Inside the £20billion benefit fraud black hole that’s crippling the UK
FAST-RISING benefits fraud has cost the country a shocking £20.2BILLION over the past three years – creating a “black hole” in the nation’s finances.
Scammers and organised crime groups are cheating the system, taking £7.4billion last year, according to the Department of Work and Pensions.
In the two years before that, £6.3billion and £6.5billion was lost respectively to fraud.
Campaigners are now calling on PM Sir Keir Starmer to crack down, fearing the problem could sky-rocket following a rise of approximately £1.1billion in benefits fraud last year, reflecting a rise in overall benefit expenditure nationally.
Sir Robert Buckland, a former Conservative justice secretary who prosecuted benefits cheats as a barrister, said: “Labour needs to start cracking down or they will be seen as a soft touch.
“The laws are in place to deal with benefits cheats — but if there is not visible enforcement, fraudsters will see this as an open door and the problem will sky-rocket under the Prime Minister’s watch.
“Sadly, Britain was plagued by benefit cheats under the last administration and this is creating a black hole in the nation’s finances that will only get worse.
Systematic plunder
“Benefit fraud victims are hardworking taxpayers and those in genuine need who are losing out.
“This is money that would be better spent on pensioners, prisons and hospitals.”
Crime gangs and individual cheats have figured out there are rich pickings to be had, while millions of pensioners will be left in the cold this winter following the winter fuel payment cuts.
A total of £266.1billion was paid out in benefits last year — a large percentage of it in the form of Universal Credit.
The DWP says it prevented £18billion of fraud last year, but could not stop 2.8 per cent of its total budget being lost to fraudsters — a rise of around £1.1billion.
Out of the £7.4billion robbed from the DWP, £5.66billion was from Universal Credit.
And The Sun on Sunday has found people have been exchanging online tips on how to get benefits cash, with advice even being given out through social media.
One Facebook user, whose name we are not revealing, posted a series of videos giving guidance under the banner: “Get £300 from DWP.”
In another video, a woman — who again we are not naming — winks to viewers as she explains that she told a Universal Credit adviser: “My cooker is broke.”
She added: “You can apply for an advance, that’s what I’ve done.
“Friday night for me is f***ing sorted.”
The fact that gangsters are now involved was starkly illustrated when a group of Bulgarian crooks was jailed in May for running Britain’s biggest benefits scam.
The gang of five, based in Wood Green, North London, created thousands of fake identities to “systematically plunder” the system and steal more than £50million in Universal Credit payments.
Over four years, they used bogus payslips, doctors’ letters and bills to dupe officials into believing they were giving handouts to genuinely needy people.
Shameless couple
But the claims were fake, with the money being sent to individuals living in Bulgaria who “were complicit and also gained financially”.
The fraud was only unearthed because a lone policeman in Sliven, Bulgaria, tipped off British authorities after noticing the city was suddenly awash with expensive cars and cash.
Judge David Aaronberg told Wood Green Crown Court the sums involved in their con were “eye- watering”.
Galina Nikolova, 39, Stoyan Stoyanov, 28, Tsvetka Todorova, 53, Gyunesh Ali, 34, and 27-year-old Patritsia Paneva were jailed for a total of 25 years and five months after admitting stealing.
They were not the only ones cashing in.
Polish national Wojciech Kowalski and his girlfriend Wiktoria Packowska are thought to have made nearly £750,000 in three years by conning welfare officials.
They stole at least £723,232, Canterbury Crown Court heard, but the true figure is thought to be much higher.
This is a truly dire situation we have inherited, but I am determined to put it right.
Liz Kendall
The shameless couple, both 28, created fake bank accounts, identity documents and utility bills to make more than 80 false benefits claims until they were caught in 2021.
They bought luxury goods including designer clothes and a £12,500 Rolex watch.
Jailing the pair for a total of eight years in June, Recorder Daniel Stevenson told them “every person in this country who works hard and pays their taxes” was a victim of their crimes.
At the other end of the scale, lone opportunists are also a huge bleed on the system.
Amateur actress Ethel McGill, 72, was labelled “Britain’s worst benefits cheat” after also swindling £750,000.
She hid her father’s death from officials so she could keep claiming his handouts.
McGill also pretended she had dementia so she could receive disability payments.
She was jailed for five years and eight months in July 2019, but was released from prison after serving less than half her sentence.
Mother-of-three Sara Morris falsely claimed £20,000 in Personal Independence Payments by insisting she lacked balance, needed a stick and struggled to get out of the bath unaided as she suffered from multiple sclerosis.
PIP provides extra welfare money to those who have long-term physical or mental health conditions and struggle to get around and complete basic tasks.
‘Dire situation’
Investigators found Morris took part in a competitive run two days before her initial claim — and completed 73 races between 2019 and 2022, despite genuinely having MS.
In July, Morris, 49, of Stone, Staffs, admitted exaggerating her illness and was jailed for eight months.
Last night, Work and Pensions Secretary Liz Kendall said: “This is a truly dire situation we have inherited, but I am determined to put it right.
“I will not tolerate fraudsters robbing our hard-working taxpayers and families who need help most.
“It’s only right that we clamp down on these criminals stealing from the public purse and I will look at every measure necessary to do just that.”
Social fabric 'fraying'
Elliot Keck, head of campaigns at the Taxpayers’ Alliance, said: “The new Labour Government should be putting this vital issue right on the top of its in-tray.
“Taxpayers will be reeling from the remarkable revelation that officials are now accepting increased fraud as a given.
“This should be a wake-up call to the political class and the public that the social fabric is fraying at an alarming rate, despite the cost to taxpayers and the country looking increasingly unsustainable.”