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Southwark Council saves £500k via NFA investigation

Charlotte Jee Published 18 December 2012

Data matching pilot revealed bogus council tax discounts and exemptions for students


Southwark Council has saved £500,000 by reviewing council tax discounts and exemptions awarded to residents who are no longer students.

The data matching investigation, which compared student records with housing records, uncovered 423 cases where former students were claiming council tax exemption, despite no longer being students. Full-time college or university students are fully exempt from paying council tax and Southwark has a large student population, with roughly 2,400 households occupied by students who are not required to pay council tax.

The investigation, which commenced in 2011, compared information about students' records, courses and learning establishments, and identified 750 possible 'high risk matches' where individual claimants' statuses were unclear. A follow-up resulted in council tax discount awards being removed in 56.4% of cases, equivalent to 423 individuals.

The National Fraud Authority (NFA), an executive agency of the Home Office, and Fujitsu partnered with the local authority to conduct the pilot initiative, which is part of a broader anti-fraud campaign in Southwark. The pilot was also part of the NFA's local government strategy 'Fighting Fraud Locally'.

Issues with fraud are by no means confined to Southwark, however. According to the NFA's 2012 Annual Fraud Indicator, housing tenancy fraud costs local government bodies £900m every year. Other housing-related fraud, including housing benefit fraud and council tax fraud, are estimated to cost local authorities £300m and £131m a year respectively.

Cllr Richard Livingstone, cabinet member for community safety, finance and resources, said the savings represented significant additional income for the Council. He added, "Former students who fail to notify Southwark Council that they are no longer students and therefore no longer eligible for the council tax student discount are committing fraud.

"Not only is this illegal and unacceptable, but as part of our anti-fraud campaign we have escalated our efforts in tackling fraudsters and recovering monies. Genuine students have nothing to worry about. This work complements our review on single person discounts. Committing fraud against the Council is stealing from your friends, family and the community."

Stephen Harrison, chief executive officer of the NFA, said, "Our research indicates that student council tax is one of the main areas where councils are exposed to fraud. As part of the development of our local government strategy 'Fighting Fraud Locally' we have worked closely with Councils, including Southwark, to pilot a scheme to root out council tax evaders.

"Fraud is not a victimless crime and as a result of this pilot Southwark Council have identified additional income. Other councils could learn a lot from this pilot."

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