An Epidemic of Benefit Fraud? The Demonization of Welfare Recipients

January 9, 2011
By

If you’ve ever opened a tabloid newspaper, chances are you’ll have seen headlines such as this staring back at you, exploding with venomous condemnation:

  • Benefit scrounging couple who claimed to live apart busted by tyre tracks in the Snow. For 16 years the couple duped the taxpayer until suspicious fraud investigators decided to stake out Diane’s Nottingham home. (TheSun.co.uk)
  • Benefits cheat who swindled £11k in ten months offers to pay it back – over 21 YEARS. Crooked Angela Reid, 37, stole the money by fraudulently claiming thousands in handouts. She offered to give back what she had stolen by paying just £10 a week. (TheSun.co.uk)
  • A TRAFFIC warden gave tickets to hundreds of motorists while pocketing £7,000 disability benefit. Peter Hollifield, 57, raked it in after claiming it took him two minutes to stagger just ten yards with a walking stick. But a court yesterday heard how he covered FOUR MILES a day as he issued fines. (TheSun.co.uk)

You might get the impression from reading articles such as these with your Cornflakes each morning that there must be some hidden epidemic of fraudulent benefit claims taking place. A nationwide conspiracy to drain the pockets of middle-England. In reality, this relentless scaremongering has little basis in fact, and those featured in the tabloid press are indeed the highly-publicised exceptions to the rule. Surprising as it may be, just 1% of benefit fraud is fraudulently claimed:

“But 1%? Surely that can’t be right. I mean, googling up the words ‘benefit fraud’ will instantly obtain a crop of headlines like:  ‘Benefit cheat netted £60,000’, ‘Disability benefit cheat filmed jazz dancing’, ‘Scarborough benefit c heat ordered to repay over £18,000’ and, best of all, ‘Glamour model exposed as benefits cheat after claiming £10,000 while working as a pole dancer’. To read those stories, you would come away with the impression that the entire doleite population of the UK is made up of clandestine salsa merchants and Tiger Woods wannabes.”

Liberal Conspiracy – 1%, The real extent of benefit fraud

The false perception of widespread welfare fraud is given additional credence by it’s other, more high-profile advocates. Not the sleazy tabloids previously discussed, but our own politicians. George Osbourne’s spending review speech, delivered on the 20th October 2010, contained the following section, in which he quoted a figure of £5bn being lost annually to welfare fraud:

“Nor will fraud in the welfare system be tolerated anymore. We estimate that £5 billion is being lost this way each year. £5 billion that others have to work long hours to pay in their taxes. This week we published our plans to step up the fight to catch benefit cheats, and to deploy uncompromising penalties when they are.”

George Osborne: Spending Review Statement  (20/10/2010)

This begs the question: where on earth did Gideon get his figures from? Peter Obourne of the Daily Mail and fact-checking website Full Fact both called Osborne out on his inaccurate statement to the Commons and showed the £5.2bn figure consisted not solely of deliberate fraud but additionally, official and customer error. In reality, the total amount lost to benefit fraud comes to £1bn, as shown below:

Levels of Benefit Fraud

Inaccuracies and corrections aside, you could argue that the damage to the public consciousness has already been done once these statements make the press. This kind of demonization has become part of a wider campaign by the right-wing to discredit those drawing state benefits, painting them as ‘scroungers’, undeserving of our empathy and more importantly, our tax revenue.

Whilst I’m not for one moment suggesting that perpetrators of crimes against the public purse should be allowed to get away with defrauding the system, pursuing benefit cheats represents the lowest of the low-hanging fruit when it comes to saving money, and I’d argue that there are far bigger fish to fry, a fact which many seem to be overlook, but one which I now wish to turn your attention to.

Breakdown of Fraud Losses, Attorney General

Breakdown of Fraud Losses, Attorney General - 2010

The Attorney General’s Annual Fraud Indicator report of January 2010 (the breakdown from page 7 is shown above) states that £30bn of fraudulent activity takes place each year in the UK, with benefit fraud accounting for just £1.1bn. Meanwhile tax fraud, which receives negligible coverage in the mainstream press, accounts for £15.2bn, just over half of the UK’s total fraud bill.

“All fraud is wrong and should be tackled, but benefit fraud accounts for less than 1 per cent of benefit spending and is dwarfed by the amount lost to tax evasion. If the government is serious about raising revenue it should put more resources into tackling tax evasion rather than using benefit fraud as a cover for swingeing cuts to genuine claimants.

TUC Spokesman – Referenced on TaxResearch.org.uk

Looking again at these large amounts lost to tax related fraud and bearing in mind the £850bn banking bail out following the financial crisis of 2008, you can see why attempting to suggest that jobs can be saved and that the deficit can be substantially reduced by stepping up a crackdown on benefit claimants is pure fallacy. There’s also some excellent research from the Citizens Advice Bureau, demonstrating that as much as £16bn in benefits goes unclaimed by those legally entitled to it.

It’s a depressing fact that ever since William Beveridge paved the way for the modern welfare state with his 1942 report: ‘Social Insurance and Allied Services‘ (more commonly known as the Beveridge Report) the entire concept of distributing benefits to citizens in need has been under assault from those who campaign instead to further cut taxes for the wealthy, those who believe the invisible hand of the market can regulate the government functions, and those who in my opinion stand opposed to the elimination of Beveridge’s five evils of society: squalor, ignorance, want, idleness and disease. For the vast majority, claiming benefits is a last resort and in many cases it makes ‘the difference between poverty and absolute destitution’. It’s therefore vital that the welfare state is protected from attack by powerful corporate and political interests, before it becomes too late.

[Thanks to The Guardian for featuring this article in their Society Daily briefing for 12/01/2011.]

13 Responses to An Epidemic of Benefit Fraud? The Demonization of Welfare Recipients

  1. Jessie on January 14, 2011 at 1:58 pm

    This is a deliberate policy by Murdoch and others to distract their largely working class readership from the real source of the problem. Divide and rule is ever the tactic of the ruling class

    • Michael Roc Thomas on June 7, 2011 at 9:09 am

      Divide & Rule! The ruling class! What a load of left wing rubbish. Nu labour had 13 years (ruling class eh)and as with every other labour period of (hang on isn’t it called) rule, they bankrupted the country again. But accept the blame, you must be kidding. Labour lost the plot just as seriously as that ghastly woman who ran Hackney social services and can’t see that she holds any responsibility about the death of poor baby P. Well we’re now all poor baby P’s economically. Thanks Tony, thanks Gordon, thanks Eds Balls & Milipede.

  2. Alan Barrett on January 14, 2011 at 6:23 pm

    First of all, it’s demoniSation – we’re NOT americans! The very fact that you haven’t bothered using a UK spell checker loses a little credibility for an otherwise intelligent and thought provoking article.

    You may think I’m being pedantic, but it’s the thin end of the wedge when we don’t use our own language properly, allowing it to be hijacked by a nation who thinks George W. Bush was fit to be president!

    Anyway, to the crux of the matter, as Jessie states above, Murdoch’s minions are doing the tory party’s dirty work for them. The deliberate misleading of the public conscience should surely be a criminal offence, it’s certainly immoral, and something else we’ve had foisted upon us from across the Atlantic.

    The unemployed, whose numbers will certainly grow rapidly during 2011, are an easy target, when the real spongers, sucking the lifeblood from the economy, are the tax DODGERS, who happen to be the very rich and more often than not, somehow linked to the tories.

  3. Kate on January 14, 2011 at 6:50 pm

    Actually, Alan, it is inaccurate to state that words ending ‘ize’ are American. Both endings ‘ise’ and ‘ize’ have far older roots, one coming from the French and the others to have its roots in Greek

    Excellent article by the way

  4. Links of Interest (weekly) : Cosmos on January 23, 2011 at 4:45 am

    [...] An Epidemic of Benefit Fraud? The Demonization of Welfare Recipients [...]

  5. kyron on January 30, 2011 at 7:55 pm

    I completely agree this seems to be a underhand tactic by this government and the previous government to demonise the unemployed as well as the sick and disabled. The angle they are trying to work everyone on benefits is cheating scum. The people who are sick and disabled are lying toe rags. This is simply not so ?

  6. robert on February 20, 2011 at 12:07 pm

    THE deaths of two people who were waiting for appeals to be heard against the loss of benefits has prompted calls for a fairer assessment system.

    The two claimants, both from West Dunbartonshire, died from the conditions which caused them to claim Incapacity Benefit (IB) while waiting for appeals to be heard against cuts to their benefits.

    One was deemed fit for work during a work capability assessment, despite having a deteriorating chronic illness, and lost both incapacity benefit and disability living allowance.

    When his support worker appeared at the appeal tribunal she had to report her client could not be there because he was dead. The appeal was upheld and the backpayment will become part of his estate.

    The other had a congenital condition which caused difficulty in walking but was assessed capable of work and his incapacity benefit was withdrawn. He was waiting for a date for an appeal tribunal when he died.

    The assessment was inadequate and very unprofessional. The doctor simply did not have the information
    A third person, again from West Dunbartonshire, died recently after winning a second appeal tribunal following three years of repeated assessments and decisions being overturned.

    He worked as a shop assistant in his 20s but was forced to give up due to severe heart and lung problems caused by a degenerative syndrome.

    An “indefinite” award of IB and Disability Living Allowance (DLA) was revoked after only two months on the basis of a questionnaire he had filled in.

    Six months later it was reinstated by an appeal tribunal. Despite this ruling and the finding that his condition was worse than the original assessment, his case was once again referred for medical assessment.

    Once again, the benefit was withdrawn. He appealed again, with help from staff at the Clydebank Independent Resource Centre, and a tribunal date set for a further six months on.

    By that time he had been confined to bed with severe pain for several days and his extreme difficulty in reaching the chair in the tribunal room caused the chair of the panel to say the hearing would be as short as possible and that a taxi would be waiting to take him home.

    He won the appeal but only after three years of unrelenting anxiety over whether his benefits would be cut.

    See thats the way to save money

  7. Jo on April 1, 2011 at 8:08 am

    Excellent article, thanks very much. I’ve fallen foul of the push to weed out benefit fraud having been found ‘fit for work’ despite plenty of documented evidence to the contrary. Targetting the unwell and the vulnerable is taking the easy path. Why aren’t we all making much more fuss about the amount of tax fraud that goes on?

  8. pamela on April 4, 2011 at 7:19 pm

    Great article as this is something I have felt strongly about for quite some time especially since the Tories came to power. All they ever go on about is this disease which is benefit fraud and yes I agree it does go on but not to the extent to which the claim. Tax evasion has risen to £15.2 billion a year but only £633,000 has been spent tackling it in the last 3 years but £17.5 million has been spent tackling benefit fraud in the same amount of time, its a disgrace the way people who are sick and cant work are treated it is much more easier for them to target the poor as they don’t have a voice. The sun is the worst newspaper for this, they make out people on benefits are living the high life, money all over the place and enjoying every minute of it and I know nothing could be further from the truth, there are those who are pushed to suicide because they are unable to work and cannot live on the money they get, also there is so many people who do want to work but cant find a job because 5 million jobs have been taken up by immigrants. Being on benefits is humiliating enough without sleazy newspapers and rich politicians making it even worse. David Cameron and Nick Clegg have never known a day of hardship their entire lives they come from wealthy families so its no wonder that they are ignoring the rich who evade paying tax and instead focus on the poor, sick and disables and make the welfare system into some parasitic disease that’s destroying the country…it really makes me sad.

  9. A4e Protest on May 5, 2011 at 5:55 pm

    If your looking for benefit scroungers look no further than A4e, owned by Emma Harrison who lives in £5m mansion. Or how about Reed In Partnership and Ingeus. They have made millions from lucrative government contracts to run New Deal programmes to get the the unemployed into work. Trouble is, they failed miserably, time and time again, with less than 20% of the unemployed going into short-term jobs. And these very same companies have been awarded contracts to run the latest failure i.e. the Work Programme. Deloitte, one of the world’s largets accountancy firms bought a 50% share of Ingeus, why do you think they did that.

  10. 28 Weeks Later… : JonathanDavis.me.uk on June 29, 2011 at 1:00 pm

    [...] An Epidemic of Benefit Fraud? The Demonization of Welfare Recipients – This post talked about the levels of benefit fraud in the UK, and contrasted it with media coverage of ‘scroungers’. [...]

  11. Henry Jones on December 25, 2011 at 12:59 am

    Oxford English Dictionary:
    demonization
    (ˌdiːmənaɪˈzeɪʃən)
    The action of turning into, or representing as, a demon.

    Collins:
    demonize or demonise ['di:mE,naIz] verb (tr)
    1 to make into or like a demon
    2 to subject to demonic influence
    3 to mark out or describe as evil or culpable

  12. Dan on February 29, 2012 at 12:26 pm

    I find it odd how you condemn free market economics, when public sector fraud makes up the majority of all fraud. Not to exonerate the private sector, but I would guess that the majority of fraud is conducted to get around excessive government regulation. In fact I would go as far to say that the reason so much fraud exists is because of Keynesian economic policies such as these. If we were to reform all of these things, then it would lead to a fairer system, but that would mean abandoning the leftist economic policies such as excessive government intervention and regulation, and the bailing out of failing businesses and banks so that they can make the same palpable failures all over again, costing us even more money.

    If we lower taxes to 10% for lower to middle earners, and 25% for higher earnings, and reduce corporation tax, then that would mean people and companies would keep more of their own money. The corollary to that is that we would have to limit the size of government considerably. It also makes little sense to put a government that is so inextricably, inexorably, and inherently corrupt and incompetent in charge of our economics. Not to say everything should be totally unrestricted and unregulated, and I am most certainly not saying welfare and benefits should end.

    We need to reform welfare so that it is more efficient, so the £4.2 billion lost through error is reduced significantly) and to come down hard on the scroungers who not only deprive rightful claimants of money, but also contribute to the negative image of those on benefits. We need to significantly limit the size of government. Not just for the sake of economics, but for the sake of our civil liberties which are excessively regulated by a dour-faced, preening, supercilious, authoritarian twits. You may not have noticed, but we no longer possess the freedom of speech and expression. Say something someone else doesn’t like? They can claim it is offensive and have you prosecuted. However, back to the economic issues, limiting government to key areas and drastically reducing government involving in market forces would free up a ton of tax money.

    Other moves that would definitely improve British economy would be to leave the EU. Our only stake is to have a say in trade rules and regulations, yet market forces only need minimal government regulation. Sure, the EU could be petty and raise import/export prices, but we have plenty of trading partners we could strike deals with instead. The major advantage is that we no longer have to bail the EU for their economic failures. We could also let Scotland become independent. If handled well, giving the Scots independence would leave them to manage their own nation separately, thus we would have more resources to regulate the rest of the UK. Feasibly, we could give the rest of the UK independence too, but I’m not so sure about that right now. Downsides include the possibility of having access to the North Sea gas denied, however.

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