National Audit Office Press Releases
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Social Fund White Paper Account 2010-11

The Comptroller and Auditor General, Amyas Morse, has qualified the Social Fund White Paper Account for the eighth 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 Cold Weather Payments, for the first time, because of the level of error found in these payments.

The C&AG has for the second consecutive year, also limited the scope of his opinion on the level of debt within the account, owing to the absence of sufficient appropriate evidence to support the breakdown of the customer debt balance.

The NAO estimates that the most likely level of error in discretionary awards, Funeral Expense Payments and Cold Weather Payments in 2010-11 is £98.3 million, approximately 2.4 per cent of total payments. The estimated level of error in Cold Weather Payments during 2010-11 totalled £21.5 million, some 5 per cent of payments (no error was found in 2009-10). The C&AG has, however, removed his qualification of Sure Start Maternity Grants, as the NAO found no errors in 2010-11 payments.

The NAO's work shows that the main causes of 'irregularity' are Jobcentre Plus's inability to provide the documentation needed to support cases selected for audit and a failure to comply with regulations when making awards. Jobcentre Plus believes that the continued high instance of error is due to the ongoing reorganisation of its process centre network, and that the inability to locate all documentation results from the large amounts of paperwork that have been moved between JCP offices during the year.

In an attempt to resolve the issues that the C&AG reported on in 2009-10, Jobcentre Plus set up the Social Fund Task Force. However, while Jobcentre Plus has made progress in a number of areas, the sheer number of records and the complexities of the computer systems involved have meant that work on some areas has not progressed as quickly as Jobcentre Plus had hoped. The Task Force's plans provide a solid foundation on which Jobcentre Plus should build in future to resolve the issues.

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

"Jobcentre Plus has made good progress in a number of areas about which I have expressed concern in the past; but there are still problems and the level of error in these payments is still material. This has led me to qualify my opinion. Jobcentre Plus should continue work to address my concerns and I will continue to monitor progress."

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 regulated awards (comprising Funeral Expense Payments and Sure Start Maternity Grants).
  2. In 2010-11, Jobcentre Plus processed approximately 5.6 million applicants for discretionary awards and 420,000 applications for Funeral Expenses Payments and Sure Start Maternity Grants, resulting in 4 million discretionary awards and 295,000 Funeral Expenses Payments and Sure Start Maternity Grants. There were an additional 17.2 million awards for Cold Weather Payments and 12.7 million awards for Winter Fuel Payments for which no formal applications are made.
  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 880 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.

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