On Benefit Fraud

Now then.  Dave Osler has an interesting post about benefit fraud over at Liberal Conspiracy.  Apparently, only 1% of benefits paid by the state are wrongly claimed.  That still amounts to a billion pounds, but is obviously less than the billions spent on bank bailouts.

Crucially, it is also much less than the amount of benefits people are legally entitled to, but never actually claim (approximately £10.5 billion, points out woodscolt in the comments).  Double crucially, it is a fraction of the money lost to tax evasion (£30 billion).  Yet in our political discourse, it is benefit cheats who are blamed for the horrible amounts of money the government wastes.  Could this be because diddling benefits is a poor person’s game, while tax evasion is a middle- and upper-class pursuit?

During the election campaign, I recall more than one political debate I had with friends and passers-by, on this problem.  Like immigration, the issue is incredibly muddled.  People often equate benefit-fraud with the separate issue of the state giving people too much in benefits. A story about a woman who steals £60,000 from the state in a benefit fraud is equated with the story of a man who claims housing benefit of £2.1m a year to live in Kensington are seenn as somehow part of the same problem.  However, they are problems of a completely different order – The first is a case of someone breaking the law, who should be (indeed, was) caught and punished.  The second is someone acting perfectly legally and in their own interests, within the system operated by the Royal Borough of Kensington & Chelsea.  We solve the first case by investigating criminality.  We solve the second problem by forcing the borough into building more and better social housing (if indeed you consider humanely housing a group of refugees to be a ‘problem’).  Housing policy, and the level of benefits paid to those not in work, seems to me to be an ideological argument, where Labour and the Tories have very different views.  Meanwhile, everyone agrees that benefit fraud is wrong and must be stopped.  Public discussion on benefit fraud doesn’t always make this clear… and the Left loses the argument as a result.

One Reply to “On Benefit Fraud”

  1. Excellent blog Rob, with thoughts I have been thinking for a long time.

    How odd that the media can stir such fury over ‘benefit fraud’ while tax evaders slip away virtually unnoticed. At the same time public wrath has been diverted from banks to binmen. Something mighty wrong with our values – or the way they are presented in public.

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