 |
answer text |
<p>The Department was recently requested to set out the steps it has taken to reduce
the costs of fraud in the last three financial years: this response is provided in
the Annex below. The Public Sector Fraud Authority (PSFA) defines the difference between
fraud and error in relation to the dishonest intent of the individual or organisation
involved in the incorrect payment. “Fraud” represents losses to the Department caused
with intent by a counterparty. “Error” represents losses to the Department where intent
cannot be proven. As the difference between fraud and error relates to the established
intent of the counterparty rather than the activity itself, the Department has a single
controls and assurance regime over fraud and error, which is set out in the Annex
below.</p><p>In addition, the Department operates business-as-usual transactional
and analytical controls to mitigate and detect risk of financial error caused by administrative
errors.</p><p> </p><p>Annex A – Parliamentary Question 22574 To ask the Secretary
of State for Transport, what steps his Department has taken to reduce the costs of
fraud in his Department in the last three financial years.</p><p> </p><p>Response
provided on 23 April 2024</p><p><strong> </strong></p><p>Since the establishment of
the Public Sector Fraud Authority (PSFA) in 2022, the Department has been working
closely with PSFA to implement the Counter Fraud Functional Standard framework, a
common set of standards required by government departments to counter fraud, bribery,
and corruption. To support compliance with the Functional Standard, the Department
internally published its Counter Fraud, Bribery and Corruption Strategy for 2022-2025
to improve culture and awareness and build on the counter fraud activity delivered
since the launch of DfT’s first strategy in 2019.</p><p>The following key activities
have taken place to drive improvements in reducing fraud by improving detection activity,
enhancing fraud prevention and building capability.</p><p>To support detection activity
the department utilises Spotlight, a due diligence tool provided to departments by
the Cabinet Office to help identify areas of risk and potential fraud and error. The
department has also commenced a data analytics project utilising artificial intelligence
to identify instances of fraud and error within high-risk spending areas. This initiative
is providing comprehensive insights into fraudulent activities and errors that can
be used to further strengthen controls and seek recovery of funds where fraud or error
is identified. The Department’s contract management teams have furthermore increased
their focus on fraud risks and detection, resulting in substantial sums recovered
and returned to the Exchequer. Detected, prevented and recovered fraud is formally
disclosed to the Cabinet Office who report publicly on these results across government
in their annual Fraud Landscape Report.</p><p>On fraud prevention, a Fraud Risk Assessment
(FRA) policy was introduced to enable accountable officers across DfT to take responsibility
in ensuring that fraud, bribery, and corruption risks are adequately understood and
effectively managed. The FRA process has been embedded into business-as-usual activity
and has supported the department in identifying fraud risks, driving control improvements,
and fostering continuous improvement in fraud risk management practices.</p><p>To
build capability DfT has increased its engagement with the PSFA to enhance oversight,
prioritisation of risks, delivery against counter fraud functional standards and sharing
of best practice. We have increased our collaboration across the departmental group
and across government networks to share lessons learnt, horizon scan for new and emerging
trends and deliver collaborative best practice workshops, training sessions and awareness
campaigns on areas of development e.g. risk assessment.</p><p>In 2023 and early 2024,
DfT was one of the first departments assessed under the latest framework by PSFA for
compliance against the Counter Fraud Functional Standard. The Department is now working
with PSFA to take forwards the recommendations from this review to drive further improvements
in the Department’s counter-fraud function.</p>
|
|
