The Department for Work and Pensions' failure to implement management information systems contributed to £2bn worth of benefit error, MPs said in a report published today.
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The Public Accounts Committee was looking at the government's progress on tackling benefit fraud and error.
While benefit fraud fell from £2bn in 2001-02 to £800m in 2006-07, estimated error rose from £1bn in 2001-02 to £1.9bn in 2006-07.
The report said, "The department has been slow to improve its management information systems, hampering its ability to measure the cost effectiveness
of counter-fraud activities."
Despite a 2003 Public Accounts Committee report concluding that management information was "inconsistent and poor", the department took until February 2008 to roll out a new national management information system, Fraims, at a cost of £65m.
The report said the new system is "not sufficiently comprehensive".
"The department needs to assess the effectiveness of this management information system as it is rolled out, and evaluate the future impact on those counter-fraud activities which currently are not served by the system."