Detecting, Prosecuting and Punishing Benefit Fraud: The Social Security Administration (Fraud) Act 1997

Date01 March 1999
DOIhttp://doi.org/10.1111/1468-2230.00204
Published date01 March 1999
Detecting, Prosecuting and Punishing Benefit Fraud: The
Gra
´inne McKeever*
Social security fraud is currently estimated at £7 billion per year out of an annual social
security budget of £90 billion.
1
The social security system is hugely bureaucratic and
administrative, leaving it wide open to abuse. Obviously there are individuals keen to
exploit such vulnerability, but many innocent claimants also fall foul of its rules, quite
inadvertently. In 1997, the Conservative government declared that its anti-fraud
initiatives would save taxpayers £7 billion over the next three years.
2
The main plank
in the Conservatives’ anti-fraud strategy, which has now been implemented by the
designed to make the detection, prosecution and punishment of benefit fraud more
effective.
3
The aim of this note is to examine the legislation previously used in the
battle against benefit fraud, to identify the rationale for legislative change, and to
analyse the problems which arise from this new legislative position.
Social security fraud prior to the 1997 Act
Social security fraud was established as a criminal offence prior to the enactment
of the Social Security Administration (Fraud) (SSAF) Act 1997. Section 112 of the
Social Security Administration Act 1992 provides that claimants can be prosecuted
if they are shown to have made a statement or representation which they know to
be false, or if they have produced or have knowingly caused or allowed to be
produced any documentation or information which they know to be false for the
purpose of obtaining benefit for themselves or another, or for any other purpose
connected with the legislation.4In the absence of a false statement or documenta-
tion, prosecution under the 1992 Act is not possible, but where it is both possible
and successful it can result in a fine, imprisonment or both. Section 34 of the
Jobseekers Act 1995 also makes benefit fraud an offence, although it is obviously
limited to fraudulently obtaining Jobseeker’s Allowance, with the scope of section
34 the same as that of section 112 of the 1992 Act. Most prosecutions for social
security fraud are brought under social security legislation since this is compara-
tively cheaper than prosecuting under the criminal law.5
ßThe Modern Law Review Limited 1999 (MLR 62:2, March). Published by Blackwell Publishers,
108 Cowley Road, Oxford OX4 1JF and 350 Main Street, Malden, MA 02148, USA. 261
* School of Public Policy, Economics and Law, University of Ulster.
Thanks to Brice Dickson, University of Ulster, and Laura Lundy, Queen’s University, Belfast, for their
comments on earlier drafts of this note.
1Beating Fraud is Everyone’s Business: Security the Future Cm 4012 (1998) 12.
2ibid.
3 The majority of the Act’s provisions have been brought into force by the following commencement
orders: No. 1 SI 1997 No 1577, No 2 SI 1997 No 2056, No 3 SI 1997 No 2417, No 4 SI 1997 No 2669
and No 5 SI 1997 No 2776.
4 The 1992 Act is a consolidating measure: s 112 of the Act was originally s 146(3)(c) of the Social
Security Act 1975, which then became s 55 of the Social Security Act 1986.
5 Prosecutions under the Social Security Administration Act 1992 are ‘relatively inexpensive . .. about
£150 a throw’, while those brought under the criminal law cost over £1,000 per case: Social Security
Committee, Third Report: Housing Benefit Fraud, 1995–96, HC 90-I and HC 90-II: volume 2, Q 704.

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