Match Winner, the latest biennial report from the Audit Commission's National Fraud Initiative (NFI) exposed the fraud and overpayment by matching council records with other data. This is a 22% increase on the levels of fraud revealed in the last report.
Andrew Foster, controller of the Audit Commission, said, "The net is tightening around those who attempt to defraud the public purse. By sharing information, public bodies are helping to shine a spotlight on areas that have gone un-investigated in the past."
The latest report includes, for the first time, data from some NHS payrolls, private sector pension funds and council rent records. This helped to expose the largest individual benefit fraud, at £83,000, which was claimed by an NHS employee.
About 600 organisations took part in the data-matching exercise, including councils, police and fire authorities, pension agencies, the NHS and central government bodies such as the Cabinet Office.
Audit Commission officials predict that the next exercise, which begins in October, will include all NHS payroll data and a greater number of pension funds, both in the private and public sectors. There are also plans to pilot new areas, such as Home Office asylum seeker data, which would help to uncover landlord fraud in housing benefits and accommodation.
Foster said, "The Audit Commission is committed to expanding this useful national exercise, bringing more public and private organisations into the fold."
The public finance watchdog has also been working hard to allay any public sector data protection fears, said Peter Yetzes, associate director of IT at the commission.
"We have been working for a long time with the information commissioner to clear any data protection concerns," he said.
The NFI forms part of the statutory external audit process for councils, police and fire authorities in England and Wales. Audited bodies and other participating organisations supply data for cross-matching between systems to identify cases where fraud may be occurring.
Officials claim that since 1996 more than £110m of fraud and overpayments have been detected, including about £41m in the NFI's 1998 report.