Department for Work and Pensions Departmental Report 2003
Executive summary
This Departmental Report presents the Department for Work and Pensions' expenditure plans for social security and employment programmes for 2003-04 to 2005-06. It highlights the progress the Department is making against its “Spending Review 2000” Public Service Agreement (PSA) and details the Department's key other activities during 2002-03. The Report also sets out the Department's revised PSA under the “Spending Review 2002”.
Chapter One
Chapter One sets out the Department's key delivery objectives which are:
- to sustain a higher proportion of people in work than ever before, whilst providing security for those who cannot work;
- to halve child poverty within a decade and to eliminate it within a generation;
- to combat poverty and promote security and independence in retirement for today's and future pensioners; and
- to modernise welfare delivery so as to improve the accessibility, accuracy and value for money of services to customers, including employers.
Effective from 1 April 2003 the Department has a new objective - agreed under the “Spending Review 2002” settlement - which is:
- to improve the rights and opportunities for disabled people in a fair and inclusive society.
The Department's PSA targets are based on these objectives. It has developed a delivery strategy for each of these targets. Underpinning these targets are additional performance targets - set by the Secretary of State for Work and Pensions - to ensure that each of the Department's businesses are accountable for supporting the delivery of outcomes.
Chapter Two
This chapter records how the Department is making progress against its PSA targets relating to its main customer groups: children; people of working age; pensioners; and disabled people and their carers. It also reports progress against the Department's target to reduce the levels of fraud and error in Income Support and Jobseeker's Allowance (JSA).
The Government is committed to ending child poverty and to ensuring that every child can have a decent start in life. It is working towards this aim by giving parents the help and support they need to find and stay in work:
- The Department is working with the Inland Revenue to deliver the New Tax Credits, which were introduced in April 2003. The new Child Tax Credit will help to ensure that families receive all the financial support to which they are entitled whether in or out of work.
- The Government's Sure Start programmes have been further developed to promote the physical, intellectual and social development of young children and enable parents to maximise their opportunities to work, learn and study.
- On 3 March 2003 the new Child Support scheme was launched for new cases. The new scheme will transform and simplify the way that child support is delivered.
- The Department published the fourth edition of “Opportunity for all” (Cm 5598) in September 2002. The Department is making steady progress on its target to reduce the number of children in low-income households even at a time of high-income growth.
- In spring 2002 the Department launched a consultation exercise to seek views on how poverty should be measured in the future, to ensure that the indicators support effective policies and provide a fair way of monitoring progress. Preliminary conclusions from the consultation will be ready for publication during spring 2003.
- Services in the Child Benefit Centre were improved whilst preparing for its transfer to the Inland Revenue from April 2003.
For people of working age the Department is delivering its objective by promoting work for those who can and support for those who cannot:
- The Department has focused increasingly on helping inactive people and the most disadvantaged on benefits to participate in the labour market, building on the success of the New Deals.
- At the same time, it has continued to improve customer services by the further roll-out of Jobcentre Plus - more than 250 integrated offices will have opened by the end of spring 2003.
- The UK has one of the highest employment rates in the world, well above both the European Union 15[Footnote 1] and the Organisation for Economic Co-operation and Development (OECD) averages. In particular, employment rates for most disadvantaged groups have been on an upward trend over the last five years - benefiting from the economic growth and the Department's employment programmes - and the gap with the overall employment rate has been narrowing. However, the trend is flatter for minority ethnic groups and the lowest qualified.
- During 2002-03 work-focused interviews were extended to lone parents on Income Support whose youngest child is between 3 and 5 years old.
- From 28 October 2002 the Department extended joint claims to include couples where at least one partner was aged 45 or under at the time of implementation. Couples meeting the new criteria are required to make a joint claim and meet the Jobseeker's Allowance conditions for benefit entitlement.
- From April 2003 childcare partnership managers are being introduced to every Jobcentre Plus district in order to provide better links between Jobcentre Plus and local childcare.
The Government's objectives for today's and future pensioners are to combat poverty and promote security and independence in retirement:
- Key developments include above-inflation increases in the levels of Retirement Pension payable from April 2003, the commitment to pay the Winter Fuel Payment throughout the lifetime of this Parliament and the successful introduction of the State Second Pension and Stakeholder pensions.
- The Pension Service, established on 1 April 2002, will provide a modern and dedicated service tailored to the needs of today's and future pensioners.
- One of the Department's main priorities for pensioners is the successful introduction of Pension Credit. The State Pension Credit Act received Royal Assent on 25 June 2002. Pension Credit will replace Minimum Income Guarantee from October 2003 rewarding low- to middle-income pensioners who have saved for their retirement. The Government is committed to ensuring maximum take up amongst those who are entitled to Pension Credit and have planned a range of activities to help achieve this.
- The Government is consulting on proposals which are designed to remove obstacles that are inhibiting accurate provision for retirement income based on choice and investment by firms and individuals. Taking forward the outcome of the consultation and implementation of proposals resulting from the Green Paper will be a priority for the Department in 2003-04.
- The Department is working with a broad range of partner organisations, as they are crucial to delivering government objectives. For example, the Partnerships Against Poverty group continues to help inform strategies for ensuring pensioners receive their entitlements; formal partnership agreements to work together have been signed with RNIB and Age Concern and the scope for agreements is being explored with other organisations including the Local Government Association.
The Department for Work and Pensions is responsible for civil rights, employment programmes and benefits for disabled people:
- The Department is raising awareness of the Disability Discrimination Act and promoting positive images of disability, especially amongst employers and service providers; and organising the UK's programme of activities for the European Year of Disabled People in 2003. On 22 January, the Secretary of State announced his intention to publish a draft Disability Bill later in 2003. The Bill will include proposals on the public sector, transport, premises, widening the definition of disability and the inclusion of larger private clubs.
- Through the Disability and Carers Service the Department is implementing in full the Carers' Package announced in November 2000 to improve financial help available to carers. In addition there have been improvements to the Vaccine Damage Payment scheme.
- The Disability and Carers Service is committed to modernising benefit delivery by providing a professional service that is personal, responsive, consistent and reliable and which understands customers' unique needs.
Housing Benefit has a key role to play in lifting people out of poverty and promoting opportunity. However, although £11.5 billion a year is spent on Housing Benefit, it contributes far less than it should to these objectives because of uneven administration. Currently, a complex system creates barriers to work and restricts choice of accommodation for tenants:
- The Government is committed to moving towards payment of standard local housing allowance in the private rented sector. The allowances will be based on rents in the local market, with higher allowances for larger households. This approach will be tested in ten pathfinder local authorities in 2003-04.
- The Department has made significant progress in improving local authority performance in benefit administration. The Local Government Ombudsman for England has reported 'a dramatic improvement in Housing Benefit administration which has led to a dramatic fall in the number of complaints' in the year to March 2002.
- In April 2002, the Government launched national Performance Standards. These new standards cover the full range of administrative activities and set out what needs be done for local authorities to administer Housing Benefit effectively and securely. Through a system of local authority self-assessment they provide the Department with an objective methodology for measuring local authority performance.
- The Government has provided financial and practical support to help local authorities meet the targets set down for them by, amongst other things, investing £200 million over three years in a standards fund to help local authorities fund improvements in their service.
The Government aims to reduce the amount of fraud and error by having a benefit system that is secure throughout the life of a claim. The Department is working to achieve this by measures which get things right at the start of benefit claims, keep them right by checking and monitoring and put them right when they go wrong, including prosecuting people committing fraud:
- The number of sanctions employed continues to increase. In partnership with local authorities over 29,000 people were prosecuted or sanctioned in 2001-02, compared to more than 21,000 in 1999-2000.
- The Department has continued to make extensive use of data matching to identify inconsistencies and possible instances of fraud and error across a range of benefits. From April 2002 to January 2003, 165,654 inconsistencies in the data were identified for further investigation by the Department's staff, and 64,150 inconsistencies in the data were identified for further investigation by local authority staff. These resulted in overpayments of £32.2 million and £23.8 million being identified. Wherever appropriate, sanctions or prosecutions and action to recover these losses have been taken.
- The Social Security Fraud Act 2001 includes the power to obtain information from financial institutions where individuals are suspected of fraud. 112 departmental officers have been 'authorised' by the Secretary of State to use this power with a further 90 officers being 'authorised' by chief executives in the local authorities. An average of 1,500 enquiries a month are now being made by Intelligence Units under this new provision and the figures are rising steadily.
- The Targeting Fraud advertising campaign tests the use of advertising as a tool for changing public attitudes. The earlier campaigns addressed attitudes towards the acceptability of benefit fraud and delivered the message that the Government is cracking down on fraud. Evaluation showed an increased level of awareness, coupled with a positive shift in public attitude.
- The Department helps local authorities to fight fraud and error in Housing Benefit by setting standards, providing funding and rewarding results. The Housing Benefit reforms announced in October 2002 will further help local authorities to tackle fraud and error.
The Benefit Fraud Inspectorate (BFI) is the only inspectorate within the Department. Its remit is to inspect benefits administration and counter-fraud activity within the Department's agencies and also local authorities:
- The BFI has now inspected authorities responsible for 55 per cent of all Housing Benefit and Council Tax Benefit expenditure. An important part of the work programme is follow-up inspections, where authorities are visited for a second time to assess the progress made implementing the recommendations from the first inspection. Considerable improvements have taken place in the majority of authorities inspected for a second time.
- In 2002 the BFI launched its Performance Improvement Action Team. This innovative service shares the BFI's wealth of inspection expertise and specialist knowledge with local authorities committed to improving their delivery of Housing Benefit and Council Tax Benefit. To date the Action Team has worked with 15 authorities.
Chapter Three
This chapter reports on the aims, objectives, and performance of each of the Department's four executive agencies and on the Benefits Agency and the Employment Service, both of which ceased operation on 31 March 2002. It also provides information on the Department's Independent Statutory Bodies:
- Jobcentre Plus met its targets for helping people into work, serving its customers well and helping employers to fill their vacancies. The Business Delivery target was met for the second half of the year.
- The Pension Service's performance against its targets has been affected by a number of factors, most notably the need to prepare for the implementation of Pension Credit and organisational restructuring. Nevertheless, The Pension Service has maintained high levels of service for Retirement Pension and Minimum Income Guarantee. There have also been improvements in the information available to future pensioners, helping them make decisions on their pension arrangements.
- The Child Support Agency has continued to make significant progress in improving business performance. It has implemented early elements of the new Child Support scheme and reorganised in preparation for the new arrangements.
- During 2002-03 the Appeals Service significantly improved waiting times for appeals to be heard, continuing to focus on addressing regional variations in waiting times.
Chapter Four
This sets out the corporate strategies and shared services that support the management and efficient operation of the Department as a whole, in particular in the areas of human resources, finance, estates and information technology (IT):
- A Human Resources (HR) change programme has been put in place to help the Department and its businesses deliver their organisational objectives through modernising and transforming both HR policies and delivery, including a leadership and manager development strategy. The Department has developed a pay and workforce strategy for 2003-06. The strategic goal is to achieve a smaller, better-skilled, better-motivated workforce, benefiting from investment. The strategic aim is to reduce the Department's workforce from just under 131,000 at April 2003 to around 112,000 by 2006 as the benefits of a significant programme of change and modernisation are realised.
- The Department for Work and Pensions is accountable for around £108 billion of public expenditure - the largest single departmental budget - so ensuring proper control of these resources is critical to support the Department's business. The Comptroller and Auditor General qualified the accounts of the former Department of Social Security because of significant levels of fraud and error in benefit awards and significant uncertainties over certain debtor and creditor balances. The Department is investing in new financial management systems with the aim of removing the technical qualifications by 2005-06.
- The Department has the largest estate of any civil government department and one of the largest occupied estates in the country. The significant changes to the Department's organisational structure require a clear estates strategy to support the businesses and achieve value for money. The Department's estates strategy is designed to meet the changing space and staffing requirements as the Department moves to new service models - such as integrated Jobcentre Plus offices and Pension Centres - over the next three years.
- The Department's modernisation programme is a major undertaking - one of the largest programmes of its kind in Europe. It is seeking to deliver sweeping improvements to the services offered to customers and will have a major impact on the lives of the Department's 26 million customers and will play a fundamental role in the achievement of the Department's objectives. For example, it will support the Government's drive to eliminate child poverty through implementing Child Support reform and the New Tax Credits, and in ensuring security in retirement for future pensioners through computer systems able to generate pension forecasts which take into account both state and private pension entitlements.
Chapter Five
The Health and Safety Commission's (HSC) and Health and Safety Executive's (HSE) mission is to ensure that risks to people's health and safety from work activities are properly controlled. The HSC is responsible for securing the health and safety of those at work and those affected by workplace activity; the HSE is responsible for implementing the HSC's work. Both the HSC and the HSE are independent statutory bodies, supported by the Health and Safety Sponsorship Division within the Department:
- In June 2000, the Government set national targets for all stakeholders in the health and safety system published in the Revitalising Health and Safety Strategy Statement. The HSC's Strategic Plan 2001-2004, published in October 2001, focuses the HSC's activity on achieving the national targets.
- Since spring 2002, the majority of the HSE's inspections have concentrated on the effective control of the hazards identified under its Priority Programmes as the prime means of judging duty holders' control of risks. Furthermore, the HSE has developed performance indicators for each of the hazard-based priority programmes for its inspectors to record the standards found when visiting workplaces and against which further improvement can be measured.
Chapter Six
This chapter sets out in detailed tables the Department's expenditure plans 2003-04 to 2005-06 in resource terms, staffing numbers and expenditure on benefits.
1 The 15 Member States of the European Union.
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