The Department for Work and Pensions (DWP) has confirmed that five major benefits will be assessed for fraud and error during the 2026/27 financial year, with findings due to be published in May 2027. The benefits included in the latest review programme are Universal Credit, Housing Benefit (pension age, non pass-ported cases), Pension Credit, State Pension and Personal Independence Payment (PIP).
Fraud and Error Measurement Programme
Details were published in the DWP’s latest Fraud and Error in the Benefit System report for the 2025/26 financial year. The annual report measures how much benefit spending is lost through fraud, claimant error and official error across the welfare system. The DWP uses reviews of randomly selected claims, alongside administrative checks and wider analysis, to estimate levels of incorrect benefit payments across the system. The Department stressed that the figures are estimates designed to measure overall levels of fraud and error in the benefits system rather than findings linked to individual claimants.
Universal Credit Remains a Focus
Universal Credit is expected to remain one of the main areas of focus after the latest report showed it continued to account for the largest proportion of benefit overpayments. The DWP estimated Universal Credit overpayments at 10.5 per cent (£9.5 billion) in the year ending April 2026. By comparison, State Pension continued to record the lowest overpayment rate of all DWP benefits at 0.2 per cent (£230 million). However, the report said historic Home Responsibilities Protection (HRP) errors remained the biggest reason for State Pension underpayments linked to National Insurance contribution records. The DWP said these errors accounted for “£6 in every £10 underpaid due to Contributions”.
Pension Credit and PIP Under Scrutiny
Pension Credit is also expected to remain under close scrutiny after the latest figures showed overpayments of 9.7 per cent (£620 million) and underpayments of 1.3 per cent (£80 million). Meanwhile, PIP is continuing to be included in the DWP’s fraud and error measurement programme as the UK Government examines spending across disability and working age benefits. PIP is a key disability benefit which provides between £121.20 and £778.40 every four week payment period to more than 3.9 million people across England and Wales. The benefit has been replaced in Scotland for nearly half a million claimants by the devolved benefit, Adult Disability Payment.
Disability Charity Responds
Evan John, policy adviser at the national disability charity Sense, told the Daily Record: “Fraud is very uncommon amongst people claiming disability benefits, with the vast majority of funds being used as intended: offsetting the additional costs that come with being disabled, and enabling disabled people to afford the essentials. Benefits are an absolute lifeline for disabled people with complex needs.” Sense is also urging the UK Government “to recognise how important disability benefits are for society, and commit to not making any further cuts to disability benefits during their time in government”.
Definitions of Fraud, Claimant Error and Official Error
The DWP defines the three types of fraud and error. Fraud refers to claims where all three of the following conditions apply: the conditions for receipt of benefit, or the rate of benefit in payment, are not being met; the claimant can reasonably be expected to be aware of the effect on their entitlement; and benefit payment stops or reduces as a result of the review. Common examples of benefit fraud include faking an illness or injury to get unemployment or disability benefits, failing to report income from a business or employment to make income seem lower than it actually is, living with someone who contributes to the household income without declaring that income to the authorities, and falsifying accounts to make it seem like a person has less money than they say they do.
Claimant error occurs when the claimant has provided inaccurate or incomplete information, or failed to report a change in their circumstances, but there is no evidence of fraudulent intent on the claimant’s part. Official error happens when the benefit has been paid incorrectly due to a failure to act, a delay or a mistaken assessment by the DWP, a local authority or HM Revenue and Customs (HMRC), to which no one outside of that department has materially contributed, regardless of whether the business unit has processed the information.
