Government has a legitimate interest in seeking to prevent and reduce error in the benefits system and in taking action to recover funds lost. And there is widespread pressure for the Department for Work and Pensions to do just that. However, creating systems capable of doing this work is fraught with challenges, including in terms of maintaining fairness and legality. Chief amongst them is the complexity of undertaking error detection work at the scale necessary for effectiveness without harming benefit recipients, who are often vulnerable and for whom benefits are an essential source of financial support. Such challenges are also magnified when, as is typical in modern government, techniques such as outsourcing to private companies and risk assessment are adopted.

The Department’s recent paper on Fighting Fraud in the Welfare System sets out how Targeted Case Reviews will become a central technique for its work in this area in the coming years, and it is investing accordingly. It is initially spending approximately £450 million—half of its additional allocated funding for counter-fraud activity—on these reviews, with an ambition to review 2 million cases in the next five years. A team of 887 reviewers has already been assembled, with further reported plans to expand the team to almost 6,000 staff, including through outsourcing to the private sector. The Department estimates that it will manage to save £750 million through conducting Targeted Case Reviews—an estimate which rises to £6.4 billion if funding for the work is increased for the next three years.

Targeted Case Reviews begin, as their name suggests, with some targeting. Specifically, the Department uses a risk-based system to assess all Universal Credit claims older than six months. This system suggests a sample of cases for review, which it deems are most at risk of containing errors or fraud. It is not, at present, very clear how this process operates. Once a review commences, the claimant is informed and asked to provide evidence to verify their claim is genuine and correct. An interview also takes place, either in person or over the phone, which is said to take around 90 minutes usually. Claimants who do not engage once selected for a Targeted Case Review will have their benefits suspended.

If an error of overpayment is detected, changes are made to the benefit, potentially with previously paid funds recovered through deductions to continuing benefit payments. If the error is underpayment, then the benefit is increased. The latest data shows that, of the 25,000 or so claims reviewed thus far, 7,600 (30.4%) revealed overpayments, and 240 (0.96%) revealed underpayments. If fraudulent activity is detected through the review process, the case is passed to the Department’s counter-fraud function. Failure of the claimant to respond to the Department is sufficient to trigger a referral on suspicion of fraud. 

While the aim of this exercise might be legitimate in general terms, there are clear risks in the Department adopting the Targeted Case Review technique. It goes without saying that the sheer scale of the exercise—reviewing up to 2 million welfare recipients—means that any systemic process deficiencies are likely to be widely felt and have broad impacts. Equally, the nature of what is being reviewed—benefits being so central to the lives of people who rely upon them—means that even a review that ends up maintaining or increasing someone’s benefit levels is likely to cause some distress. Engagement with the process will certainly create an administrative burden for claimants, many of whom are vulnerable. 

Moreover, the types of processes being adopted carry risks. For instance, only a few years ago, there was a high-profile scandal involving Concentrix undertaking outsourced tax credit reviews. Similarly, systems that seek to predict risk and direct the attention of public officials to certain individuals might be becoming more common, but they also possess risks in terms of both fairness and legality—as the Home Office found out when it tried to adopt similar tools for visa processing, was judicially reviewed, and subsequently dropped them. More broadly, the extent to which this type of targeted suspicion affects this vulnerable population’s sense of fair treatment remains to be seen.

None of this is, of course, to pretend that we have a crystal ball and are in a position to suggest that Targeted Case Reviews are a scandal waiting to happen—it is possible to undertake checks for errors well. Nor is it to suggest that outsourcing or the use of risk assessments to direct resources are inherently bad ways to administer law and policy. Nonetheless, it is important not to lose sight of the fact that the Targeted Case Review process is, by its nature, unavoidably intrusive and burdensome, and it demands the maintenance of the highest standards of fair process. Fair process is in the interests of those subject to Targeted Case Review, but also in the interests of the Department itself, if it hopes to maintain the legitimacy of this exercise in the coming years. 

Joe Tomlinson is Professor of Public Law at the University of York.

Eleana Kasoulide is a PhD Candidate at the University of York, where she is also a Research Assistant.

Jed Meers is Senior Lecturer in Law at the University of York.

Simon Halliday is Professor of Socio-Legal Studies at the University of Strathclyde.

(Suggested citation: J. Tomlinson, E. Kasoulide, J. Meers & S. Halliday, ‘Targeted case reviews: a legitimate compliance exercise or a scandal in the making’, U.K. Const. L. Blog (23rd October 2023) (available at https://ukconstitutionallaw.org/))