The numbers behind benefit fraud

Benefit fraud is a serious offence and it has been continuously mentioned in speeches and announcements by the Coalition Government.


I certainly do not condone it and the Kirk is completely against fraudulent activities, but, the stress that is being placed on benefit fraud seems slightly out of proportion to the reality. Let us have a look at the data; for the financial year 2009-2010 the National Audit Office estimates fraud to be 0.6% of the Department of Work and Pensions benefits bill, while errors make up more than double this figure. Benefit fraud is estimated at £1 billion, and tax credit fraud is estimated at £0.6 billion, making a total of £1.6 billion.

However the Chancellor seems to have conflated benefit fraud and error during his speech announcing the Comprehensive Spending Review on October 20th 2010. He said:

“Nor will fraud in the welfare system be tolerated any more. We estimate that £5 billion a year is being lost in this way - £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 deploy uncompromising penalties when they are caught.”

How come £1.6 billion got metamorphosed into £5 billion? Has there been a mistake in the decimal point?

There seems to be a tendency to emphasise fraud when poverty and welfare reform are discussed. This often distracts attention from getting resources to those genuinely in need. This is truly unfortunate because our experience working in deprived communities is that life on benefits is often a struggle, with difficult and stressful financial choices being a daily occurrence. We believe this reality is not well reflected in government statements and should be at the heart of any debate on Welfare Reform.

I have therefore written together with a number of other church leaders to David Cameron calling on him to instruct the Chancellor to correct his statement of 20th October and that the publication ‘Tackling fraud and error in the benefit and tax credits systems’ published last week by the Department of Work and Pensions and HM Revenue and Customs is similarly corrected, as it makes the same error.

Biomass power stations

Forth Energy has submitted planning applications to develop biomass powered energy plants in Dundee, Grangemouth, Leith and Rosyth. These power stations would be burning wood fuel to produce electricity. The joint electricity production of the plants is estimated to be up to 500M, which according to Forth Energy amounts to 14% of Scotland’s electricity demands. Forth Energy mentions the advantages of the proposed plants to the selected towns in terms of employment, training opportunities and a contribution to Scotland’s energy mix.

Biomass technology is already in use in a power station at Steven’s Croft, near Lockerbie so the technology seems to be well established. However there might be some questions concerning the sustainability of the scale of some of some of the proposed plants, or the fact that all of proposed plants are to be build in built-up areas. One area of particular concern can be the sourcing of the wood for burning. If most of the wood is going to be imported from abroad, what will be the carbon footprint attached to importing this wood for burning up in Scotland and what will be the impact on the communities where the wood is sourced? All of these are questions to be asked.

The Kirk has no objection to the biomass proposals submitted by Forth Energy since they are on the whole consistent with the views expressed by the General Assembly; however, these proposals have caused concern from a number of local groups including local congregations. Their concerns are listed in the Greener Leith website.

I would encourage everyone with an interest in these issues to get involved in the debate by asking questions, checking the websites listed, lobbying and using your vote.

The Child Benefit Conundrum

Economic recessions have the consequence of pressuring governments into implementing austerity measures that sometimes produce contradictory results. This has clearly been the case for Chancellor George Osborne in the proposed measures to end child benefit after 2013 for families in which at least 1 earner pays 40% tax. The proposed measure has had the unforeseen effect of having some families with joint incomes way above the threshold remaining legally entitled to the benefit, whilst other families with only one salary above the threshold loosing the benefit. The Coalition Government will undoubtedly tinker with the proposed measure to make its effects less contradictory, but what is really at stake is the principle of universality.


Social benefits are intended to alleviate poverty and to soften the sharp edges of capitalism. Making some social benefits universal makes sure that all people get them. It is a simple way of ensuring that all mothers receive financial support without the hassle of forms and means-testing which may be overly complicated and inefficient. In the case of child benefit, this support costs the tax payer £11 billion a year and has been taken up by practically every mother in the UK.

Although some might suggest that the principle of universality is irrelevant in a financial crisis, I think exactly the opposite. Universal benefits send a very clear measure of what is valued within a society. In this case, a universal child benefit states that we are valuing our children, our future. It also states that we value the choice that families might make in deciding whether one family member can afford to stay at home to look after the children. Since it costs close to £200,000 to bring up a child parents must not be penalised by opting to remain at home to raise their children. Finally an attack on the universality of child benefits changes the concept of what we have been entitled to as citizens and residents of this country since WWII. This should not be done just as a cost-cutting measure and without due consultation.

Tax dodging

It was reported last month that £9 in every £100 that should have been paid for in taxes, actually goes missing because people, as well as corporations are very efficient at evading tax. In 2009 this amounted to an estimated £42 million. This is a tricky issue. Should we do everything we can to avoid participating to the costs a society that tries to be fair and provide for its most vulnerable members? Is tax dodging ethically defensible for individuals and corporations?

The question of immoral tax evasion and avoidance lead the Kirk in the General Assembly of May 2010, to study the issue further. I am delighted to see that Christian Aid will be issuing on Monday the 18th a report called “Paying our Dues” which explores the ways by which tax dodging punishes the poor. The Church and Society Council of the Kirk collaborated with Christian Aid in the report and fully supports its vision and philosophy.

As a Christian, I cannot but support the position that it is ethically appropriate to pay our fair dues to the running of the society in which we work, play and make our livelihood.

Leadership, Expertise and Prayers: The Rescued Miners in Chile

I am delighted to see that the miners who have been trapped in the San Esteban mine in the Atacama desert of Chile are being rescued today. It has been an amazing feat of human endurance, to withstand for 69 days in those conditions, and remain optimistic, and help each other survive. Respect and cooperation were the strategies adopted by foreman Luis Urzua, a veteran miner trapped amongst the 33 whose leadership was crucial.. Meagre resources were shared by all. I hesitate to think what their chances of survival would have been if the strongest amongst them would had monopolized resources in a selfish attempt for survival. The miners have taught us all a lesson in the value of respect and cooperation.


Many people have cooperated for this successful rescue. Jeff Hart, a driller from Denver, Colorado was taken away from drilling for water for the US army in Afghanistan to operate the T130drill that would eventually open up a hole large enough for the rescue operation to take place. Drilling for water or oil is not the same as drilling for lives, and Mr Hart, acknowledged the weight of responsibility as he expertly sensed the vibrations of the driller. Jean Romagnoli, a Chilean expert in sports medicine undertook the task of overseeing the men’s physical and psychological fitness. The families of the miners supported their loved ones sending encouraging messages through a video conferencing link. Churches throughout the world and particularly in Latin America organised prayer vigils and services.

Thank God for the combination of good leadership, professionalism, technical expertise, and prayers.

The Azure Card, and survival as a failed asylum seeker

Imagine having to leave your country because of war, or violence, or threats to your life. Imagine arriving to the UK, a country which you think might offer you asylum. Imagine your asylum application refused. Imagine contemplating having to be sent back to whence you came from. Imagine the stress and anguish at having to be handed over to officials of the country you fled from. Imagine that you get ill just before you are sent back or you cannot be sent back because of the political situation in your country. Who are you now? You are now a failed asylum seeker under ‘section 4’.

What does this mean?

It means you will receive £35 a week per person as support towards your maintenance. The snag is that the money is not in cash, but locked in a prepaid “azure card” which is accepted at certain supermarkets and shops. Administratively, this sounds like a good idea, if lots of places take the card, there is choice and convenience.

The cards started its roll-out phase since 2009 in Scotland however, its implementation has not been as simple as it might have been expected. Supermarkets that are participating in the scheme are not always the most cost-effective places to buy food. On £35 a week, cheap food is really important. If you have dietary restrictions because of your faith, the food you can eat might not be stocked in the shops that take the card. The card also has restrictions on what you can buy… it is not accepted for transport, or clothes; in fact… it is not money.

To discuss this, and other issues relating to the problems of asylum seekers in Scotland, representatives from Glasgow Citizens for Sanctuary, have been seeking a meeting with Phil Taylor, the Regional Director for the Scotland and Northern Ireland Region, of the UK Border Agency. Despite earlier attempts, the meeting has not materialized. I only fear that in the current economic climate, the voices of those who live amongst us without the protection that UK citizenship awards will be unheard.

Citizens for Sanctuary search and have developed good working relations with UK Border Agency offices elsewhere, why not in Glasgow? Please, Mr Taylor, can you meet-up with these folk?

Domestic Abuse in Scotland

Over 53,000 reported cases of domestic abuse were reported in Scotland in 2009. More current data is not yet available, but last year’s was already an increase of 8% over 2007. I was therefore happy to see that the Kirk presented a response to the Scottish Parliament on the consultation to Rhoda Grant’s Bill on Domestic Abuse. The Church of Scotland’s Guild has been heavily involved through its Scottish Women’s Convention in working towards improving the position of women in Scotland, and addressing issues of violence against women.


Domestic abuse is not a family spat; it is serious business where women and children have to cope with possible re-location, financial and psychological distress as well as physical violence. This does not mean that all who suffer from domestic abuse are women; there are reported cases of men suffering from this type of abuse, but the numbers are low in comparison.

In the current economic environment, with the extent of the proposed cuts becoming clearer by the day it is important to stress that not everyone will be capable of contributing to the reduction of the deficit. We are not all in this together; some are in such vulnerable positions, that it is not ethical to increase their burden any further. This is the case of victims of domestic abuse. The legal, medical and psychological needs of people in vulnerable positions, escaping their homes because of domestic abuse must be supported.

These people, although traumatized, gather the strength to escape the family home because they are protecting their children. The access to legal assistance is of paramount importance for their welfare and should be protected from cuts, even in these times of restraint.

Welfare Reform should mean Support with Dignity

I truly welcome the fact that the Kirk has been invited to respond to the consultation on 21st Century Welfare issued by the Coalition Government. With a church in every community, the Kirk has been at the centre of community involvement, getting the views of people living in poverty throughout Scotland. Through the work of Scotland’s Poverty Truth Commission, we have had direct access to hear and learn from those that are struggling with poverty. This has informed our views on the need to get the involvement of those struggling with the issues on a daily basis, on any kind of measures directed towards helping them out of poverty. ‘Nothing about Us without Us is for Us.’

The Coalition Government proposes to simplify the benefits system. Aye to that. It also proposes to encourage people to move from the benefits system into paid employment. The welfare system is in place to help those in need. It is a resource that we all contribute into in order to provide help and support to the most vulnerable amongst us. Much has been said about the culture of dependence and the lifestyle choices of welfare recipients. In our experience, nearly all people that are able to work, want to and do so if work is available. There are many ways to contribute into society apart from paid employment. No one can dispute the valuable contribution done by thousands of people caring for children, or tending for a disabled relative; these unpaid contributions, amount to significant savings to the public purse.

Support with dignity is the key.