Public Money & Management

ISSN: 0954-0962 (Print) 1467-9302 (Online) Journal homepage: http://www.tandfonline.com/loi/rpmm20

Fraud: from national strategies to practice on the

ground—a regional case study

Alan Doig

To cite this article: Alan Doig (2018) Fraud: from national strategies to practice on
the ground—a regional case study, Public Money & Management, 38:2, 147-156, DOI:
10.1080/09540962.2018.1407164

To link to this article: https://doi.org/10.1080/09540962.2018.1407164

Published online: 16 Jan 2018.

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 147

Fraud: from national strategies to

practice on the ground—a regional
case study
Alan Doig
The intentions of a number of national strategies and other initiatives to address
fraud are reviewed in the context of one UK region. This paper considers how far
various agencies in that region have responded to fraud. It then discusses which
factors appear to have influenced the role of the strategies and other initiatives as
an anti-fraud framework or to deliver anti-fraud work.
Keywords: Fraud; public sector; strategies.
Fraud: the context measurable delivery. In 1998, the Department Alan Doig is Visiting
Before the UK’s 2006 Fraud Review of Health (DH) announced a Directorate of Professor, Newcastle
Prior to the Fraud Review, responsibility for Counter Fraud Service (NHSCFS) and published Business School,
preventing or investigating fraud lay with, its ‘overall strategic framework within which the Northumbria
whether in terms of approaches or resources new unit will meet its remit—our policy, aims University, UK.
committed by public sector bodies or by individual and objectives together with the approach, tactics
police forces, the organizations themselves. For and standards we propose to adopt’ (DH, 1998,
a number of the organizations, external auditors p. 8). In 2002, the Proceeds of Crime Act added
at central and local levels—the National Audit another criminal justice sanction that would
Office (NAO) and the Audit Commission— allow the confiscation of any benefit from criminal
undertook reviews to assess their arrangements activity, including fraud. In 2006, the first Fraud
(Doig, 1996; 2006). Fraud increasingly emerged Act was enacted, simplifying offences and
on policy agendas because of concerns over the addressing weaknesses in the Theft Acts.
rising costs and pervasiveness of fraud, and
reducing police resources. In 2000, a consultancy The Fraud Review and anti-fraud strategies
report (NERA, 2000) for the Home Office argued Nevertheless, against the perceived rise in the
that discovered fraud could range from £5 billion cost of fraud and the decline in police resources,
to £9 billion and undiscovered fraud, additionally, most efforts to address fraud were increasingly
from £5 billion to £9 billion (the Home Office considered to lack coherence, co-ordination,
estimated that the total cost of crime to England common approaches and a commitment of
and Wales in 1999/2000 was around £60 billion resources. However, the DH approach suggested
[Brand and Price, 2000]). A year later, research a way forward. As the Interim Report of the
on behalf of the National Working Group on Fraud Review noted: ‘many government
Fraud, a committee representing police fraud departments and agencies deal with particular
squads, confirmed a general and continuing aspects of fraud. The “map” is very complex. But
decline in policing resources dedicated to fraud no-one pulls it all together. There is duplication
investigation (Doig et al., 2001). and overlap of activities and functions, and gaps
On the other hand, reforms were already with some problems going unaddressed. The
taking place at organizational and legislative next phase of the Fraud Review will include a
levels, either because fraud was an inevitable project to design a National Fraud Strategy for
aspect of the work of specific departments, the whole economy. It will be based upon a
concerns at levels of fraud, the demands of model that has already been developed and
external auditors, the need for a more organized implemented successfully in the National Health
internal response, or reviews to update legislation. Service’ (Fraud Review, 2006a, p. 4).
The Department for Work and Pensions (DWP) The work of the Fraud Review (2006b) took
has long had significant prevention and a primarily, but not exclusively, criminal justice
deterrence resources integrated into its work. Its approach, making a range of thematic and
current strategy, first issued in 1998, revolves institutional recommendations, including a
round implementing five main themes—prevent, comprehensive measurement of fraud,
detect, correct, punish and deter—and promotion of prevention good practice, fraud as
http://dx.doi.org/10.1080/09540962.2018.1407164
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a policing priority, and agencies to support enforcement organizations and the public, private
delivery. Integral to the approach was the national and voluntary sectors’ (NFA, 2011, p. 20).
strategy, which ‘should take a “holistic” approach,
focusing efforts and resources where they are Post-2011 strategies and other initiatives
likely to be most effective rather than most Ironically, the NFA’s 2011 announcement about
attention grabbing, and focusing on the causes of the proposed role for the NCA was revisited in
fraud as well as dealing with the effects. The December 2013 when the government
strategy will not replace existing strategies but announced the NFA’s closure. While the
rather will help co-ordinate ongoing efforts. government professed that the NFA had been
Such an approach is likely to emphasise upstream successful in raising awareness of fraud and
action to prevent and deter fraud, such as improving co-ordination, it believed there should
educating consumers and businesses on how to be a single national focus on cutting economic
avoid becoming victims. Despite these efforts crime as part of the government’s approach to
fraud will still happen and the strategy will have serious and organized crime through the NCA
to set priorities for downstream investigations ECC. Some of the NFA’s responsibilities became
and effective ways of punishing fraudsters and part of the City of London Police (CoLP), which
obtaining justice for victims’ (Fraud Review, had been proposed by the Fraud Review as the
2006b, p. 6). national lead force on fraud. Already responsible
One of its recommendations, the National for the National Fraud Intelligence Bureau
Fraud Strategic Authority (later the National (NFIB), which triages allegations of fraud into
Fraud Authority [NFA]), issued the national intelligence packages for police investigation,
anti-fraud strategy three years later (NFSA, 2009). CoLP also took over Action Fraud, the central
This proposed building and sharing knowledge fraud reporting body, from the NFA. The NFA’s
about fraud, tackling the most serious and local government work was handed over to the
harmful fraud threats, disrupting and punishing Chartered Institute of Public Finance and
more fraudsters, while improving support to Accountancy (CIPFA), which had also taken on
victims and the nation’s long-term capability to a number of responsibilities for public sector
prevent fraud. In 2011, the NFA worked with an fraud and corruption following the closure of
advisory group, the Fighting Fraud Locally the Audit Commission (Doig, 2014; 2017).
Oversight Board (FFLOB), to produce a local In 2015, the CoLP’s Economic Crime
government anti-fraud strategy. This proposed Directorate developed a draft National Police
the protection of ‘public funds through the Fraud strategy and a National Police ‘Protect’
creation of a positive incentive regime, the strategy. (‘Protect’ is one of the 4 ‘Ps’—Pursue,
removal of barriers to information sharing and Prevent, Protect and Prepare—that are the
by conducting a review of the use of powers by components of the implementation frameworks
local authorities’ (FFLOB/NFA, 2011, p. 6). for the UK’s strategies for terrorism, organized
The publication of the strategies was crime, and cybercrime.) These placed the
supplemented by further reviews of public sector emphasis on volume fraud and on organized
fraud, again emphasising the need to quantify crime or criminal networks; the latter would be
the cost of fraud, the role of intelligence, addressed through intelligence, investigation and
information-sharing and prevention, increased disruption by the NCA and regional police units.
collaboration, and more public–private sector The approach to volume fraud would be largely
partnerships (see Doig and Levi, 2013). A final, determined at local level, although supported by
over-arching strategy review was published by national resources, support and co-ordination.
the NFA in 2011 to ‘provide fresh impetus in our It would be primarily victim-focused, intended
fight against fraud’ (NFA, 2011, p. 4). While the to prevent individuals or organizations from
proposals included an emphasis on awareness becoming victims and supporting them if they
and prevention, and better use of intelligence, did.
collaboration and cross-cutting initiatives, the In 2011, the government introduced the
main focus was on fraud involving organized Localism Act which, while not directly relating to
crime and organized approaches to fraud, as fraud, mandated councils to promote and
well as a stronger institutional focus through the maintain high standards of conduct, as well as
Economic Crime Command (ECC) of the new requiring councils to have a code of conduct and
National Crime Agency (NCA). This would disclosure requirements for members’ interests.
address constraints on police resources by In the same year it also introduced a
developing ‘innovative, partnership solutions Transparency Code with the intention of
working across police forces, the NCA and its providing both mandatory and optional
Economic Crime Command, other law information, including categories relating to

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fraud, to help citizens hold their councils to parliamentary committees also scrutinize
account (see DCLG, 2011; Sandford, 2016). departmental work; other parts of the public
Between 2010 and 2014, the Department for sector, such as the police, are also subject to
Communities and Local Government (DCLG) external inspection.
made some £35 million available in two tranches
for competitive anti-fraud project bids, including A continuing cause for concern?
funding to the (renamed) Fighting Fraud and The concerns about fraud that led to the Review
Corruption Locally Board (FFCLOB) to update and the strategies continue. In terms of the cost
the 2011 strategy in the light of developments of fraud, research in 2007 sponsored by the
such as the national Serious and Organized Association of Chief Police Officers estimated the
Crime Strategy and the first UK Anti-Corruption overall cost of fraud in the UK at a minimum of
Plan. £12.9 billion (Levi et al., 2007). The NFA, whose
Issued in 2016, this new strategy’s remit included annual estimates of fraud,
recommendations included: produced its final report in 2013 with an estimated
overall cost of fraud £52 billion; the costs within
•Working groups to look for good practice and the public sector were £14 billion against the tax
‘quick wins’, as well as fraud and corruption system, £2.6 billion against central government,
enablers with a view to preventing more fraud £2.1 billion against local government, and £1.9
and corruption. billion against the benefits and tax credits system
•A focus on procurement fraud. (NFA, 2013). In 2016, a commercially-supported
•DCLG support in promoting good practice study estimated the figure to be £193 billion
and addressing housing fraud. (Experian et al., 2016); public sector fraud
•A structured programme on fraud and accounted for £37.5 billion; NHS fraud was
corruption awareness for elected local council estimated at £2.47 billion; and local government
members and senior managers. fraud was estimated at £7.31 billion.
Within such estimated figures, the reality of
It recommended that councils ensure the reported losses is, however, lower but still
provision of risk-assessed resources, work significant. The NHS received some 5,000 reports
together on counter-fraud hubs, horizon-scan of potential fraud and corruption in 2015/16; the
and explore new areas, for example cyber and total value of fraud, bribery and corruption
identity issues, and explore new methods to identified by NHS Protect and local investigators
detect fraud such as behavioural insights. following the successful conclusion of
For central government departments with investigations in that period was £6.5 million and
their own strategies, delivery continued to be the a further potential £25 millions’ worth of losses
primary focus. For example, much of DWP’s were under investigation. In its final report, in
work entailed developing and updating strategy 2013/14, the Audit Commission stated that the
implementation through pilots, proof of concepts, number of detected cases fell by 3% to just over
and adapting approaches, within the context of 104,000, while their value increased by 6% to
the five themes, and bringing ‘together fraud over £188 million; £129 million of which was
and error work that was spread across the housing benefit and council tax benefit fraud (a
department’ (NAO, 2015, p. 9). The NHSCFS 2014/15 report prepared by former Audit
had a dedicated staff resource, comprising some Commission staff stated that the £188 million
250 staff in nine directorates, one of which figure had risen to over £207 million). The
covered investigations with approximately 70 National Fraud Initiative* (NFI) reported that,
staff, including eight regional teams. It also between 2014 and 2016, identified fraud
accredited and liaised with local counter-fraud overpayments and errors amounted to £198
specialists (LCFS), which all NHS bodies had to million. In terms of benefits fraud where the
appoint (although not necessarily on a full-time DWP has been under continuous pressure to
basis). The requirement for anti-fraud and anti- improve its methodology, in 2015/16 around
corruption arrangements—currently part of the £1.6 billion was overpaid due to fraud. In 2017,
NHS Standard Contract documentation (termed the Cabinet Office reported that central
‘Standards for Providers’) since 2013—resulted
in all bodies having their own published policies
and procedures. For other departments the *Formerly run by the Audit Commission and now
housed in the Cabinet Office, the NFI is a data-
NAO has continued a general monitoring role matching exercise from both public and private
and, as a consequence of its parliamentary sector sources, sent as ‘risk’ matches to public bodies
reporting arrangements, invites scrutiny by the to be reviewed as potential frauds, overpayments
Committee of Public Accounts, while other and errors in public expenditure.

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government departments detected fraud worth is integrated into its general matching system
£73.6 million, and prevented fraud losses of £33 across its datasets. These are continuously tested
million, in 2015/16 (Cabinet Office, 2017, p. 6). through adaptive operating rules reflecting levels
If the cost of fraud was rising, then there of risk (by, for example, claimant type, claim
were also continuing concerns over public sector type, and level, type, newness and history of
responses. In 2016, the NAO noted that, for claims). Testing datasets and sharing datasets is
central government departments, levels of fraud undertaken both for fraud and for general
were often unknown and, without incentives or application, both within the DWP and with other
resources, there was poor reporting with gaps agencies, such as HM Revenues & Customs
and inconsistencies in information collection. (HMRC). All staff undergo fraud-awareness
There were unreported or undetected losses training and all work computers include a
and losses that were not being adequately referrals portal.
addressed, government departments were relied The DWP has three inter-connected and
on to manage fraud but had mixed capacity and fraud approaches: the Fraud and Error
capability ‘to understand and address fraud risks’, Prevention Service (FEPS), the Local Service
and there were limited means to evaluate ‘success’ Investigation (LSI) and the Central Crime,
(NAO, 2016a, p. 7). Intelligence and Investigative Service (CCIS).
Levels of police resource remained low FEPS and CCIS are national services. LSI is
(Button et al., 2014), as did the use of joined-up divided into two areas, north and south (north
anti-fraud working between departments (Doig ranges from Wales to the north east of England),
and Levi, 2009). Elsewhere it was argued that the and further organized into geographic groups
NHS anti-fraud work in some areas may not (for example London and the home counties)
have led to any statistically significant drop in and then districts, which are largely coterminous
levels of fraud (Tickner, 2015). In 2013, a DCLG with local authority areas. The staffing of the
minister told the House of Commons national services are, in the case of FEPS,
Communities and Local Government Committee approximately 1,500 staff located in four regional
that ‘the large majority of detected fraud had hubs. There are some 900 CCIS staff based
been identified by only a small proportion of regionally and locally, often located with LSI
councils and that 100 councils had detected no whose 2,000 staff is geographically located across
fraud at all’ (Communities and Local Government numerous sites, working in teams of around 10–
Committee, 2014, p. 42). 12. Nationally, some 5,000 personnel deal with
around 1.2 million cases annually, 10% of which
Public sector fraud in practice: a regional lead to criminal investigation and approximately
perspective 4,500 lead to prosecutions by the CPS; more
Given that fraud is, in terms of cost, persistence local north east figures are not externally
and patchy responses, a continuing issue, and published and, in any case, casework may be
that there have been—and are—a number of allocated around the country where and when
strategies and other initiatives to address it, this necessary.
paper reviews how far fraud is being addressed All cases, whether staff referrals, hotline
within the contexts of national and other strategies allegations from the public, referrals from other
by a number of public bodies and local agencies, or matches across the DWP databases,
government in the north east region. are managed through Central Referrals where
The research comprised desk reviews of they are enhanced (through, for example, social
official reports and academic publications, media and internal sources) and triaged toward
freedom of information requests and semi- four outcomes—no further action (around 20%
structured interviews with personnel from the of cases); to FEPS to ensure compliance because
north east police forces, internal auditors and there is no specific evidence of deliberate abuse
investigators working in the NHS and local or criminality; to LSI for investigation (although
councils, and senior DWP management. cases may be moved between it and FEPS
depending on initial findings); or to CCIS if
The Department for Work and Pensions there is evidence of serious or organized
The DWP operates a national remit in a dynamic criminality. Cases are distributed through
benefits environment, in terms of both the volume FRAIMS—the Fraud Referral and Intervention
of claims, and the interdependence of claims, as Management System—a single, nationally-
well as the impact of wider government policy, networked IT system that captures all fraud and
such as the introduction of Universal Credit compliance cases and their outcomes on one
(UC) to streamline and integrate the payment of system and allocates cases. The databases are
benefits. The DWP’s fraud-prevention approach enhanced by real-time information from HMRC

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on earnings and other income sources. had a related investigation or response plan and
Apart from HMRC and specialist links an anti money laundering policy. While a number
between CCIS, the police and the NCA ECC, the reported annually on fraud-related outputs, few
main sector with which DWP is engaged is local published monitoring or evaluation reports on
government. The proposal for UC includes implementation of a strategy. All referenced the
housing benefit, triggering off a plan for a Single NFI and all encouraged reporting of concerns,
Fraud Investigation Service (SFIS), a project benefit frauds and so on, by the public; most, but
where the ‘single’ referred to the merger of not all, had a published whistle-blowing policy.
council investigators and DWP’s existing LSI; Councils looked to CIPFA for risk, fraud and
the former were some 1,800 investigators working corruption guidance and training. Many councils
for local authorities to prevent or investigate were members of NAFN (the not-for-profit
fraud associated with the administration of National Anti-Fraud Network, which provides
housing benefit. While councils will continue to specialist services) and hold meetings with DWP,
process claims and administer housing benefit while housing benefits responsibilities rest with
until UC is fully implemented nationally, by late councils pending the full roll-out of UC and
2016 around half had transferred over. Councils because DWP data was relevant to council
also receive funding under FERIS (the Fraud decisions on, for example, council tax reduction
and Error Reduction Incentive Scheme), which payments.
offers financial rewards to local authorities who In relation to the Transparency Code, five of
reduce fraud and error in their housing benefit the councils appeared to have no online reference
cases by a range of initiatives, including publicity, to counter-fraud work among their Transparency
intra-council collaboration and data use or Code information and, of the seven who did,
encouraging reporting of change of only two had 2016 information and two were
circumstances. A further fund is available for undated. Not all information was presented to a
demonstrable results in reducing fraud and error, standard format, but it would appear that less
but the amounts involved in both instances are than 40 (or about 20 full-time equivalent [FTE])
not significant (and unlikely to continue if UC is staff were involved in fraud work at an estimated
rolled out nationally). cost of approximately £1 million annually. Only
two councils provided the optional information.
Local government In terms of those councils studied in more
The establishment of SFIS has invariably depth for operational issues, it was clear that the
impacted on councils’ capacity to undertake departure of staff under SFIS had a significant
fraud work because the staffing resource provided impact on staff resource. They were also adversely
councils with an inhouse investigative capacity affected by changes to the work of internal audit,
which, the Audit Commission estimated, was where fraud is no longer necessarily a mandated
dealing with up to 40% non-benefit fraud by part of planned audit work. This was added to by
2010/11 (see Doig, 2014). Nearly 50% of the the general disinterest of the private sector
DCLG competitive project funds had originally external auditors who had taken over the Audit
been earmarked for replacement staff (see Commission’s audit responsibilities, but not its
Communities and Local Government wider roles in relation to fraud and probity
Committee, 2014, p. 42). The decision to use it, arrangements. Two councils, losing 26 staff
and the other funding, for fixed-term initiatives between them, have or are in the process of
led to numerous projects involving data-sharing, establishing corporate fraud units with four staff
often between neighbouring councils. in each, based in or linked to the internal audit
Unfortunately, few of the councils in the north function as a central resource to co-ordinate
east were recipients, and nor has the DCLG fraud work across departments (here fraud work
undertaken any review from which they could has been hampered by the presence of multiple
benefit in terms of shared good practice internal processes and by specific departments,
elsewhere. such as social services and parking management,
The 12 north east councils mentioned the adopting their own audit and enforcement
2011 FFL strategy, but none have appeared to approaches where evidence of fraud or recovery
use the strategy or the associated checklist as an of funds may not necessarily be the main focus of
overall framework (although many delivered on their work).
a number of the proposals in the checklist). None
reported on how—or if—the council was The police
delivering the strategy. Hardly any mentioned At the regional level, the police approach to
the 2016 strategy. While all councils had a fraud organized fraud reflects the delivery of a number
and corruption strategy or policy, a lesser number of strategic objectives through the establishment

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of regional organized crime units focused on The National Health Service (NHS)
Level 2 (cross-force) organized crime, including A review into both the extent of NHS Protect
fraud. In the north east, the unit has about 100 responsibilities and perceptions of a continuing
officers drawn from the three local forces; five uneven relationship between NHS Protect, and
form the fraud team. Their cases come from one the DH and the NHS, resulted in several
of the three local forces or internally, followed by changes. In recognizing the absence of a
a formal management-tasking process that counter-fraud presence within the department,
manages both workload and criteria. The latter the establishment of a DH Anti-Fraud Unit
reflect the unit’s focus: offenders or inquiries (AFU) is underway. This will investigate fraud
involve cross-force work, complexity in terms of within the department and arms-length bodies
networks involved and financial structures, an outside NHS Protect’s remit, as well as agreeing
organized crime element, harm caused and/or workplans and priorities for the department in
vulnerable victims (in terms of the seriousness or terms of addressing fraud across the NHS.
persistence of the crimes or methods used), and NHS Protect has lost responsibility for security,
where the investigation of organized criminals which will become the responsibility of
may be best pursued through their fraud-related individual trusts, and has ended its roles in
activity because it presents ‘their principal learning support and training, and at regional
vulnerability from a law enforcement perspective’ and local levels (consequentially also losing a
(HMIC, 2015a, p. 60). number of staff).
Among the three local forces, the approaches As of November 2017, NHS Protect has
have been, as the policing strategies to combat been relaunched as the NHS Counter Fraud
fraud proposed, dependent on local policing Authority, accountable to the AFU. Assessing
priorities. One force had abolished its fraud fraud to be over £1 billion, the Authority has
squad some five years ago, but has now re- also launched a new three-year strategy that
established a fraud squad within a newly-formed will see it acting as an intelligence-led
cybercrime investigation unit. One has a long- organization providing a national overview of
standing economic and cybercrime unit located fraud, as well as focusing on complex cases,
within the specialist crime department. The third including those involving bribery and senior
force has a fraud unit located in the force’s major management (FIRST, its case management
crime sub-department within the special system, will be used by a Tasking and
operations department. Together they have less Coordinating Group to allocate cases). It will
than 25 fraud investigators. Each approaches continue to receive NHS bodies’ reporting on
NFIB packages differently—both in terms of anti-fraud and anti-corruption arrangements
intake, acceptance and reporting back, as well as under the Standards for Providers (part of the
who investigates cases within the force. Cases NHS Standard Contract) and now also the
investigated include internal or management Standards for Commissioners (such as Clinical
frauds, including book-keeping, mandate fraud, Commissioning Groups—CCG—which are
election fraud, public sector corruption, GP responsible for overseeing providers’ counter-
practices’ funds frauds, probate, carer and invoice fraud arrangements). It will undertake general
diversion fraud, romance scams, investment fraud awareness and risk work, provide LCFSs
fraud, and abuse of position of trust. with more intelligence, and information on
Only one force works primarily within the trends, as well as working with them to improve
CoLP Protect strategy; it will only take on one or performance through formulating strategies,
two cases a year after a serious case review for collaboration and partnership, and
which the main criterion is complexity in terms benchmarking and assessing local initiatives.
of, for example, multiple victims or accounts. It One consequence will see trusts and other
has developed its own fraud and problem-solving agencies taking more responsibility for local
plan around the Protect strategy and focuses its fraud and also the increasing employment of
work on support to divisions. The unit also LCFSs by NHS internal audit providers, many of
works with banks, community support officers, whom have combined into regional consortia to
the probation service and Trading Standards, to provide economies of scale, but also to service a
protect vulnerable, elderly and other victims range of trusts and other health services. They
and potential victims. will also have to respond as healthcare provision
None of the forces has significant joint becomes complex and complicated (for example,
working arrangements with or resourcing from a local CCG, the main budget allocator, might
the national level. Apart from operational matters, have hundreds of providers, from public, private
there is limited partnership working at the local and the third sectors) and where the accountable
level with other public bodies. agency—for example a local authority—may fall

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outside the NHS framework. to trained investigators and fraud awareness

The major north east NHS internal audit training, and measurable indicators (Cabinet
consortium covers at least three counties, Office, 2017, p. 25).
comprises six offices and 65 FTE staff, including This illustration focuses attention on three
six FTE LCFSs (and a newly-appointed head of questions concerning strategies and practice on
fraud) providing internal audit services to its the ground: why there appears to have been little
member organizations and, where these have progress on the recommendations of past
client organizations, as an inhouse client service, strategies and initiatives; why are some sectors
to more than 20 trusts and CCGs, with a combined returning to implement recommendations
annual expenditure of over £7 billion. The proposed some years ago or implementing
standard audit service days are purchased recommendations already delivered in other
according to the organization’s annual audit sectors but with no assessment as to their
plan (the days vary by organization) while anti- effectiveness; and why generally there is a gap
fraud is purchased separately and based largely between strategic objectives and the practice on
on the Standards for Providers requirements, the ground.
with days allocated according to its core The NAO provides two generally-applicable
components such as prevention and sanctions. answers that may be drawn from, first, its review
The inclusion of an anti-fraud capacity within a of central government department plans in terms
single organization will mean a shift in focus and of managing their overall activities and, second,
direction for both LCFSs and the consortium, from its review of central government
not least because the FIRST-derived profiles (for departments’ approach to fraud. In the first the
the second half of 2015 the more significant case NAO stated that: ‘problems in the delivery of
types were sickness, often involving working public services can be traced back to the way
elsewhere; overtime; avoiding charges by government makes decisions about how to
overseas patients; double working; travel and implement policy…the current approach
subsistence) in triggering expectations, amounts to a collection of top-down, set-piece
particularly by trust audit committees, of the processes and guidance…and not the
need to develop a more coherent and proactive overarching integrated framework for strategic
local response. business planning and management that
government needs’ (NAO, 2016b, pp. 6 and 10).
From strategy to practice on the ground: an For the second, also in 2016, it noted that, while
assessment the Cabinet Office was the policy lead for fraud,
In 2008, the National Strategic Fraud Authority’s it did ‘not have strong levers to direct actions as
national fraud strategy—proposing a better even “mandates” have to be negotiated and
knowledge of fraud, targeting the most serious agreed’ (NAO, 2016a, p. 35).
fraud threats, improved capability for prevention, The answers may also concern current
and measurement—was intended ‘to take permutations of, and delivery of, levers, co-
forward the Government’s response to fraud’ ordination and leadership. The Home Office’s
for which it claimed to be establishing ‘a radical Joint Fraud Taskforce continues to ‘encourage’
overhaul of the Government’s delivery the prioritization of fraud within police forces,
framework on fraud’ (NFSA, 2009, pp. 10, 14). as well as working on awareness and developing
The 2011 refreshment of the national strategy, fraud networks, while the Cabinet Office has
sponsored by a number of central government published counter-fraud organizational and
departments, including the Cabinet Office, investigation standards. CIPFA’s Counter
emphasised the ‘four priorities’ agreed by the Fraud Centre states it leads and co-ordinates
government’s Fraud, Error and Debt Taskforce: the fight against fraud and corruption across
collaboration; assessment of risk and local and central government, the health,
measurement of losses; prevention; and zero education and charity sectors while HMIC
tolerance (see NFA, 2011, p. 21). In 2016, the noted in 2016 that the NCA’s leadership
NAO was reporting that ‘the government lacks a function in terms of the quality of its strategic
clear understanding of the scale of the fraud action plans had, in the case of the ‘identified’
problem and departments vary in their ability to threat area of public sector fraud, yet to be
identify and address the risk of fraud’ (NAO, achieved (HMIC, 2016, p. 24). Further, the
2016a, p. 32). In 2017, the Cabinet Office was absence of a strategic cross-sector or national
proposing that central government departments perspective perpetuates, as the chair of
have a counter-fraud strategy, a fraud risk Committee of Public Accounts noted, more
assessment, a fraud policy and response plan, an generally (2016, p. 10), a compartmentalized
annual action plan, fraud detection work, access system that ‘seems impervious to attempts to

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break down the walls of the silos from which which resulted in a lack of performance
public services emanate’ (see also Doig and Levi, management and priority setting in relation to
2009). Part of the answer must also relate to the reporting and investigation of fraud’ (HMIC,
resourcing strategies. In the case of local 2015b, p. 67).
government, they ‘are dealing with In the case of local government, the abolition
unprecedented “budget gaps”—that is, a massive of the Audit Commission, the one—and central—
shortfall in resources resultant from the firm lever for anti-fraud work, prompted the
combination of funding reductions and cost 2011 FFL strategy to suggest that ‘local authorities
pressures’ (Hastings et al., 2015, p. 602) and, in and central government will need to look to
the case of the police, ‘the scale of these cuts was design new arrangements for the new conditions.
unprecedented and has required police services That will most likely require the greater sharing
to reconsider their priorities’ (Millie, 2014, p. of counter fraud and audit resources, the creation
52). of a new control framework and new institutional
Finally, part of the answer may lie within the arrangements, building on the existing shared
NAO’s proposals for an appropriate anti-fraud counter fraud infrastructure’ (FFLOB/NFA,
framework, including ‘clear strategies and 2011, p. 18). By 2016, however, the next iteration
governance; an effective, well implemented of the strategy was already noting that
control environment; and an ability to measure ‘the capacity to tackle fraud and corruption was
and evaluate performance’ (NAO, 2016a, p. 5). likely to be reduced, or had already been reduced,
Organizations, especially in the absence of firm as a result of austerity-related local authority
or strong levers and in the current climate of funding reductions’. In terms of the expectations
budget restraints and competing policy agendas, of the 2011 strategy, it reported that inter-
may opt for limited, specific technical or control organizational collaboration and data-sharing
responses rather than wider governance was making slow progress because counter-fraud
arrangements to develop an organizational anti- work was not consistently prioritized and there
fraud culture; ‘specific anti-fraud activity is was a lack of financial incentives to make the
augmented by all-embracing governance business case, because of a lack of understanding
contributions for risk management, internal of data protection rules, and because of a lack
audit, information governance, ethical standards of funding. Also, with staff resources reducing,
and corporate governance, which are all elements there were no funds to train new staff, while
towards the creation and maintenance of an ‘senior managers were finding it difficult to
antifraud culture’ (Marks and Melville, 2012, p. dedicate sufficient time to demonstrate their
78; see also Doig, 2014; 2017). Taken together, support for counter-fraud activities due to the
the answers to the questions may not only focus being on other priorities such as meeting
highlight the various inhibitors and facilitators budget savings targets and maintaining key
that explain differential responses across sectors services to residents’ (FFCLOB/CIPFA, 2016, p.
but also the likelihood of a continuing gap 15).
between strategies and practice and whether At the next level, those with existing sector
current responses will, belatedly, begin to bridge strategies but subject to continuing change to the
the gap. implementation context, including the reduction
At the level where local discretion and of resources, such as the NHS, the commitment
decision-making are paramount in terms of to the resourcing of anti-fraud work, particularly
implementation, there is often a noticeable at local level, has been diminished but may be
divergence between strategy intention and mitigated with the integration of that work within
practice as a consequence of individual audit arrangements. The proposed changes at
organizations determining their own approach the DH and NHS Protect remain in progress
or interpretation. For example, to achieve the although a 2017 police review of the latter’s
police fraud strategies at local level, the National investigations has already warned of the need
Police Co-ordinator for Economic Crime had for a much more directional role across a
advised all police forces in 2015 that they should range of operational areas at local level in
have, among other requirements, an identified support of the national strategic objectives. In
lead at senior management team level; and an addition, the capacity and commitment of
accountable chief officer to monitor and manage CCGs to oversee the anti-fraud, bribery and
performance (see HMIC, 2015b, p. 73). The corruption arrangements in place within
HMIC review noted, however, that many forces providers has also yet to be tested. Further, the
failed to assess the impact of fraud within their increasing autonomy of NHS foundation trusts
force strategic assessments and that ‘there was an means that fraud compliance and enforcement
absence of strategic leadership and direction, capability may increasingly influence a trust’s

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risk appetite to address fraud which, in turn, Conclusion

may sit uneasily with the primacy of patient care The findings from the research suggest that,
and the work of professional staff (in a way that since 2006, the strategic approaches can only be
is not reflected in, for example, HMRC or DWP considered in terms of practice on the ground as
in terms of the active pursuit of tax or benefits a work-in-progress, providing guidance rather
fraud). than an enduring framework, with different
Finally, those with organizational organizations adopting specific components for
strategies and with enduring oversight (and specific purposes, rather than using the
where the NAO applies generally-applicable framework for a joined-up and coherent
baseline criteria such as those used for its approach to fraud, internally and externally.
fraud stocktake reviews) appear to have the This is further exacerbated by the absence of
potential for deliverable or successful additional resources, and by national leadership
implementation. In its 2015 fraud and error or oversight on rolling out good practice, or
stocktake for HMRC and DWP, the NAO ensuring the more cultural and governance
noted that both had a joint strategy which arrangements to facilitate an anti-fraud
identified a common approach and organizational environment.
overlapping areas, as well as pursuing their For fraud prevention in the UK, the interplay
own programmes and targets. Both had between national strategies and organizational
strengthened their governance priorities, within a context of budget reductions
arrangements and were using data to and other, often competing, agendas, remains
improve their understanding of the causes an unending story. Both the rhetoric and the
of fraud and of targeted interventions, but recommendations of the strategies in place may
both had still to improve delivery of their be—or are—necessary, but there are not yet the
strategies, design fraud and error responses necessary or sufficient conditions for actual
into core processes and strengthen operational implementation work, and certainly
measurement of performance (NAO, 2015). not where gap-closing features noted above are
The possible explanations for, and absent. There is also a continuing absence of co-
consequences of, the divergence between ordination between reforms at central/local levels,
national strategies and initiatives and practice and continuing mismatches between the potential
on the ground should not deny many for fraud at local level and the institutional
examples of local and regional interventions. arrangements to address them.
On the other hand, they do emphasise not Despite the best intentions of fraud strategies
only the differential approaches but also and policy initiatives in the UK, and while there
that the resolution of the gap may, in terms is much ad hoc partnership working, joint working
of sector or organizational priorities and and information-sharing, there is a general
especially resources, be difficult to reconcile identifiable dis-connectedness and potential
in the short term. In many ways the current dysfunctionality at national level as a consequence
situation reflects the issues that prompted of the absence of resources, clarity of priorities
the establishment of the 2006 Fraud Review and leadership or oversight that can be translated
and a number of its recommendations, and into institutional, procedural and resourcing
in particular the establishment of the NSFA/ implementation on the ground that effectively
NFA and the strategies. Here the value lay addresses a persistent and costly area of concern.
not just with the strategic objectives but also
with the role to review and report at six- References
monthly intervals on activities and the Brand, S. and Price, R. (2000), The Economic and
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national level. DCLG (2011), The Code of Recommended Practice for

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IMPACT
This paper has universal applicability in reviewing the objectives of anti-fraud strategies drawn
up at national level, and the practice on the ground, using a bottom-up perspective to assess
how national approaches are—or are not—implemented. It highlights the questions of
continuing ownership of the strategy, sector or organizational frameworks, other priorities
and agendas, budgets and resourcing and measurement of progress before asking the effect
those aspects have on implementation. It uses a UK region as a case study in the context of the
2006 UK Fraud Review and the various consequential anti-fraud strategies and initiatives for
national and local levels. Noting the continuing concerns over the costs and pervasiveness of
fraud since 2006, as well as over differential responses to the implementation of strategies, the
research for the paper provides insights from below into the commitment to the strategies and
initiatives, organizational discretion, availability of resources, evidence of progress, and the
impact of other agendas and issues, such as austerity and what the National Audit Office called
‘firm levers’. The paper suggests that the interplay between the aspects, concerns and insights
noted go some way to explaining why much of the intention of the Fraud Review and its
recommendations has yet to be realized. It also underlines more generally the need for
strategic oversight, the importance of resources, implementation frameworks, and performance
and progress measures, without which any strategy is unlikely to succeed.

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