The Chief Internal Auditor submitted a report, in order to present to Members for review and consideration, a status report on the progress made to date on the National Fraud Initiative (NFI) 2014.

She explained that the NFI had been run every 2 years since 1996, and to date, has been used to identify fraud and overpayments totalling over £26m in Wales.

Since the abolition of the Audit Commission in March 2015, the NFI had become part of the Cabinet Office, which is now co-ordinated in Wales by the Wales Audit Office in collaboration with equivalent bodies in England, Scotland and Northern Ireland.

The Chief Internal Auditor added that data was last submitted by the Council in October 2014, with the results being released in January 2015. Council Tax data was submitted separately and matches were released at different dates. Two reports were issued in 2014, in April and December of that year.

In respect of Creditor Matches, she explained that in recent years, Internal Audit had undertaken specific reviews of the AP Forensics system and deemed the matching exercises it performs to be superior to those undertaken as part of the NFI. Furthermore, it was worth noting that the daily checks performed were proactive as opposed to the NFI ones which related to a historical point in time. In April 2015, the Corporate Director - Resources gave approval for the NFI matches specifically in relation to creditors to no longer be investigated, as reported matches would have already been identified, investigated and where necessary corrected via the internally generated matches.

With regard to Payroll to Creditor Matches, the Chief Internal Auditor advised that as part of the 2015/16 Internal Audit Plan, it was agreed that as a one off exercise Internal Audit would review the recommended Payroll to Creditor matches. Whilst in itself this did not cover any issues and all matches were deemed genuine, it did cause questions to be raised by one service area about the need for Departments to maintain declarations of interest for their staff, with appropriate advice being provided.

The next part of the report referred to Housing Benefit Matches, which identified that the current NFI exercise had identified 1,257 matches in relation to Housing Benefits, compared to 1,985 in the 2012 exercise.

The Chief Internal Auditor then referred to Concessionary Travel Passes, confirming that for a number of NFI cycles, large volumes of matches had been identified in

relation to Concessionary Travel Passes. Resource implications and a change in

personnel this year has meant that only a small number of the matches have been

reviewed. The purpose of these matches is to appropriately cancel the Concessionary Travel Passes of individuals that appear on the DWP deceased list, for whom the Authority has not already been notified. Whilst there is a compensating control in that all passes contain a photo of the pass owner, this control is only as good as the check the driver performs when a passenger gets on the bus. The ultimate control is the deactivation of the pass thus preventing it swiping when attempting to be used on a bus. Given the ongoing high number of matches, it was anticipated that Internal Audit would undertake further work in this area in the future.

She then referred to the last section of the report and Council Tax Matches. These were fairly lucrative the Chief Internal Auditor advised, as from these was derived a single persons discount (of Council Tax). She added that from the December 2014 report, £34,195 of incorrect discounts had been identified and stopped to date, of which £24,309 was deemed to be recoverable.

A Member asked in terms of a single persons discount in Council Tax, if after these were claimed by the single people in question entitled to a rebate, if anything more was done after this to ascertain if the persons circumstances had changed, ie they got married, and were therefore no longer entitled to receive such discount.

The Chief Internal Auditor confirmed that unfortunately there were insufficient resources available, to check situations such as this in their entirety. A lot of reliance was therefore given to single people coming forward and confirming that their circumstances had changed if they had become married, or were 18 years of age and no longer permitted to claim a discount. There were spot checks however carried out by staff, but not more than this usually speaking she advised.

The Chief Internal Auditor confirmed that she would obtain this information and pass this onto the Member outside the meeting.

RESOLVED:                     That Members considered and noted the NFI update report.