WIREDGOV

The Comptroller and Auditor General, Amyas Morse, has qualified the Social Fund White Paper Account for the seventh consecutive year. The account has been qualified because of material levels of error in discretionary awards, which include Budgeting Loans, Crisis Loans and Community Care Grants, and in Funeral Expense Payments. He has also qualified his opinion on Sure Start Maternity Grants, for the first time, because of the level of error found in these payments.

The C&AG has also limited the scope of his opinion on the level of debt within the account, owing to concerns around the adequacy of the evidence to support the debt balance.

The NAO’s best estimate of the total of overpayments in 2009-10 is £106.4 million, approximately 2.6 per cent of total payments (up from £83.5 million in 2008-09, some 2.2 per cent of payments). The true level of overpayments, though, may lie in a range from £82 million to £130 million. The estimated most likely level of error in Sure Start Maternity Expense Payments during 2009-10 totalled £11.7 million, some 8.5 per cent of payments.

The NAO also identifies missing case papers as a significant issue in 2009-10, despite the Department having made improvements in the area in recent years. The problem has been compounded by 229,000 files which were accidentally destroyed by Jobcentre Plus in a paper reduction exercise during the year. Missing or incomplete loan agreements and other missing documentation is another area of concern.

In the absence of sufficient appropriate evidence on the breakdown of the customer debt balance, the scope of the C&AG’s opinion on the debt note within the accounts was limited. Jobcentre Plus acknowledges the severity of these concerns and a Social Fund Task Force has been established to address the problems.

Amyas Morse, head of the National Audit Office, said today:

"The Social Fund provides financial assistance to some of the most vulnerable in society and, of course, judgments associated with making discretionary awards are to some degree subjective. However, the material level of error in these payments has led me to qualify my opinion.

"I have identified a number of new challenges, as well as the existing issues, which the Department must address in the coming year. I will continue to monitor progress made to correct these problems."

Notes for Editors

1. The Social Fund administers five main loan and grant types in addition to Cold Weather and Winter Fuel payments. These loans and grants are split into two parts: discretionary awards (comprising Budgeting Loans, Crisis Loans and Community Care Grants) and regulatory awards (comprising Funeral Expense Payments and Sure Start Maternity Grants).
2. In 2009-10, almost six million applicants for discretionary awards and 440,000 applications for regulated Social Fund awards were processed by Jobcentre Plus, resulting in 4.2 million discretionary awards and 295,000 regulated awards.
3. Press notices and reports are available from the date of publication on the NAO website, which is at www.nao.org.uk. Hard copies can be obtained from The Stationery Office on 0845 702 3474.
4. The Comptroller and Auditor General, Amyas Morse, is the head of the National Audit Office which employs some 900 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.

All enquiries to Sarah Farndale, NAO Press Office: Tel: 020 7798 5339

Mobile: 07985 274 421

Full report - Social Fund Account 2009-10