MPs have slammed the Department of Work and Pensions for using "inadequate information technology systems'' which have allowed benefit fraudsters to rip off the taxpayer by around £2bn a year.
The House of Commons Public Accounts Committee had demanded a stepping up of action on the issue, saying the department has "lost momentum in reducing this unacceptable level of fraud''.
In a report on "Tackling Benefit Fraud'', the all-party group says, "The department's inadequate information technology systems are a further constraint in tackling fraud. Benefit data are held in 20 separate systems with no common access point to all the systems. Consequently staff cannot readily detect incorrect information supplied by customers. The systems also rely on clerical interventions in the calculation of benefits.
"Problems previously encountered in delivering new IT systems had persuaded the department not to aim for 'big bang' replacement of their main Income Support and other existing computer systems. Instead, they would be making incremental improvements over the next three years, which they expected to bring benefits in eradicating error.
"They were also approaching IT architecture differently, seeking to strengthen the links between the main Income Support/Jobseeker's Allowance system and other systems."
The PAC said the department will step up cross-checking and data matching of benefits to stop people getting extra money by failing to declare other benefits.
The department hoped that projects under way would provide automatic cross-checking between different benefits. An integrated electronic information gathering system for new and repeat claims for the main working age benefits and associated claims on other benefits was planned for this autumn.
This would signal information on customers already held on departmental systems automatically. A single record for each customer, showing benefit awards and payments, which the department planned to introduce in 2004, would later include household data and help to tackle fraud associated with living together as husband and wife.
The PAC report said:" Information technology improvements were expected to deliver roughly one third of the further fraud reduction required by 2006."