The Department of Work & Pensions (DWP) has finally got around to producing a report they last did in June 2011 – How much welfare benefits goes unclaimed in simple terms.
£66 MILLION OF WELFARE GOES UNCLAIMED EVERY DAY IN THE UK
This is as much as £15.657 billion per year in Pension Credit, Income Support, ESA, JSA and Housing Benefit alone. It will be more when all welfare benefits are included.
In June 2011 HMRC also published a report stating that £8.344 billion per year in Tax Credits goes unclaimed. If that is the same this makes a staggering £24 billion in ‘welfare’ that goes unclaimed. £24 Billion is £66 million per day!
The government are struggling to find half of that or £12 billion in cuts.
More significant is when Universal Credit is fully rolled out UC provides a one stop assessment for all benefit and tax credit you are entitled to and pays out that amount.
Universal Credit will cost at least £24 billion per year more in welfare as it pays 100% of what you are entitled to – not a penny more and not a penny less as I have often said and last did in February this year saying it would cost at least £20 billion per year MORE.
Ergo, Universal Credit is just another back of a fag packet politically motivated policy from the I believe it will work mentality of Iain Duncan Smith and his own departments figures in this report prove that.
The Detail
The report referenced above has a title which states its purpose
The overview or executive summary on page 3 states all we need to know and I have emphasised the take-up / non take-up of each benefit mentioned by expenditure (from another official DWP report) and then cross-referenced this to arrive at the above figures.
Page 3 says
Here’s the numbers bit (not as difficult as it may read) and I explain this for Pension Credit figures and the same method applies to Income Support, Employment Support Allowance, Job Seekers Allowance and Housing Benefit and summarise in a table below.
Pension Credit
- The report says in money terms (expenditure) that the DWP paid out between 67 per cent and 73 per cent of what was entitled in financial year 2013/14.
- We know from another DWP official report that the amount it paid out was £7.042 billion in Pension Credit (see below)
- So this £7.042 billion is between 67% of what should have been paid or the entitled amount is £10.510 billion or 73% ot what was paid out making the entitled amount and what should have been paid out between £9.647 billion and £10.510 billion.
- What has actually been paid in Pension Credit was therefore £2.605 to £3.468 billion LESS than what should have been.
OR – Up to £3.468 billion per year has gone unclaimed by those who were entitled to it.
AND – Once Universal Credit rolls out given it pays you 100% of all the benefits and tax credits you are entitled to with its one stop assessment then once UC does roll out this £3.468 billion of Pension Credit that now goes unpaid will be paid.
The same happens for all of the other benefits mentioned in the report and I summarise that in the table below.
That as you can see details up to £15.657 billion per year that the DWP admits that it knows claimants are entitled to yet do not claim.
£42 million per day in just 5 welfare benefits alone goes unclaimed
The data for actual spend is as referenced above and here is a compilation of screenshots which show it is expenditure costs and for 2013/14 which is the same financial year as the non-take up report that I have emphasised in red.
The £8.344 billion of Tax Credits (working tax credit and child tax credits combined) which went unclaimed I reported here in June 2012 though I note that HMRC has now archived the details but I will dig them out just in case anyone disputes them.
So in summary we have £24 billion per year of ‘welfare’ that we know goes unclaimed and the government (DWP & HMRC) admits to – the best part of £66 million PER DAY of welfare to which people are entitled to, goes unclaimed. And note well this only accounts for the non take up of just 5 welfare benefits so it will be more than this.
Finally, just in case anyone chooses to make an argument that this means UK benefits are too high I leave you with the findings of the Council of Europe (and nothing to do with EU and pre-dates it too) which said last week that UK Pensions, Incapacity and Job Seeker Allowance levels are MANIFESTLY UNJUST or not just low but shockingly low!
So just who is CONning who when it comes to welfare!
SPeye Joe (Welfarewrites) 
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The frustrating truth is that UC will roll out to much positivity from IDS and chums and it will only be when the welfare system goes into meltdown that any sort of acknowledgement of mistakes made will be forthcoming. The lives of IDS and chums will be unchanged apart from a likely period of time spent on the opposition side of the house with a bit of name calling. Without real accountability for decisions they make , politicians will continue to play their games without real regard for those they serve.
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UC is a disaster waiting to happen. The DWP has no experience at all in administering housing benefit. If you get sanctioned it will be all your benefits that are cut off, not just JSA or ESA. If they make a mistake and dont pay, the wont be paying anything, including housing benefit. And all benefits will be paid to one person in each household; lets hope that one person isnt an addict. Or a controlling bully.
From the blogosphere, Universal Credit will mete out permanent sanctions to the unemployed and to the working part time poor for failing to do the impossible of gaining full time hours,, by Hardship Payments becoming recoverable loans by court action against future benefit or wages.
And where UC is piloted, Pension Credit is not paid out if either of a couple is below the raised retirement age, which will usually be the wife, as their retirement age rose in 2013 for half a decade.
UC will absorb housing benefit and working tax credits, and could absorb council tax support.
So sanctions will cut benefit to the unemployed and to the working poor even more.
Reblogged this on SPeye Joe (Welfarewrites).
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Great blog post Joe. Very scary stuff. Do you know if the amount unclaimed is people not claiming any benefits they are entitled to full stop or they are claiming benefits but not as much as they should be? Is there scope that the UC one stop assessment might be fudged to keep the amount of UC payment down or is it black and white and therefore this disaster waiting to happen will…..
The UC assessment can’t be fudged so it is a disaster as I first pointed out 4 years ago. ALL paid not a penny more not a penny less.
Is this the real reason for the cap then?
Not in my view Kevin as it is likely those that now do not claim will be exempt from cap – those in work and while Pension Credit is NOT a cap exempt benefit, no politician will benefit cap those over 60 given the political fallout.
The simple reason is that IDS’s great plan (UC) failed to consider the non take-up of benefit from the beginning and it was well known and recognised that successive governments for last 30/40 years have only set aside 60 -70% of all means-tested benefits as so many do not apply for many reasons, often lack of knowledge or myth (eg HB is only available if you are out or work) and pure and simple pride.
Imposing a system of you get ALL you are entitled to (UC) which overlooks the non take up is chronic ineptitude. The non take up may even be higher as the figures above are those the DWP ADMITS to knowing about and just compounds the incompetence.
UC also failed to consider supported housing in its development too hence the debacle of LHA + £20/£40 etc that has led to it being outside UC and the wider “specified accommodation” replacing the old “Exempt Accommodation” (and that farce was why I started blogging in first place).
UC was dreamt up by the CSJ – the think tank IDS set up – so that we would not remember IDS as the worst party leader ever but as the gallant hero who took on the burgeoning welfare state and heroically failed! Now he and his policies are (at last!) beginning to be found out, such as his deliberate and known lies, and Corbyn will actually scrutinise and oppose all of these falsehoods and UC’s rank incompetence will emerge and the “welfare” agenda will be seen for what it is in a charade.
UC is a disaster waiting to happen and the reason for that is chronic ineptitude as I first said all those years ago.
PS – The reason for the overall benefit cap is political spin alone. We have always had a cap on welfare benefits and child benefit and child tax credits – all are the same level wherever you reside and that is a cap. The ONLY variable is housing benefit and HB is the only benefit that does vary .
The £26k cap limits ‘welfare’ to first 6 children or less than 1% of all claimants; the £20k limits ‘welfare’ to first 4 children (ie no HB paid) and just over 4% of all claimants