years (every year for Council Tax Single Person Discount), which was useful to assist local authorities identify potential fraud in such areas as council tax, housing benefit, pensions, payroll, creditors and housing tenancy.


The 3,662 data matches in respect of Council Tax Single Person Discount were released in February 2020; investigation of the matches was delayed because of the Covid-19 pandemic. It was anticipated that this work would restart within the next few weeks.


Work was underway on a business case, which proposed alternative approaches to the current bi-annual Single Person Discount bulk review. The proposed new approach would see a move to a continuous rolling review, which was expected to increase revenue collection. This would help identify more expediently whether a customer had unintentionally forgotten to notify the Council of a change in their circumstances or if fraud was being committed.


Lincolnshire County Council managed the Confidential Reporting Line on behalf of the Fraud Partnership, acting as a single point of contact. In 2019/20 Assurance Lincolnshire referred 41 whistleblowing allegations to South Kesteven District Council; this was an increase from 35 in 2018/19. All of the allegations had been investigated and action taken where appropriate. It was noted that 7 of the referred allegations related to staffing matters. Each of these complaints were investigated under the relevant Council policy or procedure.


Finally, the Interim Director of Finance drew Members’ attention to the action plan for 2020/21, which highlighted workstreams around the Counter Fraud Strategy, fraud awareness including e-learning, the National Fraud Initiative, Lincolnshire Counter Fraud Partnership and Housing Benefit investigations.


Members of the Committee were given the opportunity to discuss the report and ask questions on its content, when the following points were raised:


·         The Council made an annual contribution of £3,000 to the Lincolnshire Fraud Partnership; if Members required more information, representatives from the partnership could be invited to talk to the Committee at a future meeting.

·         The collection rate cited within the report was a snapshot of the position at the end of March 2020. From an audit perspective a collection rate of 67% was considered acceptable. The bad debt provision was budgeted at 10%.

·         Whistleblowing allegations regarding human trafficking could be made through the Assurance Lincolnshire reporting line. Allegations received through the line were referred to the relevant organisation. It was noted that no such allegations had been signposted to South Kesteven District Council.

·         The process for issuing grants to businesses as part of the Covid-19 response embedded robust counter fraud arrangements, including each recipient signing a declaration to say that they would be liable for any misdemeanours.

·         The areas highlighted within the action plan for 2020/21 were thematic and were therefore consistent across reports covering different years.

·         When pursuing debt, the Council followed its Recovery Policy, the stages of which were the sending of an invoice, a reminder and then a final notice. A decision would then be made as to whether further action should be taken by referring the debt to a credit agency or pursuing it through other means.

·         Bad debt arrangements were set out in the Financial Regulations; debts were usually written-off once every other recovery avenue had been exhausted, confirmation received that the individual could not be located, or where the value of the debt was disproportionate to the cost of recovering it.

·         The Council kept records for six years and had provision for debt write-ons, so if an individual resurfaced, the debt could once more be pursued.



Action points:


·         The Interim Director of Finance to circulate additional information regarding the business case developed for an Invest to Save project which highlighted scope to deliver Council Tax recoveries of £10.5m

·         Officers to clarify when fraud e-learning would be rolled out to Members


It was proposed, seconded and on being put to the vote AGREED that:


  • The Governance and Audit Committee approves the contents of the Counter Fraud Annual Report 2019-20, including the action plan for 2020-21


Supporting documents: