Benefits cheats costing us £28m

Calls were made last night for tougher sentences for benefits cheats after shocking new figures revealed they are costing the North-East £28m every year.

Calls were made last night for tougher sentences for benefits cheats after shocking new figures revealed they are costing the North-East £28m every year.

The staggering sum - the equivalent of £23 a year for every taxpayer in the region - could be used to pay for an extra 405 doctors or 640 police officers.

The Department for Work and Pensions investigates more than 30,000 cases a year in the North-East and an average of 2,000 fraudsters, who illegally claim job seekers' allowance, income support and other benefits, are prosecuted or cautioned.

However, MPs warned last night more needed to be done to target benefits cheats, whose scams, they say, can disadvantage people with legitimate benefits claims.

They added that the £28m lost to fraudsters every year - more than £500,000 a week - was only the tip of the iceberg, and millions more could be getting into the wrong hands.

Tyne Bridge Labour MP David Clelland said: "This is a genuine problem. It is a burden on the taxpayer and it affects those who are legitimately applying for benefits. It means there is less available in the welfare system for genuine claimers, who are often among the most vulnerable members of society.

"We could afford to pay for hundreds more doctors, nurses, police officers and other public sector staff, if we didn't have this burden.

"Tougher sentences for benefit cheats could be part of the solution, but we also need to be more effective in tracking them down. There is a lot of work to do. The problem is we will never really know how many benefit cheats are out there.

"A lot of fraud is not being detected. This figure of £28m could just be the tip of the iceberg."

Berwick MP Alan Beith said: "Fraud should not be tolerated and the Department for Work and Pensions is right to take action."

Mark Almond, director for the Citizens' Advice Bureaux [plural is corr] in North Tyneside, said benefits cheats were putting pressure on a welfare system, which was already under great strain.

He said: "The benefits system is phenomenally complex and this isn't helping. There is no way of getting rid of it outright. There will always be those who try to beat the system, but we must try and clamp down on as many cheats as possible."

Anti-fraud minister James Plaskitt [corr] said the DWP was taking a tough line on benefit fraudsters.

He said: "Our investigators have more powers than ever before - we can check the bank accounts and household bills of those we suspect of fraud.

"Matching data this way has already helped uncover millions of pounds of taxpayers' money. The public rightly get angry about such anti-social behaviour and with their support we will track down the fraudsters."

A Department for Work and Pensions regional spokesman said there were a number of ongoing operations in the region to clamp down on benefit fraud.

If you suspect anyone of benefit fraud call the National Benefit Fraud Hotline on 0800 854 440.

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Five common scams

1. Not disclosing savings.
2. Claiming benefits while working.
3. Not giving accurate information about who you live with.
4. Claiming to be unable to work while working.
5. Employers failing to declare details of their employees.

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Over 50 implicated in cleaning company scam

More than 50 fraudsters were implicated in the region's biggest ever benefits fraud investigation, which reached its conclusion in Newcastle Crown Court in May this year - but just two received prison sentences.

Operation Hilda, named after the Coronation Street character Hilda Ogden, focused on a cleaning company, which cheated the taxpayer out of £270,000. The company earned more than £1.5m from January 1999 to October 2003 from contracts to clean caravans at holiday centres, including Berwick and Haggerston Castle.

But Newcastle Crown Court heard the firm was using cheap labour, employing cleaners, who were claiming benefits and in some cases bussing them into the sites in Northumberland from Tyneside.

Director Philip Rowland, 50, of Wensleydale, Wallsend, was jailed for two-and-a-half years, after being found guilty of conspiracy to defraud the DWP and fellow director David Wrightson, 58, of Burnhope Road, Barmston, Washington, was jailed for nine months.

However, senior supervisor Barbara Keelan, 45, of Carville Gardens, Wallsend, was given a nine-month sentence suspended for two years.

Judge David Woods said there were exceptional circumstances which enabled him to suspend Keelan's sentence, including the fact she was a single parent of a 14-year-old and she had received no benefits from the fraud, other than her job. A total of 51 other workers at the company, which traded as National Cleaning Systems, were also prosecuted. Their penalties included suspended prison sentences, community punishment and rehabilitation orders, and a curfew order.

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Money lost to the social good

The money, which benefit frauds steal from taxpayers in the North-East every year, could be used to pay for hundreds of extra public sector workers, as well as schools and hospitals.

If benefit fraud were eradicated there would be an extra £28m in the public purse, enough to pay for an extra 405 doctors, 640 police officers, 903 nurses or 1,472, newly qualified teachers.

The staggering sum could also be used to build one-and-a-half secondary schools or a small hospital such as Hexham's. The money would also go some way to dualling the A1 north of Newcastle.

It would cost around £225m to dual the 50-mile stretch of the road between Morpeth, Northumberland, and the border, but £28m would pay for more than six miles of it.

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