The Home Office does not know what fraud is costing the UK economy or what is being spent to tackle it, the independent public spending watchdog has found.
In a critical report, the National Audit Office on Tuesday said the department, which leads the government’s response to fraud, had no clear sense of the cost of the problem or what resources were being deployed to curb it in the public and private sectors.
With fraud representing the largest category of crime in England and Wales after online scams rose sharply during the coronavirus pandemic, the findings will heap pressure on the Home Office to address the “significant gaps” in its understanding of the scale of the problem.
Gareth Davies, head of the NAO, said: “Five years on from our last report on this subject, the Home Office has taken limited action to improve its response to fraud.
“Its approach has lacked clarity of purpose, it does not have the data it needs to understand the full scale of the problem, and it is not able to accurately measure the impact of its policies on this growing area of crime.”
Fraud accounted for 41 per cent of all crimes against individuals in the year to June, compared with 30 per cent in the year to March 2017, according to the NAO. Online fraud and computer misuse crimes have soared in the past two years, spurred by a rise in people shopping and interacting online during the pandemic.
Yet the number of frauds resulting in a charge or summons fell from more than 6,400 five years ago to just under 4,820 in March, according to government data.
In a series of recommendations, the NAO called on the Home Office to publish a planned strategy to curb fraud as soon as possible and to produce up-to-date measures of its cost to the UK.
The watchdog said there were “significant gaps” in the Home Office’s understanding of the threat from fraud. It found the department lacked a reliable estimate of the cost of fraud to business or the economy and that its £4.7bn estimate of the cost to individuals was based on 2015-16 data.
The NAO said that although the government had launched a series of different strategies covering fraud and economic crime it had yet to set clear outcomes.
It added that government plans spanned a range of topics including cyber security, anti-corruption and organised crime, making it difficult for the Home Office to co-ordinate with other departments and bodies such as the National Crime Agency.
The Home Office was charged with leading five actions related to fraud in the government’s 2019-2022 economic crime plan, but the NAO noted these had all been expressed as activities or aspirations, rather than outcomes.
The Home Office said the government was “absolutely committed to cracking down on fraud and economic crime, spending an additional £400 million over the next three years to tackle it”.
It added that it “recognise[d] more can be done to understand the threat we face and how best to tackle it” and that the forthcoming Fraud Strategy was aimed at “mak[ing] sure there is no safe space for fraudsters”.