Tax evasion/benefit 'fraud'

[ViolentPanda]

Only insofar as they are both against the law. Of course someone who is swindling "a couple of million quid" deserves a much stiffer punishment than someone who is swindling £20 quid.

Unfortunately, what is deserved and what actually occurs within the criminal justice system are two entirely different things.

(Are we talking about taking "cash in hand" regularly whilst at the same time claiming benefits?)

I'm talking about all non-organised (i.e. perpetrated by individuals rather than gangs) benefit fraud (of which "regular claiming while working" makes up about a fifth of investigated claims according to DWP).

Corporate fraud/illegal tax evasion being wrong doesn't make benefit fraud acceptable to me.

SOME benefit fraud is acceptable to me, the kind of "mutual self-help" that mums on estates often engage in, looking after one anothers' kids when they're supposed to be doing a "jobsearch", or when they're doing a few hours casual work.
The problem with the system is its' "all or nothing at all" nature. If you don't give people the room to manouvre you actually encourage some fraud, which is why (as I mentioned earler) I believe that policing of benefit fraud is as much an exercise of a social control mechanism as some kind of righteous attempt to save public money.

On the contrary, I find it odd that you apparently condone workers, rich and poor, paying more tax because of benefit fraudsters.

A simple bit of maths (GDP divided by sum total of benefit fraud) tells you that if one did pay more tax due to "benefit fraud" it would amount to fractions of a penny, as opposed to the significantly larger amount tax evasion could be said to add to the burden.

And I can see all sorts of shades of grey, and I even sympathise with single mothers on sink estates. I understand, but don't condone, their benefit frauds.

I haven't done anything wrong and have never been nicked, although with the government's love of banning all sorts of things and an increasingly politicised police force, who don't seem to see their role as being to "serve and protect" any longer, I might just get nicked for something in the future.

Maybe you think that's odd too. You could put it down to the vagaries of the female mind.

My apologies for the gender miscasting!

 

[HarrisonSlade]

I find it rather odd that all of the newspapers seem to show us that people who are earning a little extra for themselves than the pitiful welfare cheques have to offer are the main leeches on the exchequer, than those waelthy types who rip off the tax man for millions every year. I also find it odd that the very same newspapers rarely mention the fat cats who "borrow from" pension acounts to pay for important things for the company (ie expensive lunches, yatchs, etc).

I would just like to point out that I do not mean to slander the names of Rupert Murdoch, the Barclay Brothers, Richard Desmond, the board of Guardian Media Group PLC and all those who still run the media, especially the present day proprietor of the Mirror Group, and will not, to suggest that all of these people could ever compare to Robert Maxwell. As neither of them are grossly overweight, or have drowned after falling off their yachts.

 

[goneforlunch]

Benefit fraud is one of the things that irks me a lot, I understand why people do it, but I don't really like it very much.

I have used Benefit and will continue to use it in the future when the need arises, but I have never used it fraudulantly. I have never claimed and worked, I have never claimed what I was not entitled to. So it bothers me that people do.

Still it bothers me a lot more that a company's directors will spend a lot of money on accountants so they can avoid paying a lot more in tax, just to up the share price a half penny to increase the value of their own shares.

Both bother me, and I too can understand why people make fraudulent benefit claims. I also understand why Companies use accountants to legally minimise their tax liabilities. And it's perfectly reasonable to want to increase the value of a company; that's good business sense and it is what the country's prosperity is based on.

Taxes, especially since Labour took office, have risen way above the rate of inflation and all kinds of other government controlled petty costs on businesses have risen, adding to the Treasury's coffers. I'm not a fan of big corporations, I have no loyalty towards them, but I can't fault their business acumen all the same.

Unfortunately, what is deserved and what actually occurs within the criminal justice system are two entirely different things.

Couldn't agree with you more on that.

I'm talking about all non-organised (i.e. perpetrated by individuals rather than gangs) benefit fraud (of which "regular claiming while working" makes up about a fifth of investigated claims according to DWP).

SOME benefit fraud is acceptable to me, the kind of "mutual self-help" that mums on estates often engage in, looking after one anothers' kids when they're supposed to be doing a "jobsearch", or when they're doing a few hours casual work.

The problem with the system is its' "all or nothing at all" nature. If you don't give people the room to manouvre you actually encourage some fraud, which is why (as I mentioned earler) I believe that policing of benefit fraud is as much an exercise of a social control mechanism as some kind of righteous attempt to save public money.

I don't really object to some short term rule bending in order to improve one's chances of a better life off benefits, but I would be surprised if many people fall into this category. Tbh I think too many see cash in hand casual work as a way of life without any further ambition. But I do agree with you on the reason for the policing of benefit fraud being more due to a desire for social control than any attempt to save on public finances.

A simple bit of maths (GDP divided by sum total of benefit fraud) tells you that if one did pay more tax due to "benefit fraud" it would amount to fractions of a penny, as opposed to the significantly larger amount tax evasion could be said to add to the burden.

Officially sanctioned reports on benefit fraud say the amount lost is "astronomical" and figures are so innacurate they are rounded up to the nearest half billion! I don't see how this can be said to amount to fractions of a penny. I do not agree with illegal tax evasion either. Both are wrong.

ps. The gender thing's not a problem.

 

[tobyjug]

Officially sanctioned reports on benefit fraud say the amount lost is "astronomical" and figures are so innacurate they are rounded up to the nearest half billion!

If you bother to read the ACTUAL statements by the Audit Office on this subject you will note the comments are always about benefit fraud AND mistakes by benefit officials. The gutter press and the media omit to mention that the estimates are a combined figure with the mistakes being far higher than the fraud.

 

[goneforlunch]

If you bother to read the ACTUAL statements by the Audit Office on this subject you will note the comments are always about benefit fraud AND mistakes by benefit officials. The gutter press and the media omit to mention that the estimates are a combined figure with the mistakes being far higher than the fraud.

I did read the ACTUAL statements from the National Audit Office - they were plastered all over the media. But it is still true to say that benefit fraud is astronomical. The NAO has said that that it would give the DWP's accounts a clean bill of health if it reduced benefit fraud to 1%, or £1bn, of expenditure. The DWP still has some way to go.


Mistakes by Benefits Office staff are also astronomical too, though certainly not higher than fraud. Where did you get that information from? Certainly not the National Audit Office!

And does the fact that mistakes are made by staff mean that we should pat benefit fraudsters on the head as if their dishonesty does not matter? You don't seem to see benefit fraud as problem though, so I expect you think we should.

 

[tobyjug]

I did read the ACTUAL statements from the National Audit Office - they were plastered all over the media.

No they weren't, an edited by the newspapers and media, are always printed not what is in the actual document.
If one puts the estimates oft quoted in the contect of the total social security budget they are at a low percentage of "wastage" any private company would kill to have.

I suggest reading this, in its entirety , and the other files linked to it:- http://www.nao.org.uk/publications/nao_reports/05-06/0506592.pdf

 

[goneforlunch]

I did read the ACTUAL statements from the National Audit Office - they were plastered all over the media.

No they weren't, an edited by the newspapers and media, are always printed not what is in the actual document. If one puts the estimates oft quoted in the contect of the total social security budget they are at a low percentage of "wastage" any private company would kill to have.

This information about staff error was also widely reported by the media although obviously not in as much detail as the full report, and not disguised in any way. The amount lost to fraud (and staff error) is a small percentage of the overall budget, but nevertheless at least £1.5 billion of public money is still lost to fraud. But in reality no one really knows how many claims are made fraudulently, so it could even be a lower or higher amount.

I doubt any private company would be at ease, let alone "kill" to have lost that much money to fraud (or to mistakes by its staff) and a sensible board of directors would have to take action to control the problem if it wanted the company to remain viable. But even if for some inexplicable reason appropriate action was not taken, it would still be a matter for that company, being a private company, and any workers it might have, and not generally a matter for the taxpayers or the government to become involved in.

Public finances are different in that taxpayers money is used. I hope you can appreciate the difference.

I suggest reading this, in its entirety , and the other files linked to it:- http://www.nao.org.uk/publications/...-06/0506592.pdf

An interesting report, but it deals with the undeniable complexity of the benefits system, not fraud. It is however interesting in that it sets out in some detail just how ridiculously complicated the system is for both staff and "customers". But then the fact that it is so is not exactly breaking news. The NAO certainly does not say that mistakes made by benefit office staff are "far higher" than fraud.

And does the fact that mistakes are made by staff mean that we should pat benefit fraudsters on the head as if their dishonesty does not matter? You don't seem to see benefit fraud as problem though, so I expect you think we should.

????


I sense that we are simply looking at this from different perspectives, so if you don't regard benefit fraud as a cause for concern, I respect your right not to do so.

 

[ViolentPanda]

With respect to benefit fraud, it is worthwhile bearing in mind that the sum total minus those monies figured as the result of staff error, is not a reflection of benefits fraud as committed by individuals, but a reflection of institutional and organised fraud as well as occasional fraud by individuals.

Of course, it could be argued that it is in the interest of neither the yellow press nor of "the establishment" to differentiate between the originators of these frauds, or to examine the motivation(s) behind them.

I shall have a look at the pdf toby posted a link to to see whether it has anything to say on the matter.

 

[tobyjug]

but nevertheless at least £1.5 billion of public money is still lost to fraud. But in reality no one really knows how many claims are made fraudulently, so it could even be a lower or higher amount.

I doubt any private company would be at ease, let alone "kill" to have lost that much money to fraud (or to mistakes by its staff) and a sensible board of directors would have to take action to control the problem if it wanted the company to remain viable.

Against the total social security budget £1.5 billion is quite frankly fuck all.
Any private company company having such a tiny percenatage "wastage" on their total turnover would jump for joy.
You are being fooled by the £1.5 billion. It is not as percentage of the total budget much money at all.

 

[blazzers]

The level of benefit fraud is actually pretty low - as others have pointed out, it's easily offset by the benefits that remain unclaimed (tax credits and council tax benefit are good examples of how complexity has deterred claimants).

On tax avoidance, and corporate tax avoidance in particular, this probably won't be a popular opinion here, but the answer is surely to abolish corporation tax. It doesn't raise much in the big scheme of things (about 30bn out of roughly 500bn in tax revenues), and causes a huge waste of resources in terms of the armies of lawyers and accountants on the avoidance side, and revenue officers on the government side. Then, once it had been abolished, the government could turn a deaf ear to the whinging of the CBI - something along the lines of 'You don't pay any tax so fuck off'. This will surely happen one day - revenues are only going one way in a globalised world (down) and costs of collection are going the other way (up). Where to get the lost money from? Cutting corporate welfare schemes of one kind or another should fill most of the gap, and the rest might be filled by increased taxes on pollution. At the moment, there seems to be an informal agreement amongst large countries to retain the tax, and the levels are pretty consistent, in the 25-40% range. Someone will blink first though, and abolish it, and then the rest will follow.

 

[goneforlunch]

With respect to benefit fraud, it is worthwhile bearing in mind that the sum total minus those monies figured as the result of staff error, is not a reflection of benefits fraud as committed by individuals, but a reflection of institutional and organised fraud as well as occasional fraud by individuals.

Of course, it could be argued that it is in the interest of neither the yellow press nor of "the establishment" to differentiate between the originators of these frauds, or to examine the motivation(s) behind them.

I shall have a look at the pdf toby posted a link to to see whether it has anything to say on the matter.

Fair enough, but I'm unhappy with the amount of fraud. I have a little sympathy for some individual benefit fraudsters (because they lead such unhappy lives, not because they need the money) and none at all for organised fraud.

I don't have much respect for the "establishment" or the media.

My feelings on this are probably influenced by acquaintances who happily boast about their unhindered abuses of the benefit system. The motivation behind fraud is to gain more than the fraudster has a right to. Simple as that. Sorry if you think that's hard, but it's the way I feel.

Against the total social security budget £1.5 billion is quite frankly fuck all.
Any private company company having such a tiny percenatage "wastage" on their total turnover would jump for joy.

Tobyjug, you are unreal!

As I said before ...

I doubt any private company would be at ease, let alone "kill" to have lost that much money to fraud (or to mistakes by its staff) and a sensible board of directors would have to take action to control the problem if it wanted the company to remain viable.

You are being fooled by the £1.5 billion. It is not as percentage of the total budget much money at all.

I think £1.5 billion is a huge amount of money, and the fact that it is a small percentage of the overall total does not, certainly not imo, mean that it is "fuck all". How many leaky school rooves could that fix? How many hip replacement operations could it pay for? Or body armour for soldiers? etc, etc. I am not being fooled by anyone at all (especially not you.)

I have expressed my respect for right to think as you do, but you seem incapable of showing me the same consideration so I have put you on ignore.

 

[mutley]

And another thing ...

Why do we pay anything at all into the EU? How does the EU benefit us?

We should be spending the money in the UK on our own causes, like increased pay for nurses, not funding stuff like a new underground system in Warsaw.

Someone who is healthy, or has private health insurance, could use exactly the same logic to argue against paying for the nurses that you want to support.

And where would your regionalist logic end? If they build a metro in (say) Edinburgh why should i in the Midlands pay for it?

nationalist bollocks i'm afraid.

 

[ViolentPanda]

Fair enough, but I'm unhappy with the amount of fraud. I have a little sympathy for some individual benefit fraudsters (because they lead such unhappy lives, not because they need the money) and none at all for organised fraud.

I'm totally unsympathetic to organised fraud myself, unfortunately it's nowhere near as thoroughly policed by the DWP and other benefits administration departments as individual fraud is, and the reasons are manifold but include: complexity, scale, trans-nationality of the fraud and degree of danger.
It boils down to being easier (especially in terms of fulfilling "preformance indicators") to chase Joe Public for a small fraud than to chase (for example) an eastern European or Nigerian gang or a landlord coercing his benefit-recipient tenants to submit false/inflated claims (I had this tried on me several times over the years so know it goes on) for housing benefit.

I don't have much respect for the "establishment" or the media.

Neither do I, not until they do something to earn it.

My feelings on this are probably influenced by acquaintances who happily boast about their unhindered abuses of the benefit system. The motivation behind fraud is to gain more than the fraudster has a right to. Simple as that. Sorry if you think that's hard, but it's the way I feel.

There will always be a minority of fraudsters in any kind of welfare system, and unfortunately their greed makes life harder for those of us who have no choice but to live on benefits. I just wish more people would absorb the fact that fraudsters are a minority, rather than the rule.

Tobyjug, you are unreal!
<snip>
I think £1.5 billion is a huge amount of money, and the fact that it is a small percentage of the overall total does not, certainly not imo, mean that it is "fuck all". How many leaky school rooves could that fix? How many hip replacement operations could it pay for? Or body armour for soldiers? etc, etc. I am not being fooled by anyone at all (especially not you.)

I have expressed my respect for right to think as you do, but you seem incapable of showing me the same consideration so I have put you on ignore.

Given how much of taxpayers money LEAs and the MOD spunk, perhaps using them as examples of organisations who could benefit financially from the shrinking of benefit fraud is a bit ill-considered.

 

[tobyjug]

Tobyjug, you are unreal!

As I said before ...
I think £1.5 billion is a huge amount of money, and the fact that it is a small percentage of the overall total does not, certainly not imo, mean that it is "fuck all". How many leaky school rooves could that fix? How many hip replacement operations could it pay for? Or body armour for soldiers? etc, etc. I am not being fooled by anyone at all (especially not you.)

I have expressed my respect for right to think as you do, but you seem incapable of showing me the same consideration so I have put you on ignore.

Please yourself but if you cannot understand ANY private organisation would be proud to have a "wastage" percentage as low as the benefits system has I cannot help that. I note you have made no mention of the at least £2 billion unclaimed by retired people who are legally entitled to it, but will not claim it because it is means tested.

 

[goneforlunch]

Someone who is healthy, or has private health insurance, could use exactly the same logic to argue against paying for the nurses that you want to support.Someone who is healthy, or has private health insurance, could use exactly the same logic to argue against paying for the nurses that you want to support.

Not really. Someone who is healthy may not always be that way, and private health insurance subscribers still need the NHS for emergency treatment, or if they could no longer afford private health insurance.

And where would your regionalist logic end? If they build a metro in (say) Edinburgh why should i in the Midlands pay for it?

I'm not a "regionalist"; that's Prescott's plan to fit in the with Europe of the Regions. I don't really object to being called a "nationalist" though. I bet Jacques Chirac doesn't either.

In view of your comments, I wonder if you can answer my question from earlier in this thread?

Why do we pay anything at all into the EU? How does the EU benefit us?

You will need to come up with some pretty good benefits, because the drawbacks are major. Do tell ...

 

[goneforlunch]

I'm totally unsympathetic to organised fraud myself, unfortunately it's nowhere near as thoroughly policed by the DWP and other benefits administration departments as individual fraud is, and the reasons are manifold but include: complexity, scale, trans-nationality of the fraud and degree of danger.

It boils down to being easier (especially in terms of fulfilling "preformance indicators") to chase Joe Public for a small fraud than to chase (for example) an eastern European or Nigerian gang or a landlord coercing his benefit-recipient tenants to submit false/inflated claims (I had this tried on me several times over the years so know it goes on) for housing benefit.

I wouldn't be surprised to learn you are right about the DWP policing individual fraud more than organised fraud. We see it in all walks of life these days - from the police harrassing the public for the pettiest of reasons, to the CSA driving fathers already paying maintenance for their children to suicide whilst leaving others who pay nothing in peace, to the HSE harrassing reputable companies over safety standards whilst ignoring the unsafe practices of the cowboy firms.

That doesn't mean that policing individual benefit fraud is wrong, just that the organised fraud should be policed even more. A question of priorities. Though I did hear of a government minister talking lie detectors for benefits claimants. Now that is really creepy, and I hope it doesn't come to that.

I don't have much respect for the "establishment" or the media.

Neither do I, not until they do something to earn it.

But we're not holding our breath, are we?

There will always be a minority of fraudsters in any kind of welfare system, and unfortunately their greed makes life harder for those of us who have no choice but to live on benefits. I just wish more people would absorb the fact that fraudsters are a minority, rather than the rule.

I agree there will always be fraudsters in the system, but you can't know how many there are because no one really knows the extent of the fraud. And we would probably disagree about how many people have no choice but to live on benefits too.

Given how much of taxpayers money LEAs and the MOD spunk, perhaps using them as examples of organisations who could benefit financially from the shrinking of benefit fraud is a bit ill-considered.

Is there a branch of the public services about which that could not be said? But if public services can't be run efficiently, I'd still rather see soldiers get their body armour, or schools got their leaking rooves fixed, or the elderly got their hip replacements, than benefits claimants [individual or organised] get money they are not entitled to.

 

[likesfish]

what might actually help if the rules were not so dracionian about declaring part time work or a bit of tempoary work yeah 95% level of taxation on claiments is really going to encourage people to help themselve ininit

 

[ViolentPanda]

what might actually help if the rules were not so dracionian about declaring part time work or a bit of tempoary work yeah 95% level of taxation on claiments is really going to encourage people to help themselve ininit

It used to be that you could declare work on a day-by-day basis, so if you worked monday, wednesday and friday one week you'd still get your giro covering the other days as long as what you'd earned didn't go over a certain threshold.

I'd actually like to see a system similar to the one the Republic of Ireland used to (and may still do for all I know) have, where you could still claim full dole if you'd earned less than 100 punts. It gave a lot of scope to casual and seasonal workers to be able to arrange their finances better.

My personal situation is that I'm reliant on benefits. I'm disabled and although I have MANY sellable skills I'm only able to use them sporadically, so no employer will want to employ me, and I can understand why, you don't hire someone who doesn't produce to order.
What I would be able to do is work for myself when able (pretty much what I do now under the "therapeutic work" guidelines) and make a little extra money, which, if it passed taxation thresholds, I'd be happy to pay tax on.
I'm pretty certain there are hundreds of thousands of people in the same situation as me, and that's just people on disability benefits, not including people on JSA who NEED to keep their skills sharp, but I'm personally convinced that the state prefers to keep people "under the thumb" than give them a sense of independence.

 

[BL2ALLb]

Some countries have a Flat Tax System which actually cuts attempts at tax evasion and fraud because quite simply everyone has to pay the same flat rate of tax regardless of earnings. In turn the revenue collection is far easier.

As for the difference between tax fraud and benefit fraud would be the 'defence' used in court.....can a judge connect with a poor lil mum or do they connect with a corporate bod? I just imagine the lectures a judge would give...... the difference being NEED or GREED.

Flat tax is too simple as many are employed/profit/parasitic due to the dinasour of the Inland Revs tax system

 

[goneforlunch]

As for the difference between tax fraud and benefit fraud would be the 'defence' used in court.....can a judge connect with a poor lil mum or do they connect with a corporate bod? I just imagine the lectures a judge would give...... the difference being NEED or GREED.

A judge shouldn't be 'connecting' with someone who has broken the law. He or she should be handing down an appropriate punishment. It still GREED in either case. The corporate fraudster is just greedier.

That's just my opinion obviously.

I agree with a flat tax system, and also that it won't happen for the reasons you mention.