Covid-19 raises risk of public-sector fraud

Scotland's public finances have been boosted after a data-sharing exercise identified over £15 million of potential fraud and errors across the public sector.

But auditors have warned that the Covid-19 pandemic has brought additional fraud risks. They include public-sector staff working remotely under extreme pressure, and potentially less scrutiny of applications for government stimulus packages for individuals and businesses.

Over 120 public bodies participated in the latest National Fraud Initiative (NFI), which is coordinated by Audit Scotland every two years. The NFI compares electronic data about individuals held by different public bodies to identify potential errors or fraud, and to ensure pensions, housing benefit and other services go to the right people.

Fraud and errors totalling £15.3 million were identified since the last report in 2018. This figure includes an estimate for prevented future losses.

Fiona Kordiak, Director of Audit Services said:

These results demonstrate the value of data-matching to Scotland's public finances at a time when Covid-19 has put budgets under intense pressure.

The pandemic has also brought additional fraud risks that will be important for public bodies to identify and manage. Many staff are working remotely under extreme pressure which makes good governance and sound controls more important than ever.