| |  | Our latest report finds that HMRC's use of Home Office travel data to address fraud and error in Child Benefit led to initial savings of £60 million, but over half of the people who had their benefits suspended were genuine claimants.
HMRC identified a new opportunity to use Home Office travel data to identify people who were not living in the UK and who could be incorrectly claiming Child Benefit. Early pilots suggested it could secure significant savings for the taxpayer.
However, as it scaled up activities following the pilot, HMRC changed how the process operated. It removed an upfront check of employment records on its PAYE system and sent out longer, more complex letters and questionnaires to most claimants to prove their eligibility. While HMRC estimated it saved around £60 million initially, over half of people who had their benefits suspended were genuine, eligible claimants.
After problems began to emerge, HMRC took steps to improve the process. It is now adopting a more controlled approach and learning lessons about managing risk and the impact of its interventions on claimants.
HMRC should continue to try new and innovative approaches to tackling fraud and error, but it must balance the effectiveness of any approach without losing sight of the impact on people.
| | Read the report | |
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