Single Fraud Investigation Service (SFIS)

CIPFA North West Audit, Risk and Governance Group

Autumn Seminar 9th October 2015

Andrew Bloor, Jane Whyatt

Creation of the Single Fraud Investigation Service (SFIS)

Oldham Council’s experience of the move to the Single Fraud Investigation Service and the development of a Council corporate fraud

team……

Creation of SFISToday’s Agenda

• Background to SFIS• Oldham SFIS Pilot• Project Risks and Mitigations• Oldham SFIS Lessons Learned:

– What went well?– What didn’t go so well?– What would we do differently?

• Corporate Counter Fraud at OMBC• Questions and Discussion

Creation of SFIS Background – Welfare Reform Act 2012

• Welfare Reform Act 2012 - a wide range of changes• Creation of a Single Fraud Investigation Service (SFIS):

The SFIS will bring together council, DWP and HMRC investigation services under one umbrella to investigate all welfare and tax credit fraud and to conduct a single investigation covering the totality of the fraud. The SFIS will not be responsible for investigating non-benefit fraud such as council tax or tenancy fraud.

• The Go Live of a SFIS was confirmed in the Autumn Statement by the Chancellor of the Exchequer on 5 December 2013.

Creation of SFISNational Pilot Programme

• November 2012 - Programme of National Pilots • First Tranche of Pilots – 4 organisations• DWP engaged with Oldham – February 2013• Pilot Objectives:

– Different working arrangements/approaches to SFIS partnership– Testing different locations and co-location– Different structures e.g. outsourced Benefits– Resource plans e.g. buddying arrangements– Track results from all Pilots– Devised single set of policies/procedures to shape delivery model

Creation of SFISOldham Pilot Arrangements• Key Council Stakeholders:

– Benefits Administered by Partner (Unity Partnership)– Council’s Client Function monitors service delivery– Benefit Fraud in Audit and Counter Fraud Team

• SFIS Pilot led by DWP Project Manager with support:– Universal Credit Pilot – investigate cases– Based at the Council offices/access to two IT systems– Buddy working and joint management arrangements– Review of electronic case file trial

• Staff Development and Learning:– Bespoke training on DWP system delivered locally– Cultural awareness for DWP and LA staff/ buddying staff

• Monitor and feedback Results to Team/DWP

Creation of SFISOldham Pilot Risks

Risk:•Resources assigned to Pilot would affect/ hinder BAU results

•Cultural differences would lead to Pilot failure and difficult transition

•ICT systems set up failures lead to inability to deliver

•SFIS would not go ahead on time (sunk cost)

Pilot Response:•Managed expectations of managers/ Members re: results during Pilot

•Allowed workflows to be captured or development of corporate team

•Management support (DWP & OMBC)

•Co-location to “get to know”/ “buddying”

•Cultural workshop/training

•Project Plan IT focus/Risk Log

•System training for both teams

•Conference calls between Pilots

•Welfare Reform Act – announced by Chancellor – led to focus

Creation of SFISOldham Pilot Risks

Risk:•Ineffective process for investigating fraud leading to reputational damage

•Loss of knowledge leading to lower than planned results

•Poor stakeholder engagement leading to less than optimal investigations

•Inability to achieve desired results from insufficient resource

•Too much resource leading to cost/ poor VFM

Pilot Response:•E2E processes agreed

•Corporate Fraud processes redefined

•Benchmarking with other Pilots

•Support for investigative interviewing

•Collaboration across the wider team

•Sound procedures/ redefined

•Stakeholder management plan

•Communicated results to team

•Monitored Pilot resources/tracked results

•Pilot allowed BAU to be defined

•As above, tracking results allowed appropriate resource to be defined

Creation of SFISMitigating the Project Risks

• Review Project Risk Log from Council perspective • Engage with staff at all stages for a smoother transition:

– Before, during and after pilot– Support the agreed HR process– 121s with staff and group meetings with HR

• Manage stakeholders:– Close management attention to the Pilot– Ensure approvals are obtained by briefing senior managers– Brief Audit Committee

• Creating Corporate Counter Fraud Team:– Use Prior Year results to determine workflows/demand– Consider skills for an effective Audit and Counter Fraud Team

Creation of SFIS – AGMA & Associates* Transferred

AGMA Delegate Authority Transfer Date

Already Transferred:

1 - Oldham Jul 2014

2 - Tameside Feb 2015

3 - Bolton Feb 2015

4 - Wigan Feb 2015

5 - Rochdale Mar 2015

6 - Stockport Mar 2015

7 - Bury Mar 2015

8 - Blackburn (with Darwen) * Apr 2015

9 - Blackpool * Apr 2015

Creation of SFIS AGMA & Associates* To Transfer

AGMA Delegate Authority Transfer Date

Awaiting Transfer:

1 - Cheshire East * Dec 2015

2 - Manchester Feb 2016

3 - Salford Feb 2016

4 - Warrington * Mar 2016

5 - Trafford Mar 2016

SFIS Transfer Lessons LearnedWhat went well...?

• Pilot Objectives were met• Good Pilot Results• Smooth Transition and on time on 1st July 2014• Smooth Staff Transfers:

– In accordance with plans and process– In accordance with skills, development plans– Some team promotion since

• Retained Corporate Counter Fraud Team:– All approvals obtained– Briefed Members – Audit Committee

• Corporate Team - strong results post transfer

SFIS Transfer Lessons LearnedWhat went well…?

Smooth Transition/On TIme::• DWP Project Manager support• Opportunity for managers to shape the

retained team/test BAU• Captured good results vs other SFIS

Pilots• Audit and Counter Fraud team focus on

core business

Training and Development:• Training material was detailed, well

designed, good quality• Culture workshop aided transition• Opportunity to integrate with potential

colleagues• Buddying and shared IT knowledge

Staff Engagement/Morale:•Selected by DWP due to results•Opportunity to consider skills/career•Provided certainty•Helped to shape the design nationally•Understood the joined up approach and the rationale behind SFIS

Collaboration / Joint Working:• Changed the way fraud is investigated• Effective collaborative operations with

the Police, DWP continues• Effective CTR investigations• Electronic case file trial success• Audit and Counter Team opportunities• Manager and Member engagement

SFIS Transfer Lessons LearnedWhat didn’t go so well..?

• Phase 1 Tight Implementation:– Challenge for all activities to be undertaken effectively– Staff communication not always aligned and were often late– Impact of change in DWP Project Manager

• HMRC involvement remains a Challenge• Sharing of local data / outcomes since the Transfer• Cultural Challenges between 2 organisations:

– Local risk management – difference in approach/processes

• Single Point of Contact (SPOC) – process refinement• Investigative Interviewing Capacity is Tight

SFIS Transfer Lessons LearnedWhat we would do differently …?

Learning:

•Define Post SFIS arrangements for SPOC, engage the Benefit Client earlier in process

•Reputational / local political risk covered by MOU but remains a consideration

•Skill set for retained function

Response:

•Liaise with SPOC to review E2E

•Audit review of arrangements

•SPOC role to include review of MOU

•MOU reviewed annually

•Contact DWP re: case outcomes

• Addressed by training and support

• Team collaboration

Post SFISOldham Corporate Counter Fraud• Council Tax Reduction• Council Tax Discounts• Business Rates Fraud• Free School Meals• Social Care Misuse• Blue Badge Misuse• Whistleblowing Fraud Hotline/Online Fraud Referral

– Employee Investigations/others• Proactive Data Matching – NFI and HBMS• Planned Audit and Counter Fraud Reviews• Training and Development – Staff and Members

Corporate Counter Fraud Team2015/16 YTD ResultsInvestigation Type Successful

CasesOutcomes

£Council Tax Reduction 51 38,294

Council Tax Discount/Exemption 230 59,110 *

HB (overpayments identified as part of CTR investigations – referred to SFIS)

51 139,000

Blue Badge 41 20,500 *

Free School Meals 16 -

Employee – Abuse of Position 13 19,715

Procurement 1 224,963

Social Care 8 27,455

National Fraud Initiative 43 85,307

Creation of SFISSome Questions from Colleagues…..(1)• Q: How did the team prepare for the transfer, what happened to

the benefit investigations that were being carried out at the time of transfer?

• A: There are three elements to the answer:– Cases were worked on during the SFIS Pilot; therefore no

cases were transferred by Oldham. However, in other transfers, cases are forwarded to the DWP to set up on FRAIMS, then allocated back out to the Fraud Investigator.

– Audit Managers also looked at the Corporate Counter Fraud results, trends and estimated future demand to help to determine the resources required for the retained team.

– Key stakeholders and Members were kept up-to-date during the transfer.

Creation of SFISSome Questions from Colleagues…..(2)

• Q: How does the remaining fraud team deal with the work created since the transfer?

• A: All cases are risk assessed in line with in house protocols. Since the transfer there has been a variety of different allegations received and investigated as per Corporate Counter Fraud results earlier. The team also handles CTR investigations and forwards relevant information to the DWP.

Creation of SFISSome Questions from Colleagues…..(3)

• Q: What arrangements are in place with regards admin support post SFIS (e.g. access to system information/claim documentation)?

• A: The Audit and Counter Fraud team currently has an Apprentice who undertakes the admin support role on all investigations. The team maintains its access to all systems including Council Tax, Housing Benefits and NNDR systems as per pre–transfer to deliver the retained service and the Audit & Counter Fraud Plan.

Creation of SFISSome Questions from Colleagues…..(4)

• Q: How will the DWP obtain information from the authority (application forms, calculation of overpayments etc)?

• A: DWP follow the agreed protocol set up at the start of the transfer. A signed Memorandum of Understanding (MOU) needs to be signed by both parties. All information on Welfare Fraud is provided by the Revenues and Benefits Service (delivered at Oldham by the Unity Partnership).

Creation of SFISSome Questions from Colleagues…..(5)

• Q: We are considering what to do about the residual CT and Business Rates fraud work and whether you transferred all your fraud officers or if you retained any? If you retained any what is their remit and where do they sit in the organisation?

• A: Oldham Internal Audit and Counter Fraud team continue to investigate a wide variety of fraud and misuse including Council Tax and Business Rates. The residual Counter Fraud team consist of 2 FTE, which includes the Assistant Manager – Counter Fraud, the Corporate Counter Fraud Officer and also there is currently Admin Support from an Apprentice.

Creation of SFISPost SFIS Team Successes…

• Flexible Audit and Counter Fraud Team:– Greater joint working/aligned cultures and style– Ability to focus on corporate fraud risks to support Council

governance– Deliver Audit and Counter Fraud Plan– Responsive to demand

• Redefined Corporate Counter Fraud Processes:– Successes reported to Managers and Audit Committee– Increase in whistleblowing referrals/ demand increased– New case system/aligned to Insurance fraud collaboration– Training proposition under development/intranet content review

Creation of SFISSummary: Please consider……

• Track Results to determine resource requirements

• Plan Corporate Counter Fraud resource now

• Engage with staff in scope throughout process

• Brief Members and Managers early

• Determine SPOC/ Post Transfer Arrangements now

Creation of SFISKey Contacts

• Audit and Counter Fraud contacts:

• Andrew Bloor 0161 770 1205 andrew.bloor@oldham.gov.uk

• Emma Parker 0161 770 4895 emma.parker@oldham.gov.uk

• Jane Whyatt 0161 770 4773 jane.whyatt@oldham.gov.uk

• Fraud Hotline 0161 770 4969 investigations@oldham.gov.uk

SFIS TransferAnd Finally……

Any Questions?Thank you!