Work and Pensions Committee
Wednesday 4th November 2026
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09:31
Debbie Abrahams
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Debbie Abrahams
And welcome to this evidence session on the DWP Annual Report and Accounts. And it's a pleasure to welcome the new Permanent Secretary, Dame Sarah Healey. Your first session with us here today. Very warm welcome. And you're joined by Catherine Vaughan. And I have your title Catherine here. You're the director general for finance. And Catherine Greene, director general for labour market and Skills. And Neil Warm welcome again, your director general for services and fraud.
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Speaker 1
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Speaker 1
Thank you so much, chair. And I just want to say like, it's obviously a real pleasure to have the opportunity to have such a wide ranging session with the committee as the very first time I've actually been in post just over 100 days. I think that's the kind of new job marker that people tend to use. So it's a good moment to to pause. And I want wanted to sort of start really by just paying tribute to Peter as my predecessor. I, Peter was a much valued colleague for me around the permanent secretary table and had been for seven years in my previous roles.
But it's obviously only when you actually succeed someone that you really get an impression of the sort of scale and breadth of everything that Peter handled and managed in DWP and what he did. As for sort of first impressions, obviously I sort of knew about the scale of what DWP did and the scale of its operations, but you can't really help but be very, very struck by it and struck by its kind of both national and local presence. When you come in the the scale of its operations, the extent of its interactions with the public, and also, I think, kind of the significance of the outcomes that it's trying to affect through interactions with customers.
And that has been very striking. I've also been really struck by the enthusiasm and commitment of the DWP staff I've met in different parts of the country, visiting job centres and service centres since I started, and a real sense of passion for what they do, but also a kind of passion for trying to change what they see in front of them and change the way that they work to try and improve outcomes. I think in many places as well, I've been struck that we really do have world leading systems and processes for making those changes happen.
But when you talk about things I would like to change, I think it is fair to say that I've heard from people, both in the core sort of HQ of the department, but also in operations, that they don't always have the systems that they need in order to do their jobs as well as they would want to. They are things that hold them back in trying to achieve what they want to achieve. as well. Quite often we are working on extremely old computer systems. We are working on kind of processes which are quite inflexible and don't necessarily allow people to tailor the support that they want to give to the, to the customers that are in front of them.
And you can really see the benefit that comes when those change. So I visited the child maintenance service and hearing about their digital transformation. What a difference it's made to the way that they operate. It's very, very striking, kind of the satisfaction that comes for the people who are working on these cases when they actually are dealing with much more modernized systems. So I do think there is a lot still to do on the sort of back office systems and processes. We're obviously only partway through the reform of the Jobs and Careers service. And so I'm very, very keen to learn from our Pathfinders there and ensure that we're encouraging innovation in the jobs and careers service up and down the country.
But it's obviously only when you actually succeed someone that you really get an impression of the sort of scale and breadth of everything that Peter handled and managed in DWP and what he did. As for sort of first impressions, obviously I sort of knew about the scale of what DWP did and the scale of its operations, but you can't really help but be very, very struck by it and struck by its kind of both national and local presence. When you come in the the scale of its operations, the extent of its interactions with the public, and also, I think, kind of the significance of the outcomes that it's trying to affect through interactions with customers.
And that has been very striking. I've also been really struck by the enthusiasm and commitment of the DWP staff I've met in different parts of the country, visiting job centres and service centres since I started, and a real sense of passion for what they do, but also a kind of passion for trying to change what they see in front of them and change the way that they work to try and improve outcomes. I think in many places as well, I've been struck that we really do have world leading systems and processes for making those changes happen.
But when you talk about things I would like to change, I think it is fair to say that I've heard from people, both in the core sort of HQ of the department, but also in operations, that they don't always have the systems that they need in order to do their jobs as well as they would want to. They are things that hold them back in trying to achieve what they want to achieve. as well. Quite often we are working on extremely old computer systems. We are working on kind of processes which are quite inflexible and don't necessarily allow people to tailor the support that they want to give to the, to the customers that are in front of them.
And you can really see the benefit that comes when those change. So I visited the child maintenance service and hearing about their digital transformation. What a difference it's made to the way that they operate. It's very, very striking, kind of the satisfaction that comes for the people who are working on these cases when they actually are dealing with much more modernized systems. So I do think there is a lot still to do on the sort of back office systems and processes. We're obviously only partway through the reform of the Jobs and Careers service. And so I'm very, very keen to learn from our Pathfinders there and ensure that we're encouraging innovation in the jobs and careers service up and down the country.
09:35
Speaker 1
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Speaker 1
Indeed, indeed, I've seen I've seen both the report and the correspondence about it. And I also just think it's worth reflecting a little bit on the context that we're in, in all of this, because actually, I do think coming up in the next few months, there are a set of things that we will need to respond to, as well as things we ourselves would want to change. Say, for instance, clearly the Prime Minister's ambition on devolution will be something that I know the committee is thinking about and you will want to ask about today. We will have the Milburn and Timms reviews coming up for publication.
That will make a difference to how we do our jobs, and it is worth also reflecting that we are operating at a time of serious fiscal pressure. We sort of played that saw that played out in the budget, and that is something that DWP will want to think about as we go into a spending review at some point in the next year or so, and then I'm sure committee will want to, as it has done in these similar hearings before, touch on AI and technology. I think it is technology, including AI rather than AI alone, but it is obviously beholden on the department to make sure that we're taking advantage of the opportunities that gives to enable our people to work better, but also addressing some of the risks and challenges that we know arise with that kind of new technology.
That will make a difference to how we do our jobs, and it is worth also reflecting that we are operating at a time of serious fiscal pressure. We sort of played that saw that played out in the budget, and that is something that DWP will want to think about as we go into a spending review at some point in the next year or so, and then I'm sure committee will want to, as it has done in these similar hearings before, touch on AI and technology. I think it is technology, including AI rather than AI alone, but it is obviously beholden on the department to make sure that we're taking advantage of the opportunities that gives to enable our people to work better, but also addressing some of the risks and challenges that we know arise with that kind of new technology.
09:37
Debbie Abrahams
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Debbie Abrahams
Indeed. Well, let's let's start then . In terms of the devolution by default approach and accounting officer, what are your how do you see this? How do you see this as an opportunity? Do you see it as a a major risk? And if so, have you? Is it on your risk register? You know what, what, how do you see this and how are you going to mitigate against those risks?
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Speaker 1
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Speaker 1
Very helpful. And I hope well, I hope it's going to be helpful as DWP kind of navigates that sort of scale of ambition and therefore was responsible for lots of conversations with my fellow accounting officers, Peter included, around government as we set up the integrated settlement and thought about the ways in which we could preserve accounting officer accountability and a sort of devolved world. Remembering that DWP obviously has committed to devolving more, but already devolves over the course of the spending review, 3.1 billion of employment support and other funding as part of the integrated settlement.
So I'm very familiar with the mechanisms that are currently in place for the integrated settlement, but I think it is very, very clear that those are going to have to transform and change over the course of the next few years, not least because of two Not least because of two things. First of all, the commitments that were set out in the rewiring the state blueprint is driving all of those things after after three months in in post. I do think there .
So I'm very familiar with the mechanisms that are currently in place for the integrated settlement, but I think it is very, very clear that those are going to have to transform and change over the course of the next few years, not least because of two Not least because of two things. First of all, the commitments that were set out in the rewiring the state blueprint is driving all of those things after after three months in in post. I do think there .
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Speaker 1
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Speaker 1
That we would want all of our customers to feel that they have been receiving a very good service and that they are treated with respect in their interactions with staff. And actually, I think that's what our staff would like as well, and they would want to see that. So , I mean, a couple of reflections and I might ask Neil to come in since Neil is very is very familiar with the, the services that we offer and knows much more about them than I do. Which is just that in the reform that we're trying to do on the Jobs and Careers service, one of the key things I've heard from people in the Pathfinders that I've visited is the benefit that they have in being able to have some.
flexibility in how they interact with customers, because when they're very sort of fixed in the way that they can do those interactions, it can be hard to take people's individual. circumstances into account. And I can really see that when that if people feel their individual circumstances are not taken into account, that can really affect the degree of satisfaction that they feel with those services. And then I'd also point to things that we can learn from other.
modernisation that we've done in DWP. So for.
flexibility in how they interact with customers, because when they're very sort of fixed in the way that they can do those interactions, it can be hard to take people's individual. circumstances into account. And I can really see that when that if people feel their individual circumstances are not taken into account, that can really affect the degree of satisfaction that they feel with those services. And then I'd also point to things that we can learn from other.
modernisation that we've done in DWP. So for.
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Speaker 4
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Speaker 4
Day where they can call a helpline. But Neil, I don't know if you want to reflect further. Yeah, I've got slightly more than 100 days experience. I can't use that excuse 40 years, but I think I'd ask the committee to. remember that we do some quite difficult stuff. And you heard last week from the minister, Maeve Sherlock, about just how hard it is sometimes administering a child maintenance claim. And that happiness for one of the parties is unhappiness for the other. That's the sort of thing that gets picked up in some of these surveys. And, you know, we want to improve.
We want people to be. satisfied with their. interactions with us. But sometimes we are saying to them, no, you're not entitled to this benefit.
We want people to be. satisfied with their. interactions with us. But sometimes we are saying to them, no, you're not entitled to this benefit.
09:50
Peter Bedford
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Peter Bedford
And they will feel that they are and they will channel that point. I just wonder if there's if you would reflect on the quality or the kind of questions being asked. So there's a difference between a decision being wrong and a process or an experience. The two are separate. So I can be unhappy that I don't. I'm not entitled to a particular benefit, but I feel like I've had a fair hearing.
I've had a good .
I've had a good .
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Speaker 4
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Speaker 4
Agree with, but how the survey works, it is with people who have had a recent interaction with us. So, you know, it will pick up. frustration with outcome as well as give us important. feedback on the quality of the service that we've delivered. And it's probably. difficult to interlink those two from a survey response. So I'm not complacent about this and I'm not dismissing it.
Not not in the least, but it is worth bearing that that that in mind, it's a bit different than, say, getting a driving license .
Not not in the least, but it is worth bearing that that that in mind, it's a bit different than, say, getting a driving license .
09:51
Peter Bedford
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Peter Bedford
Renewed or your passport renewed where there's a straight outcome to it. Just turning on to staff, staff surveys and the perception amongst your your own employees. I think in 2025, the people survey said only 53% of your staff responded. positively to questions about managing change. Now, clearly, there's a lot of change going on in the department, both in terms of policy and in terms of.
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Speaker 1
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Speaker 1
Positively to that, how are you going to achieve that change? So again, I really wouldn't want you to think in responding, just pointing this out that I'm in any way thinking that there isn't more we can do. And we obviously want, you know, vast majority of our staff to feel that change is is managed well. But I was actually looking at those results only yesterday in preparation for coming to the committee and actually reflected that in comparison to the rest of Whitehall, we're doing rather well on on managing change. Most of the other departments across government, and there is a very difficult score to increase.
Actually, in my experience as a permanent secretary, even at DCMs, where I was the permanent Secretary for three and a half years and was a much smaller. department which didn't deliver services and therefore experienced the the sort of scale of change that DWP does. It was actually really hard to get that score over 50%, and this was a department which had the highest engagement score in Whitehall. So overall, people were very, very engaged by the department. They loved working there. But that particular measure is really hard to get up because people do find it difficult to deal with change.
They do find change hard. I am not suggesting we shouldn't be trying to push that score up, but considering the scale of what DWP does, I actually think the rest of Whitehall have got something to learn from us about how we've done it in the past and what it has involved, and I think that is partly because the the things that we. change frequently make the lives of the people who work for us easier because they are improvements to systems. They are kind of changes in the ways that they work that are positive. There are obviously some issues that are reflected in that score which are challenging, not least kind of changes in policy or changes in in.
Actually, in my experience as a permanent secretary, even at DCMs, where I was the permanent Secretary for three and a half years and was a much smaller. department which didn't deliver services and therefore experienced the the sort of scale of change that DWP does. It was actually really hard to get that score over 50%, and this was a department which had the highest engagement score in Whitehall. So overall, people were very, very engaged by the department. They loved working there. But that particular measure is really hard to get up because people do find it difficult to deal with change.
They do find change hard. I am not suggesting we shouldn't be trying to push that score up, but considering the scale of what DWP does, I actually think the rest of Whitehall have got something to learn from us about how we've done it in the past and what it has involved, and I think that is partly because the the things that we. change frequently make the lives of the people who work for us easier because they are improvements to systems. They are kind of changes in the ways that they work that are positive. There are obviously some issues that are reflected in that score which are challenging, not least kind of changes in policy or changes in in.
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Speaker 1
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Speaker 1
Which are an inevitable part of the civil servants life. And so they should be that I think are reflected to some degree. But I have always thought that the most important thing that you can do, if you want to raise that score and you want to see people be even more positive about the way that the department manages change, is focus really heavily on your communications and engagement. So really, people want what they want to understand. When you're changing something is that you are changing it, why you are changing it, whether they are being involved in the decision about how, what the change will be, or whether they're being involved in the decision about how you're going to roll it out.
Clarity about that and an opportunity to give feedback. And I've always said that one of the things that I that I prioritise most in the departments that I've run is trying to create a culture in which people feel safe to.
Clarity about that and an opportunity to give feedback. And I've always said that one of the things that I that I prioritise most in the departments that I've run is trying to create a culture in which people feel safe to.
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09:54
Rushanara Ali
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Rushanara Ali
Got to say. Thank you so much for. Thank you. Good morning, Dame Sarah. I had a follow up follow up on the devolution agenda, and you talked about wanting to see. The areas learn from each other and where there's good results and progress supporting others to, to, to also follow that. Can you talk us through how you're going to make sure that this very exciting agenda of transferring more power and resources to local areas, closer to communities, which we, we, you know, of course, broadly, we can all see the benefit of that, but the concerns are around outcomes and how the department will oversee and set up a set of processes that will get you the results that you want to see in terms of improvement, good value for money and support to those areas that are struggling.
Do you feel that Whitehall and of course, your former department have the powers and the. The institutional frameworks to get better outcomes in areas where there are poor outcomes at the local level? And is the system acting fast enough to make sure that those institutions that are not performing well, failing or failing is adequate enough to be able to get that improvement so that people's lives are not affected because of poor leadership at the local level. And of course, that doesn't exempt the national side as well, where that is an issue .
Do you feel that Whitehall and of course, your former department have the powers and the. The institutional frameworks to get better outcomes in areas where there are poor outcomes at the local level? And is the system acting fast enough to make sure that those institutions that are not performing well, failing or failing is adequate enough to be able to get that improvement so that people's lives are not affected because of poor leadership at the local level. And of course, that doesn't exempt the national side as well, where that is an issue .
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Speaker 1
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Speaker 1
And what are you going to do about that? So I'll start and then I'll actually hand over to Catherine, who's been thinking about this quite a lot in the context of sort of transfer of contracts previously held by the department. I mean, the first thing I would say is that the integrated settlement comes with IT and outcomes framework. We spent a lot of time. negotiating what was in the outcomes framework. It is very important that it is pitched at a level where it enables the kind of.
innovation and.
innovation and.
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Speaker 1
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Speaker 1
And local design. That is the great benefit of devolution, while at the same time. expressing what is very, very. important in terms of holding people to account and testing their performance. We've got tried and tested ways in Mhclg of intervening, where we see failure and a process of assessing against that outcomes framework through.
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Speaker 1
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Speaker 1
And also to work out what an accountability system like that looks like when you've got fiscal devolution. And I think, you know, the government has set out its plans to do more, to say to say more about how it's going to deliver. devolution before the end of the year. And I think we can see there some more in-depth thinking about how that's .
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Speaker 5
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Speaker 5
And it's very much at the forefront of mine and my team's thinking at the moment. As an example, we're setting up a What Works. centre for local employment support in collaboration with the Economic and Social Research Council. That's going to go live in January next year, which is a structured way to enable sharing of. evaluation about what works so that people can learn from each other. There is a lot we are thinking about in terms of what data we can make.
available to local areas. So thinking about making it simpler to share data across.
available to local areas. So thinking about making it simpler to share data across.
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Speaker 5
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Speaker 5
We will be in a few weeks time making our public explore data cut by combined authority and mayoral strategic. authority layers, so that local areas can look differently at some of the publicly available stats about what's going on in their area. And then we already deliver a huge amount in. partnership with with local authorities and strategic as male or strategic authorities. So connect to work, which I think the chair mentioned earlier, is delivered .
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10:00
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Rushanara Ali
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Rushanara Ali
That there are strong foundations for us to continue to build on. Well, thank you very much. So turning to the issues around responding to mistakes , the department in recent years has had a quite a quite a few reviews and investigations and correction exercises into administrative failures. You know, we recognise that this as you said, this is a department with a huge amount of responsibility, very complex and and a lot that is different from other departments. But it would be useful to get your reflections on why you think what you think is going wrong and what .
10:00
Speaker 1
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Speaker 1
You intend to do to fix fix it. Thank you. And it's obviously kind of right that we should be attempting to be as accurate as. possible and not see some of those errors of the past repeated and get as much right as possible first time. I mean, I've already set out that one of the challenges here is that not all of our systems and. practices for nobody's fault are as necessarily as strong or as modern as they should be. And indeed, I know when Peter was permanent secretary, he did a lot to try and look at how to fix those underlying systems and processes, including initiating a number of pieces of work to improve them.
The review that he asked the government internal audit agency to do to look at how we update operational guidance, being a good.
The review that he asked the government internal audit agency to do to look at how we update operational guidance, being a good.
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Speaker 1
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Speaker 1
As you say, and I know you acknowledge this kind of with with. 23 million customers a year and. 600 million payments going out, I think it would be. really I don't think it displays complacency to say that inevitably some things will go wrong. That is partly because we are dealing with the complexity of people's lives and the complexity of their.
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Speaker 1
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Speaker 1
And I really am not here to make a set of. promises that somehow, under my watch, nothing will ever go wrong. That would be extremely foolish thing for me to do. But a few things that we can do, I think, to build on what is already happening in the department to try and address some of this. We can obviously modernize our systems, and I'm sure we'll want to talk later about some of that service modernization we've got underway. We can, of course, train and develop the capacity of staff and capability of staff. And if we think about the safeguarding example, I think it's a good example of where kind of in order to improve the quality of practice and prevent errors in how people are dealing with vulnerable customers.
We've been doing that. Again, we can deal with the culture of raising issues quickly when they arise. I think it's really important that we do that in a way that avoids sort of punitive sense of blame on staff who where things may have gone wrong, because actually that sort of defeats the aim of. transparency and sort of doesn't encourage people to come forward. So it's important to do in a way that's kind of safe and where we're being clear with staff that they're safe to raise those.
We've been doing that. Again, we can deal with the culture of raising issues quickly when they arise. I think it's really important that we do that in a way that avoids sort of punitive sense of blame on staff who where things may have gone wrong, because actually that sort of defeats the aim of. transparency and sort of doesn't encourage people to come forward. So it's important to do in a way that's kind of safe and where we're being clear with staff that they're safe to raise those.
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Speaker 1
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Speaker 1
We need to reflect on and have in all the kind of reviews that we've done, reflected on what we've learned from the things that have gone wrong, I think is, however, sort of worth saying that I think it would be a little. unfair to. conclude from the different issues that we know are very serious. And I'm definitely not sort of suggesting that they're not very serious, that they suggest a sort of single cause in the department, not least because they happened at different times. So, you know, some of the things that we're dealing with in terms of state pension age.
notification were sort of 20 years ago, some of the things that we know we need to respond to, such as care and carer's allowance overpayments, which I'm sure you'll also come on to later happened more recently. So I think, you know, there's a range of times. So we shouldn't I don't think what we should be searching for is one .
notification were sort of 20 years ago, some of the things that we know we need to respond to, such as care and carer's allowance overpayments, which I'm sure you'll also come on to later happened more recently. So I think, you know, there's a range of times. So we shouldn't I don't think what we should be searching for is one .
10:04
Rushanara Ali
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Rushanara Ali
Single cause and one single set of actions. We need to take action across a wide range. But I think what we're interested in is what's going to be done to address those, because I recognize your point about complexity, but . when you've got people who are at the receiving end of mistakes, I mean, we've got a number of, you know, number of cases, issues, state pension underpayments. You said legacy, S&P premium pay, National Insurance number errors.
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Rushanara Ali
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Rushanara Ali
Then of course, there's the civil service pensions issue, which is coming up, which has come up. A number of us have dealt with that, where civil servants who've given a life of service and not getting their pensions. And, you know, I've got a case like that at the moment, a number of cases. So so the reality of what it means to people's lives, which is why this department is so important and we're invested in wanting to see, see progress.
Can I just take you to the, the point, the question of the e .
Can I just take you to the, the point, the question of the e .
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Speaker 1
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Speaker 1
So I mean, as the committee will be aware, we have been involved in a confidential. process of engagement with the HLC about their review, which is obviously on a subject we take very seriously and we recognise the importance of in dealing with particularly vulnerable clients. And I know the committee are particularly interested in how DWP engages with those who have the. greatest needs, and we often deal with people at very vulnerable points in their lives. We'll obviously want to update the committee about where we've got to on that as soon as we possibly can, but that is currently.
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Debbie Abrahams
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Debbie Abrahams
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Speaker 4
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Speaker 4
Which led them to initiating two years ago. You were quite right. A section 20. investigation of us. We are limited in what we can say . Back to you. I appreciate that it's frustrating for the committee, but we are bound by. legislation that governs the. investigation that they are. mounting for which they are responsible. So, you know, we cannot .
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Speaker 1
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Speaker 1
Are you able to give us a time frame when you are able to tell us or not? I think that's for the HRC rather than for us. Can I just say something on civil service pensions just because you've raised it? And I think it is really, really, really. important that our staff hear from us today about just how seriously we take this. It is a Cabinet Office. project and a Cabinet Office run service. Only in the last week, I've. spoken a couple of times to the second permanent secretary who's taken over the new agency that Will is looking after this issue, and it's been discussed amongst heads of department because we recognise how serious it is.
I am really clear that it is not good enough at all that people who have worked for. DWP for years and years are unable to access their pensions. I am not surprised that they have been raising this with Members of.
I am really clear that it is not good enough at all that people who have worked for. DWP for years and years are unable to access their pensions. I am not surprised that they have been raising this with Members of.
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Speaker 1
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Speaker 1
And we are obviously very worried about the hardship that some of them have been facing. We have, of course. provided hardship loans, but we recognise that isn't really a replacement for having the money that you're entitled to in your pension. So we continue to lend all the resources that we can to the Cabinet Office in trying to rectify the. situation and offer all of the expertise that we can in trying to rectify it and to ensure that it remains a key.
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John Milne
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John Milne
10:09
Speaker 1
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Speaker 1
How will you ensure that this won't happen again? I think it's really excellent question and a really good example of what I was talking about earlier, of a sort of culture of kind of being open to listening to , to issues and challenges. One of the things that I really reflected on in reading the Grenfell Tower inquiry report as the permanent Secretary and Mhclg, was that it was very, very clear that the issues with building. regulations were well known and understood elsewhere , and that they were being raised. consistently with the department over a. substantial period of time.
I think it was it was a situation in which we did not there was a culture of explaining why the department was right, rather than a culture of listening to, to what might be going wrong underneath it all. And it is obviously true that there was also appalling behaviour by a whole series of other players in that arena. But nonetheless, the inquiry report is very, very clear that we should have taken that more seriously. And I think that is about kind of questioning. Whenever we receive a set of complaints or issues raised with us, what actually is going on underneath the surface of this, because it obviously shouldn't necessarily need an external review in order to determine that.
So I think that would be my sort of first kind of critical lesson, is that you just always need to ask yourself what would happen, like what might be going on here that we haven't quite got to the bottom of and not wanting to get to the stage of having to ask an external reviewer to do it. Now we can do that partly by tracking complaints. I think it's also about how we engage with stakeholders. I was fortunate enough to go to carers UK as one of the first visits that I did as permanent Secretary, and I'm really grateful for them for spending time talking to me about these issues, making sure I obviously knew about the carers allowance issue before I became permanent secretary here, but I obviously didn't hadn't got under the skin of it to the extent that I obviously need to now.
And indeed, I'm really grateful to the carers who gave up their time to come and talk to me about their.
I think it was it was a situation in which we did not there was a culture of explaining why the department was right, rather than a culture of listening to, to what might be going wrong underneath it all. And it is obviously true that there was also appalling behaviour by a whole series of other players in that arena. But nonetheless, the inquiry report is very, very clear that we should have taken that more seriously. And I think that is about kind of questioning. Whenever we receive a set of complaints or issues raised with us, what actually is going on underneath the surface of this, because it obviously shouldn't necessarily need an external review in order to determine that.
So I think that would be my sort of first kind of critical lesson, is that you just always need to ask yourself what would happen, like what might be going on here that we haven't quite got to the bottom of and not wanting to get to the stage of having to ask an external reviewer to do it. Now we can do that partly by tracking complaints. I think it's also about how we engage with stakeholders. I was fortunate enough to go to carers UK as one of the first visits that I did as permanent Secretary, and I'm really grateful for them for spending time talking to me about these issues, making sure I obviously knew about the carers allowance issue before I became permanent secretary here, but I obviously didn't hadn't got under the skin of it to the extent that I obviously need to now.
And indeed, I'm really grateful to the carers who gave up their time to come and talk to me about their.
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Speaker 1
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Speaker 1
Because obviously there are sort of, as the budget showed, with the. introduction of a of a taper on carers allowance, there is the issue of fixing the overpayments, but there's also the kind of overall issue of fixing the some of the issues with the system in general. So I do think it's about it's about opening your ears to, to, to complaints, plotting patterns. And in fact, one of the things in our action plan on.
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John Milne
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John Milne
But it's also about it's about your stance, I think. Thank you. And I do think it needs a change in philosophy. I've come across it in other areas of government too. It's not an obsession with process. Rather than what is the actual problem that needs to be solved. But but moving on. So there's a big reassessment exercise going on with a target of. March 29th to complete. And now in the first six months, only 1% of cases have been reassessed. And I think it's been estimated it would take about 40 years if we carry on at the present rate to get through it.
So we're being told that it's ramping up.
So we're being told that it's ramping up.
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Speaker 1
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Speaker 1
It needs to ramp up quite significantly. Where where are we now? Yeah. I mean, actually, can I yeah, I mean, you know, I'm fond of process, as I've already made clear to the committee, but I accept it's also about about attitude. So I mean, on that, I, I sort of was obviously anticipating that you might ask about it because the latest sort of release that we did an update we did to the committee, set out that we'd reassessed just over. 2000 cases as of the 13th of September. You'll be pleased to hear we're not intending to continue at that rate.
And indeed, when we set up this exercise, we were clear all along that this would not be to do with. This would not be something where we were going to. We we were going to start slowly, and we were going to start slowly, deliberately. And we're going to start slowly, deliberately, because it is very, very important that we prioritise. accuracy and that we learn from the early reassessments that we do to ensure that we can ramp up safely and not introduce new inaccuracy into the system. So we have done that. We have employed extra people to be involved in the exercise.
We're now able to for them to have the benefit of the learning that we've done, and I can I can't give you a sort of. verified figure for how many we've now done, but I believe .
And indeed, when we set up this exercise, we were clear all along that this would not be to do with. This would not be something where we were going to. We we were going to start slowly, and we were going to start slowly, deliberately. And we're going to start slowly, deliberately, because it is very, very important that we prioritise. accuracy and that we learn from the early reassessments that we do to ensure that we can ramp up safely and not introduce new inaccuracy into the system. So we have done that. We have employed extra people to be involved in the exercise.
We're now able to for them to have the benefit of the learning that we've done, and I can I can't give you a sort of. verified figure for how many we've now done, but I believe .
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Speaker 4
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Speaker 4
As of today, we have. 2500 cases we're actively looking at. So, you know, when we wrote to you in September, we said we'd done. 2400 complete just this week. We're looking at 2500. It seems to be the bane of my life. This for the last 15 years, I've been trying to explain to committees that things are not linear. Okay, you start small, then you ramp up at the end. When I rolled out Universal Credit, I did. I did. 75% of the job centres in nine months. The last nine months. I spent the previous four years doing the first quarter.
So I learnt how not to make mistakes. And we're following that pattern with the Carer's Allowance review as well. I'm pleased with the progress we're making there and we're on. We're on track so you will see it ramp up. You know we've gone from zero staff doing this to 250.
So I learnt how not to make mistakes. And we're following that pattern with the Carer's Allowance review as well. I'm pleased with the progress we're making there and we're on. We're on track so you will see it ramp up. You know we've gone from zero staff doing this to 250.
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John Milne
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John Milne
That we expected it to start more slowly than it would go further down the line. Thank you. So it was a it was a big conclusion of the review that the majority of carriers, carers were not at fault for the overpayments. So the debts were accumulating because of administrative failures, and the department accepted that. Yet so far you've changed the outcome in only. 8.3% of cases, which seems .
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Speaker 1
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Speaker 1
I believe he was we were predicting that it would be around that percentage of cases that we ended up with overpayments. So actually, what is happening is consistent with the modelling we had at the beginning. And I think he explained it in quite a lot of detail when he was here. Why our modelling .
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Speaker 4
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Speaker 4
Suggested that it would be. around 10% ish just under. So we're doing two things here, and the two occasionally get. elided in some of the commentary about this. There was a problem with our averaging guidance. This is what that that that that exercise is about. We made a mistake. Our guidance did not conform to what the law required for averaging irregular earnings. It's actually quite a difficult process to do. I've sat with the teams doing it. Cranky is it's really difficult, which is why it's taking us a bit of time to skill people up to do this and get it right.
Then there's a second issue, which was we were receiving information. It's called Veps. It's a verification of earnings payment system. It tells us where there might be an overpayment on a case. We got Treasury funding back in. 2019 to only do half of those. Concentrate on the half with the biggest. overpayments that left. And what Liz complained about in her. report was that we were leaving half the cases. So we knew that there were overpayments, but we weren't doing anything with it. On that, we have doubled the number of staff working in in this area.
So we are now clearing all of those prompts to us. It's not stopping. overpayments occurring, but it is reducing the size of the overpayments because basically we're getting to them quicker. So it's two separate issues here we're working on. And, you know, and our our letter tried to split those two out for the .
Then there's a second issue, which was we were receiving information. It's called Veps. It's a verification of earnings payment system. It tells us where there might be an overpayment on a case. We got Treasury funding back in. 2019 to only do half of those. Concentrate on the half with the biggest. overpayments that left. And what Liz complained about in her. report was that we were leaving half the cases. So we knew that there were overpayments, but we weren't doing anything with it. On that, we have doubled the number of staff working in in this area.
So we are now clearing all of those prompts to us. It's not stopping. overpayments occurring, but it is reducing the size of the overpayments because basically we're getting to them quicker. So it's two separate issues here we're working on. And, you know, and our our letter tried to split those two out for the .
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John Milne
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John Milne
Committee so you could see that we're on both cases. Thank you for that explanation. In recommendation seven A of the review, again accepted by government was to ensure that the I, quote, ensure the presumption in Carer's Allowance is to apply a civil penalty only when justified. But in the. In the seven months after that. DWP issued over. 17,000 civil penalties, penalties for carer's allowance and that's about a third of all civil penalties issued by the DWP.
So why you're continuing to .
So why you're continuing to .
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Speaker 4
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Speaker 4
Find a very large number of carers. Why is that? So? I think we put this in our response in our six monthly update that Peter promised the committee. We looked at whether the civil penalties are being properly applied and they are. They meet the. criteria that. Parliament and ministers have set out for us to apply them. If anything, what our study unveiled was that we weren't properly applying them in other benefits. So it was looking like in Carer's Allowance that there was a higher. proportion in Carer's Allowance compared to the other benefits in the system, most notably Universal Credit.
So I used to be responsible for. So, you know, we're not wrongly applying these, you know, civil servants can only follow the policies set out by ministers and .
So I used to be responsible for. So, you know, we're not wrongly applying these, you know, civil servants can only follow the policies set out by ministers and .
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John Milne
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John Milne
The policy as Parliament intended. Thank you for that. Perhaps we need to reconsider the policy, but not for us. Yeah. Fair enough, fair enough. Yes. And then lastly, the minister set out the actions that the Department has taken to improve tenants allowance. When can we reasonably expect to have a fully. functioning .
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Speaker 4
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Speaker 4
Systems very, very quickly is not tends not to be very successful. I mean, if you want the fun fact on here, it's not really a fun fact, but the IT system that runs Carers Allowance is older than the our head of digital, I mean, it is. incapable of. adaptation to produce the taper. And Catherine, maybe you want to say a couple of words just about the policy development here,
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Speaker 6
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Speaker 6
We've got a bit of policy development to do as well. Yeah. Just to add to that, I mean, as Sarah says, we think it's really important for. modernisation of the policy that we introduced this taper. And lots of stakeholders and organisations are very supportive and pleased that we've been able to do that. And we are all frustrated and keen to get on and implement. But as Neil says, the systems are simply so old and take take that amount of change to them that it will be a few years. But we're also continuing to just look at the policy and .
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Speaker 1
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Speaker 1
Should the new system seek to address. So we I know that the committee was paying a very keen interest in the action plan when Peter appeared at a similar hearing this time last year, and we have set out a really. comprehensive plan to ensure that in future, nobody can remain unaware of changes in their own state pension age. I decided to try out the test your State Pension Age service the other day in order to test my own, and it worked very efficiently and very quickly. And the purpose of the plan is to set out a series of actions.
campaigns ongoing in order to ensure that people are aware that they should check their state pension age and aware of how they can do it. That includes paper channels as well as digital channels, but the digital channel is obviously kind of one which is most convenient for people. So since that was published, we promoted the Check Your State pension age. actively as a service in September during Pensions Awareness Week. And we are on track with all of the different actions that are set out in that action plan. We've also been keeping the Ombudsman updated on it, with the most recent discussion with the Ombudsman on it taking place only days ago.
So I am satisfied we are on track with the actions that we set out in June. You will have been able to see some of them making an impact as part of our. campaigns and, and we are continuing to .
campaigns ongoing in order to ensure that people are aware that they should check their state pension age and aware of how they can do it. That includes paper channels as well as digital channels, but the digital channel is obviously kind of one which is most convenient for people. So since that was published, we promoted the Check Your State pension age. actively as a service in September during Pensions Awareness Week. And we are on track with all of the different actions that are set out in that action plan. We've also been keeping the Ombudsman updated on it, with the most recent discussion with the Ombudsman on it taking place only days ago.
So I am satisfied we are on track with the actions that we set out in June. You will have been able to see some of them making an impact as part of our. campaigns and, and we are continuing to .
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Speaker 1
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Speaker 1
In actually achieving them? It's a very good question, I'm afraid. I'm not aware that we've set a specific target in terms of changing that number or the source of that. Very happy to sort of follow up with exactly what we're expecting in terms of awareness. But the plan has a really wide range of actions that we've set out in order to try and make a difference to this. I mean, you can , you can, you can sort of write to everybody. You can't force them to sort of engage with the things that you, you give them.
So there will always be a proportion of people who are not engaging with those services, but they are honestly so easy to engage with. I cannot tell you when I, I decided to check and my pension age is also is 67. So I'm not one of those 1 in 5 now,
So there will always be a proportion of people who are not engaging with those services, but they are honestly so easy to engage with. I cannot tell you when I, I decided to check and my pension age is also is 67. So I'm not one of those 1 in 5 now,
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Speaker 4
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Speaker 4
Which is obviously good news. But Neil, I was just going to say, well, my wife and I got our letters about three months ago because we are in the age range for the. change from 66 to 67. So we've sent millions of letters out now to people. But as some of the work around the Ombudsman found, when they looked at the WASPI issue, people have a very low. recall from letters.
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Speaker 1
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Speaker 1
Suspect there still will be people who will not take account of this, and we will try. And it's the multi-channel nature is really important, and obviously that we target it to that the particular. population that needs to know, which is why we will have chosen these channels quite carefully and why we amplified it during a moment where people would be thinking about their .
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Liz Twist
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Liz Twist
Anyway, in September during Pension Awareness Week. Yeah, I want to come on to some of those people who might not. access or hear through usual means. So because your research also found that. vulnerable awareness was lowest amongst the more vulnerable, financially vulnerable groups, what do you think are the main. barriers to those .
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Speaker 1
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Speaker 1
Think there are specific measures that need to be taken to keep those, as I say, kind of. We've agreed this plan with the Ombudsman. The Ombudsman was satisfied with it and with our progress on it, and it does involve writing to. everyone and using a lot of different. channels in order to try to communicate.
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Liz Twist
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Liz Twist
Thank you. I'd like to talk now about. inflated state pension forecasts which are may have happened. So on more than one occasion now significant numbers of people have been affected by. inaccuracies arising from the interaction between. DWP and HMRC systems and records. And I know that you've mentioned a number of you mentioned the kind of old computer systems and programs that you have, which is featuring in a lot of these issues. But are you confident that the governance arrangements between the two. departments are now. sufficient to. identify and resolve issues before they affect customers? And if so, why?
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Speaker 4
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Speaker 4
I'm not saying not me, guv, but it really wasn't the Department for Work and Pensions or anything that we had inputted. It was a question about how the. forecasting system that HMRC run was set up and the inputs that they were making from the National Insurance System into that. And we don't run the National Insurance system we haven't done since.
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Speaker 4
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Speaker 4
One of the reasons why the. department pulls out from the horizon thing early on, something Harriet Harman and Alistair Darling did was our. experience working with the predecessor to Fujitsu, who were running the then National Insurance Recording System, and we saw the problems that were created in the National Insurance Recording System. So, you know, back to my questions earlier, some of these problems go back decades. Okay. And I think that was what was going on here.
But what we have done be more positive here is we have shared governance. arrangements between the two .
But what we have done be more positive here is we have shared governance. arrangements between the two .
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Speaker 4
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Speaker 4
And then my. directors sit with HMRC. directors working on issues that where there's the overlap between the national recording of National. Insurance and entitlement to benefits, most notably for the retirement pension, but of course the Employment Support Allowance or Jobseeker's Allowance. The contributory versions of those are dependent on HMRC holding the records properly and and updating them. And if you want a good example of that, the home at home.
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Speaker 4
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Speaker 4
In the annual report and accounts. It's it's listed there. That was activity where we planned with. HMRC there for their actions to. contact women who may have been able to qualify for extra contributory years through HRP and and that had been missed on HMRC systems. So we were ready to take the. cases when they corrected the National Insurance records to come back to us to.
recalculate pension entitlements. So we work quite closely with them.
recalculate pension entitlements. So we work quite closely with them.
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Speaker 5
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Speaker 5
Just the. forecasting issue really wasn't us. Gov, can I perhaps just add about you asked about assurance. Yeah. So following that there's a couple of pieces of work that we did jointly with HMRC. So they now provide us with an annual letter of. assurance about the. processes for maintaining. accurate national insurance records. And we talk about that in our governance statement in the annual report and accounts. And we also have a regular programme of internal audit work where they follow up the. actions that were agreed as a part of the review that was done jointly across.
DWP .
DWP .
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Speaker 4
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Speaker 4
National Insurance. credits correctly into HMRC. Basically, their older systems couldn't cope with the new data that was coming in, so we had to correct our end to make sure that that worked. And everybody's national insurance records who are on Universal Credit in the past or Universal Credit now are now up to date because of that. So we've got issues between the two of us, which is why I say we have this joint. meetings to make sure that we, you know, resolve issues as they emerge. I'm sure new issues will emerge of some sort or another.
And as Catherine was saying, the concordat, the governance arrangements are .
And as Catherine was saying, the concordat, the governance arrangements are .
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Speaker 4
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Speaker 4
People were affected and the extent of the forecast? As I say, I don't think any of us can answer that question , because the. forecasts are the. responsibility of HMRC, and it was their estimates of the level of problem they had with their sort of coding. I think it's a lot smaller than that, but these are .
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Speaker 1
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Speaker 1
And I think to make things that should be easy. Yeah. Well I mean I wish they were easy, I think I fear they're not quite as easy as they might sort of sound from the outside. And that is certainly something I am learning during my time at DWP. That they're not. straightforward are actually quite complex. But I think the answer that Catherine gave you earlier, which was about kind of exactly how we provide ourselves with assurance going.
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Speaker 1
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Speaker 1
The way we manage the relationship with HMRC. I know JP marks very, very, very well and kind of have a very strong relationship with him. So did Peter. I'm sure we're going to kind of maintain that going. forward and ensure that that assurance is, is can be given in, in future. But obviously, we also .
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Debbie Abrahams
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Debbie Abrahams
Can't take. responsibility for things that they they run. Thank you. Liz, thanks so much. I'm going to quickly ask you a question on following up on on the letter, particularly that we received. yesterday afternoon from Sir Stephen on, on safeguarding. We are we do need to to speed up in our responses. If I could ask you for for for pithy responses, that would be great.
So first of all, thank you for your early.
So first of all, thank you for your early.
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Speaker 4
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Speaker 4
The level one safeguarding training. And how many out of how many? Well, we haven't said it's going to be everybody in the department. No, I'm saying how many are about 16,000. Of those, roughly. 16,000 are front. facing staff, as you as you described in your question. But I would ask the committee to remember as well that we also we have a slightly different definition around what safeguarding is. I know you use it to throw across vulnerability. We have separate vulnerability training that everybody has done in the department. So our safeguarding training is about referring people on to experts.
So for example, domestic violence, you wouldn't want us trying to deal with domestic violence in a job centre. But when we identify somebody who's at risk of this, that's where the safeguarding training cuts in. That's when we refer to our partners in local. authorities to, to, to deal with that. But so I just want the committee to know everybody has had training in dealing with vulnerable. customers and those circumstances. And the safeguarding training is on top of that.
16,000 frontline .
So for example, domestic violence, you wouldn't want us trying to deal with domestic violence in a job centre. But when we identify somebody who's at risk of this, that's where the safeguarding training cuts in. That's when we refer to our partners in local. authorities to, to, to deal with that. But so I just want the committee to know everybody has had training in dealing with vulnerable. customers and those circumstances. And the safeguarding training is on top of that.
16,000 frontline .
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Debbie Abrahams
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Debbie Abrahams
Do that, but instead to identify under the other category. And I think it was I just say this. November is elimination of violence against women and girls. Two women a week will die at the hands of their partner or ex-partner. I if we are to monitor it. We had people who were affected by domestic abuse where money, being able to leave their abusive. partner was absolutely. vital and they they felt.
completely lost. I have to say, in terms of how they could access. support from.
completely lost. I have to say, in terms of how they could access. support from.
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Speaker 1
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Speaker 1
May be vulnerable in this way? There is a there is a reason here. I'm sure there is a reason, and I will pass, pass, pass to you to, to to expand on it. On it. Neil, I please don't think that we are not mindful of. And that our staff who actually are in many cases the only face to face service that the government has,
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Debbie Abrahams
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Debbie Abrahams
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Speaker 1
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Speaker 1
Domestic abuse, surely we want to know about it so that we can make available. All I was saying was, please don't take the response to that particular question as an indication that we don't take violence against women and girls seriously, and that kind of the people who engage with our customers kind .
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Speaker 4
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Speaker 4
Of don't come across these cases and deal with them very regularly. Neil. So some of the and the committee will know this much better than me. But some of the instances where domestic violence is an issue, the relationship has not yet broken down. The woman in it's nearly always the case has not yet fled the home. The UC. system is. accessible to both .
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Speaker 4
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Speaker 4
One name person. Instead of allowing there to be two separate people. Yeah, that that that's the payment issue. The question you asked us was about the. recording of this in the recording. There is a risk , and in a design sense, we took a decision to. minimise the risk here of inadvertent disclosure, which is what Sir Stephen's letter says. Back to you. If you are now raising an issue about the alternative payment arrangements, that is a separate issue, and I'll .
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Debbie Abrahams
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Debbie Abrahams
Be happy to respond to you on on that and what we do in those circumstances. I'm thinking what I'm saying, Neil, is that if there had been an automatic right for APA, there wouldn't be one person and then that one person, that abusive person, wouldn't know if somebody was trying to leave them. So let's leave it. Let's leave it there.
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Peter Bedford
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Peter Bedford
And I'm going to hand over to Peter Bedford. Thank you. Chair. Turning now to fraud and error. So in the annual report and accounts, just in summary, you had overpayments of. 9.9 billion in year. 2526 with underpayments of 1.2 billion. So net overpayments of 8.7 billion. Now, the government last year tried to put through the most modest of welfare savings to save just 1 billion.
But we've got multiple times that that's basically being wasted in the system due to fraud or error. And what are you doing .
But we've got multiple times that that's basically being wasted in the system due to fraud or error. And what are you doing .
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Speaker 1
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Speaker 1
And we are very. focused on doing everything that we possibly can to reduce the level of fraud and error in the system, and indeed have seen significant amounts being saved through a series of interventions, not least targeted case reviews. In recent years, we have been clear that we want to get the level of fraud and error down to 2.8%. That would be the lowest level it has been since the introduction of tax credits in. 2003 four, and is therefore.
And it is currently down at.
And it is currently down at.
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Speaker 1
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Speaker 1
And we are working towards implementing other aspects of the act which are not yet implemented, such as entry, search and seizure. I'd also point you to some announcements in the budget with regard to fraud and error, which. include expanding of the network of verification assurance. officers in Jobcentres.
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Speaker 1
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Speaker 1
While we would very much like to bring fraud and error levels down even lower than that, there are just some fundamental challenges with the nature of a highly targeted benefit system in doing this, that if you look at something like the state pension, for instance, our fraud and error rates are incredibly low, well under.
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Peter Bedford
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Peter Bedford
It is very, very challenging to get down to those kinds of levels in other areas. Those measures you just listed off so early in the year, I think the Public Accounts Committee made clear they it was unclear how you were going to spend the. £2 billion that was allocated for this. Is that the stuff you just reeled off?
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Speaker 1
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Speaker 1
So 1 in 4 on Pension Credit with 1 in 3 is incorrectly. So if you take the state pension. It basically asks two questions. Okay. Have you paid national insurance. Are you over pension age. I mean there is some about residents, but just just for the point of my argument, just take two questions. Universal credit asks.
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Speaker 1
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Speaker 1
Okay. So any one of those could have some error or fraud in them. So the way the state pension works is almost like a universal basic income. It's paid to every citizen basically, because it's not actually you've paid national insurance. Now the contribute the sort of credit system we were touching on a bit of this in earlier questions. extends that. So it works like a universal basic income has a very low level of of error. So if you wanted to take universal credit and make it a universal basic income, you would get rid of about.
7 or £8 billion worth of fraud and error, but it will cost you about anything from. 400 to 800 billion to run such a system. So I'd save the Exchequer.
7 or £8 billion worth of fraud and error, but it will cost you about anything from. 400 to 800 billion to run such a system. So I'd save the Exchequer.
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Peter Bedford
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Peter Bedford
Example of, you know, your. complexity reduces expense complexity. Just on your point. around the complexity of the universal credit forms and filling in when we consider error or fraud, the fact that some of these benefits are extremely complex and the forms and the, you know, what's what's required is extremely complex. How do we distinguish between what's a genuine error? You know, someone's confused when they're filling in a form and .
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Speaker 1
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Speaker 1
Willfully trying to game the system. What we discover about what their actual. circumstances are. So in the in the annual report and accounts, it says about. three quarters is fraud of some sort. Of the of the total but doesn't go going going back to this point because I think, you know, it's not. complexity because we want to be complex. It's the it's it's how you target something on, on, on individuals. If you take the rule around having a partner. So the couple's rules. Okay. There's about. £1 billion worth of fraud caused by people not being straight with us that they're in relationships.
Okay. Having a couple rule saves you. £40 billion because otherwise, if you individualize the benefit. So am I bad for having. £1 billion fraud and error? Or am I good for saving the Exchequer. £40 billion by not having an individualised system? And that's what's going on here, which is why it is very difficult to reduce fraud and error in the big income related benefits below 3%.
Okay. Having a couple rule saves you. £40 billion because otherwise, if you individualize the benefit. So am I bad for having. £1 billion fraud and error? Or am I good for saving the Exchequer. £40 billion by not having an individualised system? And that's what's going on here, which is why it is very difficult to reduce fraud and error in the big income related benefits below 3%.
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Speaker 2
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Speaker 2
I think the. 2.8% target is. extremely stretching. I think it's worth saying you mentioned pension credit and two of the biggest drivers of fraud and error in Pension Credit is to do with people not letting us know how long they've been abroad for, and to do with. fluctuations in the amount of capital that they have and not declaring those promptly. And two of the measures that .
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Speaker 2
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Speaker 2
Authority from the Cabinet Office to the DWP will actually have. Well, I actually think that, number one, the decision to. Machinery of government change the Sjfa over to DWP is a vote of. confidence in our. expertise on fraud. We obviously want, as we do with a range of other services that we are responsible for, such as the Health and Safety Executive, to ensure that they still maintain their. independence in challenging us to be better on on fraud. But I think it puts them closer to. understanding what implementing systems to address fraud and error are. And therefore, we hope that that will enable them to have an even bigger impact on the advice .
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John Milne
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John Milne
Public authorities. Okay. Thank you chair. Thank you. John Milne Thank you, chair. And I'm conscious a bit tight on time. So just to say, but continuing on on a similar theme. So errors directly by the. government caused about. 1.1 billion of overpayments, 1.2 of underpayments. That's quite a substantial sum of money. Maybe not in the greater scheme of DWP, but it's.
So what what what do we think we can do to can can we reasonably .
So what what what do we think we can do to can can we reasonably .
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Speaker 1
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Speaker 1
Reduce those figures? So they are very small. You know, they're like 0.4%. This is official error. overpayments by volume of expenditure. So there is already quite small. And I have had Mr. Bedford raised this some exchanges of the Public Accounts Committee on this to say, if I put effort into official error, I might not be able to put it into fraud. So and if I reduce official error by a quarter, I'd only see. 0.1% come off our fraud and error loss. If I reduce fraud by a quarter, I'd be closer to, you know, half a percent coming off of that figure.
So we are not we we invest in quality. We train our staff. We do quality checks to try and lift the level of official error. But I do not think it would be cost effective to do more today than we already do, because I think there is more for the. Exchequer and the taxpayer. I can get back by honing in on the losses we're seeing on fraud and .
So we are not we we invest in quality. We train our staff. We do quality checks to try and lift the level of official error. But I do not think it would be cost effective to do more today than we already do, because I think there is more for the. Exchequer and the taxpayer. I can get back by honing in on the losses we're seeing on fraud and .
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Speaker 2
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Speaker 2
In that in that way. I appreciate that. I think in terms of improving public perception, but I think also in terms of the action that we're taking, quite a lot of it will be similar with both. If we think about the issue over kind of making it clear, easy for somebody to declare where they are, whether they're abroad or not. That helps because it reduces the error and allows us to hone down on on where it's fraud. So, I mean, you know, I think I think actually it might make it more. complicated rather than us actually thinking about how we can upfront kind of do as much as possible to prevent fraud and error in how we set up our .
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Speaker 1
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Speaker 1
Than fraud. So that's what HMRC, the word that people hear is fraud. Yeah. So HMRC characterizes everything as error in their side of things. In fact they call it error and fraud. They've swapped swapped the two around because fraud is. three quarters of the error of loss. We call it fraud and error. But you know that's that's a choice. No doubt people can make. I just would say in the statistics we do break all this down for everybody.
So you .
So you .
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John Milne
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John Milne
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Speaker 2
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Speaker 2
That or I think sorry. I was on a roll Neil. Yeah, I was just going to say a couple of things then obviously you'll want to add some extra detail. Neal. All I was going to say is kind of where it comes to underpayment. I mean, we've already mentioned quite a lot of the things that we've. changed that will help to address some of this, not least strengthening the use of evidence, making it easier for people to update us on what their. circumstances are. TCR actually targeted case review is there kind of to identify error as, as, as Neil said, it will identify underpayment as well as overpayment.
And that is a .
And that is a .
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Speaker 1
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Speaker 1
Helpful mechanism that we use to do that and one which we're obviously expanding. Yeah. Before I rudely interrupted my permanent secretary and ruin the career once more. I was just going to say the committee has made some really good points. previously about confidence in the DWP. So the heart at the heart of the unfulfilled. eligibility numbers, which is the. 3.7 you're talking to, Mr. Mitchell, is a lack of confidence that if I tell the DWP something, my benefit will go down when it should go up. And you can see in the DLA figures. particularly where there's nearly a quarter of expenditure, there is unfulfilled eligibility.
It is fear from existing claimants contacting the department that stopping them telling us things that have changed on their case, that were given them a bigger award. So the committee before has said to us, you know, you need to take this confidence in you issue. seriously .
It is fear from existing claimants contacting the department that stopping them telling us things that have changed on their case, that were given them a bigger award. So the committee before has said to us, you know, you need to take this confidence in you issue. seriously .
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Speaker 2
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Speaker 2
The heart of the unfulfilled. eligibility thing here. And just to sort of add to that, you will have seen that this is another area where we're using. communications in order to encourage people to tell us about updates and circumstances. And that is from the perspective, both of encouraging people not to fail to tell us of changes in.
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Speaker 2
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Speaker 2
To error itself? And how are you making sure you're not going to make things worse? So we will use I mean, broadly, we will use technology whenever technology is available that is reliable. In order for us to do this, we actually have tried and tested ways of identifying fraud and error, which are quite resource heavy. And we're very aware that it would be good if we were able to streamline those in future and use more. technological means in order to do this and not rely on such a resource heavy approach to it. Clearly, as you say, technology can make.
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Patrick Hurley
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Patrick Hurley
Being used against us as well. Yeah. I don't know if you were coming on to that, but I'll come on to that now actually, because how were you firstly going to make sure that the DWP systems aren't going to be the front line in some sort of hybrid warfare from the Kremlin. And, you know, we we're we're seeing supermarket fridges being .
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Speaker 2
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Speaker 2
As well as dealing with fraud and error, or is that just further down the track? So I'll say a few things about actually what I will do is turn to Catherine on cyber security, because. clearly the security of DWP systems is absolutely paramount. The amount of personal information that we have, the amount of money that is flowing through our systems, it is really, you know, as we've all reflected during this meeting, an incredibly high sum. And so our.
cybersecurity and resilience measures are critical. And one of the .
cybersecurity and resilience measures are critical. And one of the .
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Debbie Abrahams
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Debbie Abrahams
Things that definitely keeps a new permanent secretary awake very briefly, if you could, Catherine. Thank you. Thank you. Yes. So it is part of my. responsibility to look about our enterprise security risk management as a whole. So that is about thinking partly about cyber security risk, but also how it. interplays with personnel.
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Speaker 2
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Speaker 2
Kind of we use it to support human. decision making. And we, we. And, and that is the purpose of it. We are very transparent about where we use algorithmic tools in the work that we do as we should be. And we do a lot. The department is actually quite mature in having had a sort of responsible AI framework and approach for some time, but it is also really, really, really important to my mind that we make the best possible use of technology where we can to make both the customer experience better and our staff's lives easier.
And I won't because of time. List all of the different ways in which we're using AI at the moment, but it's a range of different ways.
And I won't because of time. List all of the different ways in which we're using AI at the moment, but it's a range of different ways.
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Patrick Hurley
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Patrick Hurley
In order to improve both customer and staff experience. So briefly, on a different topic, if I can pension credit, the take up of pension Credit is flatlining at around two thirds over the last few years, despite pretty much all of the publicity measures that you're trying to get out there to encourage take up. So what are you going to do .
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Speaker 2
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Speaker 2
Different this time around to encourage more people to take up pension credit? I mean, we've got an incredibly active campaign out there at the moment, which we are rolling out in phases in order to encourage the take up of pension Credit, and we will continue to implement that with energy, and we will .
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Speaker 1
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Speaker 1
Which is the first time it's nudged up. Its working against an uphill path. because as the state pension is rising fast now under the triple lock, it's. accelerating away from the pension credit entitlement. And that is reducing the number of people who would be entitled. That is a policy choice that the .
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Rushanara Ali
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Rushanara Ali
Thank you. Thank you chair. Thank you. Thank you. So I've got a couple of questions on health transformation and Pip. The Pip customer experience in 2025. 26 the department processed 82.2% of new Pip claims in a timely manner, and that's up from 62.4% from 2024 to 5, which looks very positive and encouraging. But the the downside is that you've increased the measure of timeliness from processing a new claim from 75 days to 120 days. Can you talk us through why you think that's acceptable in terms of the shift in goalposts, where it will take six months for the processing of a disability benefit you can appreciate, like if if we had to wait for something quite straightforward for .
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Speaker 1
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Speaker 1
And I'd be hitting that target and you'd all be saying, oh, well done, you're hitting that, that, that target. So I set a 90% target across all the all the major. benefits in my areas Carer's Allowance, Attendance allowance, DLA child all got 90% targets because you can't game a 90% target. I'm an old operator here. I know how to how to sort these systems out. So it wasn't about moving the goalposts.
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Rushanara Ali
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Rushanara Ali
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Speaker 1
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Speaker 1
In the. process because of this vulnerability. So the chunk of the time is taken up in the assessment process and trying to make sure that we don't rush to an assessment, because when we found we did that and the chair's rightly called out, you know, IPS and the like in the past, and we found out the IPS that people were rushing for the performance. targets to close people's claims inappropriately.
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Rushanara Ali
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Rushanara Ali
That's right. What we do to respond to particular circumstances. Yes. That's right. Because those are the cases that can be very serious and can find their way to a committee and MPs raising it with ministers, because there's nowhere else to go. And we just need to make sure that we're really clear that this six month, this extension doesn't have detrimental effects on those .
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Speaker 1
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Speaker 1
Who are likely to suffer in these circumstances, vulnerable people will need more time. Okay. That's what we've allowed for in the target to try and get the right culture in the department. Other cases do go quicker than that. I'm also building lots of. capacity in the assessment bit of the. process so that they .
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Peter Bedford
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Peter Bedford
Thank you very much, Peter Bedford. Thank you. Chair. Turning to service modernisation. You touched on it a bit earlier on your four years into an 11 year programme on this. And you mentioned some of the challenges such as legacy IT systems and processes, etc. clearly outdated processes and systems here. But what are you going to do to ensure that actually, by the end of the 11 year period, the stuff you're bringing in isn't actually outdated technologies. Technology is moving on fast, right? And, you know, a few years time, the stuff you're bringing in could be completely archaic.
So what are you doing to ensure that we're the department .
So what are you doing to ensure that we're the department .
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Speaker 2
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Speaker 2
Is abreast at risk and is adapting the programme accordingly? Yeah, I mean, service modernisation programme is made up of lots of separate programmes. So it isn't just sort of one big thing, which I think really helps with this. And also the fact that we have such extensive experience with the failings and challenges of legacy systems that wherever possible, we are building in the ability to. update and develop our systems as we .
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Debbie Abrahams
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Debbie Abrahams
Procure them. But I can see that Catherine would like to say something about the commercial process here. Well, I think it's the now, I've recently done a really helpful study on. innovation in. DWP and. recognise that there are a whole range of ways in which we need to keep up to date , a range of ways of.
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Debbie Abrahams
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Debbie Abrahams
That we that we lean on, many of which we are trying to develop in more modular ways so that they are more flexible for the future. Because actually, one of the challenges we've already talked about today is how long it can take to adjust old systems. So when we are developing new. systems through the service modernisation programme. building systems in a way that enables them to .
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Peter Bedford
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Peter Bedford
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Peter Bedford
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Peter Bedford
Has done an enormous amount of work with octopus in understanding that and how it. And Kraken was a really good piece of innovation. And now a lot of other companies are starting to use it because of its just the functionality, the interface, customer service, all the rest of it. What kind of stuff is the .
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Speaker 2
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Speaker 2
Department doing to engage with the commercial sector to. Well, I mean, that is a really good example of some very intensive engagement with the commercial sector and understanding what is the cutting edge of. innovation and what we might be able to learn from it. And I know a lot of in-depth work was done with them on that. We will always look for the best examples that we can take from the commercial sector, but I think we also need to acknowledge that there are also things that we can learn from benefit systems in different parts of the world, which actually will tell us things as well, because we need to recognise the unique nature of what we do in our systems, because they need to be.
The level of reliability .
The level of reliability .
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Peter Bedford
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Peter Bedford
Banks can say, I don't want your customers. You can go somewhere else. We can't do that. Yeah, just just just just just briefly. I'm really keen on KPIs and holding . departments to account. You know, if you were to come back in three years time, what progress? You know, tangible progress are you going to .
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Speaker 2
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Speaker 2
Has been a success so far? So I would be extremely foolish in somebody who was only in their first select committee. If I set out for you a load of very specific KPIs right now, before we've been through the publication of Milburn, the publication of Tim's set out the next phase of our reform of the Jobs and Careers.
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Speaker 2
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Speaker 2
Seeing what is going to be required of the Department through devolution, got a spending review settlement that would not be sensible. Having said that, I would like to say that whenever we have set these performance targets, the annual report and account is report and accounts is where we set out the targets that the department holds itself to account for. What I can tell you is that from my. Everything that I have done in the past and that I know I would be obviously looking for the department to. respond to the challenge, that I think we will be set by the reviews that are coming out in the coming weeks.
In terms of reforming our services and seeing a real impact on the rate of of those not in education, employment and training, because it is such a priority for the government, a particular priority for our Secretary of State would have.
In terms of reforming our services and seeing a real impact on the rate of of those not in education, employment and training, because it is such a priority for the government, a particular priority for our Secretary of State would have.
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Damien Egan
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Damien Egan
Moving on, if I may. Damian. Thank you very much, chair. So I've got some questions on the new Jobs and Career service. So it launched at the beginning of the beginning of October, as you call it, a soft launch, because I know there's more to more to come. I wanted to to think from a customer or a claimant coming to a job.
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Speaker 2
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Speaker 2
What might they expect? I can say a couple of things and then ask Catherine to come in. I mean, one practical difference is obviously the absorption of the National Careers Service into the Jobs and Careers Service means there's a broader range of careers advice as well as as well as broad sort of advice on how to get into work available. And the use of that has been really positive. And job centers that I visited, they can point to the real benefit that they get from having careers. advisors as part of the job centre, with their sort of particular insight into employment and links between IT and skills offers.
And then the other thing I'd say in terms of what you can see, obviously, we've been rolling this out via a set of.
And then the other thing I'd say in terms of what you can see, obviously, we've been rolling this out via a set of.
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Speaker 2
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Speaker 2
And if you haven't been to visit one of those, it's very much worth it. It's not just the signage that is different, it's the layout. We've really been testing different layouts so that there a more positive environment for people to engage with, with a focus on privacy, listening to feedback from the people who work in the job centres, from work coaches about what is effective and giving it a much more sort of modern feel in those places in order to make .
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Rushanara Ali
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Rushanara Ali
Job centres open for all. But Catherine, do you want to say a bit more? Yeah, thanks. I mean, I think underpinning this is obviously we do want to get the evidence right for how we do transform and modernize the service. So as Sarah referred to, we've got this series of Pathfinders and some I know some of you have visited some of them. We've also got some longer term trials about frequency of our interactions with customers and also the channel through which we communicate. So whether it's face to face video, telephone, and we'll be publishing some of that evidence very soon.
So we want to use that evidence to test and learn and then reform the job centres. But in terms of what we've seen already, to add to what Sarah said, I mean, the other thing that we've got now is digital tools for our customers. So we've introduced an AI chatbot, which in fact, any member of the public can use at all who is looking for work or looking to progress in their careers. And also a CV builder, because we found actually with the careers advisers, actually their main use was really to advise people on CVS.
And if you can do that electronically, then we can make sure careers advisors are adding even more value in their interactions, their face to face. But I mean, I'm pleased to say that there's been a smooth integration of the careers advisers. They're already doing lots of face to face appointments, lots of telephone calls. So we are seeing we are seeing that integration. The other thing that customers are noticing as well is more outreach. So lots of our work coaches based in libraries, community centres, youth hubs, we've got vans that go driving around local communities as well.
So it's not just .
So we want to use that evidence to test and learn and then reform the job centres. But in terms of what we've seen already, to add to what Sarah said, I mean, the other thing that we've got now is digital tools for our customers. So we've introduced an AI chatbot, which in fact, any member of the public can use at all who is looking for work or looking to progress in their careers. And also a CV builder, because we found actually with the careers advisers, actually their main use was really to advise people on CVS.
And if you can do that electronically, then we can make sure careers advisors are adding even more value in their interactions, their face to face. But I mean, I'm pleased to say that there's been a smooth integration of the careers advisers. They're already doing lots of face to face appointments, lots of telephone calls. So we are seeing we are seeing that integration. The other thing that customers are noticing as well is more outreach. So lots of our work coaches based in libraries, community centres, youth hubs, we've got vans that go driving around local communities as well.
So it's not just .
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Damien Egan
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Damien Egan
About what you see in the Jobcentre, it's what you see out in the local community. I'm excited about this element around the focus around careers advice. One bit we talked to a number of questions. AI and changes in digital and tech has has come up. And obviously one one place is in the workplace. And I've worked with. constituents who've been in always worked and then found that after.
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Damien Egan
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Damien Egan
Have meant that they've had to go to to the job centre. We've had also been on visits as a committee to and heard. It won't surprise you that sometimes people feed back to us, that the support they get can be a bit one size fits all. So I imagine the careers, service and careers advice is trying to trying to do that, but could you speak.
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Damien Egan
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Damien Egan
Worried about those people who have been in employment for a very long time, and then the level of support. doesn't doesn't match. And it's probably one for you, Catherine, because it's a policy question. Something that came up with my work coaches is something at the moment called a four week permitted period, where people can go in and spend that time trying to find a job in their sector. But after that, the. expectation is that they look at more.
broadly and just feedback that I've had from from customers and from work coaches, is that four week permitted period in the world of work that we're in now,
broadly and just feedback that I've had from from customers and from work coaches, is that four week permitted period in the world of work that we're in now,
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Rushanara Ali
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Rushanara Ali
People need more time. Just would appreciate some reflections on that. On that. Yeah. And as you say, the economy and the labour market is changing really rapidly. And we obviously need to make sure our services are keeping up to date with that and are responding to that. On the impact of AI more generally. I mean, what we are seeing in the economy is that it's actually changing the nature of work as much, you know, the types of jobs that people do and how that's augmented by technology. So people both need upskilling in their current jobs and careers and with Skills England that we are also now responsible for, they're rolling out a programme of AI upskilling.
I think there's 10 million places. So it's a huge kind of national scheme for that, as well as short courses and things for apprenticeships. So there's upskilling available for people whose jobs need to be augmented. But in our job centres we're obviously offering services across a whole whole range of needs. In terms of people who are becoming detached from the labour market. We don't forget we've got the contracted employment service as well, which will be devolving some of that. So that works in partnership with our job centres, but we've got a whole range of support available depending on how close you are or how detached from the labour market on the four week permitted period in particular.
I mean, really happy to reflect and have a look on that. It has has been raised. It's a judgment, really, because obviously within the system of benefit receipt, we want to make sure that people are actually looking for work and are, you know, living by the .
I think there's 10 million places. So it's a huge kind of national scheme for that, as well as short courses and things for apprenticeships. So there's upskilling available for people whose jobs need to be augmented. But in our job centres we're obviously offering services across a whole whole range of needs. In terms of people who are becoming detached from the labour market. We don't forget we've got the contracted employment service as well, which will be devolving some of that. So that works in partnership with our job centres, but we've got a whole range of support available depending on how close you are or how detached from the labour market on the four week permitted period in particular.
I mean, really happy to reflect and have a look on that. It has has been raised. It's a judgment, really, because obviously within the system of benefit receipt, we want to make sure that people are actually looking for work and are, you know, living by the .
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Rushanara Ali
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Rushanara Ali
I just wondered if there are thoughts about how need will be defined. Yeah. I mean, the whole concept of the jobs and careers service so that it's more personalised, it's more flexible, as we referred to today, but it's more focused on need. So for example, what we're finding in our job centres is a lot of our work coach time is spent with people who are unemployed and less work. Coach time is spent with people who are inactive, for example. So people who are on health and disability benefits. We've tried some voluntary experiments in job centres, which has been really successful about offering a greater level of service to those people who are inactive and on health and disability benefits, and we're finding some really positive in work results from that.
So it's that sort of thing reflecting, as you know, we've got a big trend in the economy of inactivity, not just for young people but for older people as well. So trying to personalise and actually redouble our efforts on, on groups that we might not have spent so much time with in the past.
So it's that sort of thing reflecting, as you know, we've got a big trend in the economy of inactivity, not just for young people but for older people as well. So trying to personalise and actually redouble our efforts on, on groups that we might not have spent so much time with in the past.
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