Data Matching - Prevention or Detection of Crime

I have read the report mentioned in the response to this enquiry and it does not provide the information that was requested.

You can check for yourself by looking here:

http://www.audit-commission.gov.uk/local...

All data matching by the Audit Commission is governed by a statutory code of conduct. This says that there should be no assumption as to whether a 'hit' results from fraud, error or 'other explanation' until there has been an investigation.

In respect of the electoral register, this is matched against data base entries of whichever firm the Council pays to administer Council tax. It would appear that where a person on the electoral register is not on the data base the Commission flags this up and categorises it as a 'high risk' case, by which it seems to mean that between 1% and 40% of the cases on the hit list will turn out, after investigation, not to be entitled to the amount that has been deducted from their bill.

The fact that a case is flagged up as a match does not mean that there is lack of entitlement, or that there is evidence of a false claim by the taxpayer, or that the taxpayer 'is making' a false claim, or that the taxpayer has failed in the statutory duty to inform the council of any material changes in circumstances.

I found this out by asking the Audit Commission.

Therefore, there is a sense in which it cannot be said that the data matching in itself identifies fraud, or even potential fraud, defined as 'lack of entitlement'.

Councils are expected to investigate these matches, eliminating innocent cases 'in order to focus on the guilty ones'. In this way, the Audit Commission is helping Councils to detect fraud: it sends them a set of cases in which it believes there will be some frauds and requires them to investigate until it finds them. Councils have targets in terms of the number of investigations they must carry out, so the whole thing works to improve the performance of councils.

Unfortunately, lots of innocent entitled people have 'high fraud risk' flags attached to them. But it would appear to be considered that this is 'proportionate'.

I hope this is helpful.

You should also realise that the Audit Commission accepts that the accounts of this discount in a number of published reports and guidance booklets are 'incomplete' whereas they could reasonably be described as 'wrong' and 'seriously misleading' mostly in terms of the way they unfairly portray the nature of the discount.

The Audit Commission has so far declined to publish corrections or amendments to this 'incomplete' information, some of which was circulated to council audit departments which may - sadly - rely on it as providing an accurate account of the legal situation.

Therefore, any Audit Commission claims that particular facts may be ascertained from its publications should, in my view, be treated with extreme caution.

Another factor is that estimates of additional income identified appear to be based on guesswork about the number of cases where there will turn out to be lack of entitlement, and do not take into account the costs of investigations or the additional costs of trying to ensure that the council tax resident lists are 'up to date'. Nor do they take into account the fact that some people ought to have been claiming second adult rebates or benefits instead of the Section 11 discount and so on.

Claims that this discount 'costs' local authorities money are equally to be doubted on the basis that this is a misuse of statistics. Councils do not 'pay' these discounts. Moreover, a person living alone makes far fewer demands upon the council that households where large numbers of people live: this too should be taken into account. People who currently lose as much as 5% of their annual income on council tax would also be eligible for benefits and so on if they had to fork out the full amount.

I hope this helps you to interpret the document to which the NFI have referred you more fairly. I do not intend to rant!

It may also help you to interpret these documents if you realise that there is no such thing in law as a 'single occupant discount' as this term is commonly understood. Moreover, any council which deducted the amount on the basis of any head counting followed by subtraction of disregards ( ie single occupancy for council tax purposes with some people not counting) would be in breach of the statutory instructions requiring it to operate on the basis that the same rate and amount (obviously) will apply for the remainder of the year. Not enough people understand this, though the statutory content of the annual demand notice makes it reasonably clear.

It is almost routine for councils to provide misleading and unfair information of this discount, and to represent people as 'claiming to live on their own' when those people are not claiming any such thing.

It is easy to make the assumption that if more than one person is living at an address where the discount has been deducted they must have lied: this is total nonsense and in my view councils that encourage this belief whether through letters to taxpayers or through press releases are acting unfairly and unreasonably.

However, some councils argue that they have a statutory duty to do whatever they like if they think it will lead to an increase in income one way or another. This would include spreading public misunderstanding and so on. The idea that citizens have a right to clear and fair explanations of what is being done in their name appears to be dead, if, indeed, anybody ever did have such an idea! Again, I write to help you interpret information about this match put out by participants, and not to 'rant'.

I hope you find this helpful.

Thanks for the notes. I realise that the answer may not have been in the documents, however the information I was looking for was.

With respect, you asked how much fraud had been identified 'as a result' of data matching using the electoral register. I believe that it is important to stress this fact because thousands of people get tagged by the Audit Commission as 'high risk cases' using this data match every year. The statutory Code of Conduct explicitly states that there is a need for 'transparency' and in effect gives people a right to know why their data is matched and the reasons for each match. When people wrongly imagine that this match shows fraud or lack of entitlement they are wrongly imagining that thousands of innocent entitled people on the NFI hit lists are not entitled to the discount they have been receiving. This is not true.

This is a case where almost dogmatic insistence on totally incorrect ideas seems widespread. I believe that the frequent use of the ambiguous term 'single person discount' a term which appears nowhere in the law, is to blame for this. There is no such thing as a single person discount as this term is often understood. Another reason for the misconception is the equally inappropriate use of the term 'claim' as if this tax allowance were like a benefit. Benefits are awarded on the basis of claims as to facts made by people. People on benefits must inform if the circumstances giving rise to entitlement change. They continue across years so long as the rules and the circumstances remain the same. Too many people assume that the Section 11 discount is like this. The data sets required from Councils tend to confirm this misunderstanding. Indeed, there is evidence that many local auditors and some Audit Commission staff do not understand this important distinction.

A third source of misunderstanding arises from the Code of Practice definition of a data match as occurring when there is an 'inconsistency'. We need to be clear that this match does not indicate that there are facts inconsistent with any claim and it does not indicate that there are facts inconsistent with entitlement.

The report does not tell us how much fraud had been identified using this match or this document as it is simply not possible for this match to identify fraud.

Fraud arises when a person has either lied or withheld the full truth in order to gain. One cannot tell that a person has done either in respect of their Section 11 discount by looking at the electoral register and comparing it with the data sets sent in by the council. These data sets do not represent claims being made by people. To make this clear, any council that attempted to take a case to court based upon the contents of this data set would not get past the first hurdle.

A Section 11 discount must be deducted when all adults in the household except one fall to be disregarded. There is a long list of adults who fall to be disregarded. There is no law to say that council tax departments must keep up to date lists of who lives at each house and whether each of those adults falls to be disregarded. It is perfectly possible for a person to be entitled to a single person discount when ten people are on the electoral register when they are not on the lists kept by Revenue Services. For the sake of clarity, I emphasise that the householder would be entitled to the very same discount. Unlike a benefit, the person does not have to inform the council that somebody new has moved in or that a person has reached adulthood unless that person counts for council tax purposes. By law, the council, once it has done whatever it thinks is reasonable to ascertain whether there is entitlement, MUST base its deductions and calculations upon the statutory assumptions that the same rate and amount will apply for the rest of the year. The council is twice forbidden by the law to assume that the same people will be living in the dwelling. Not once but twice. The same set of laws also says that the taxpayer must inform the council if he or she is not entitled to any discount or if a lower rate should apply. A mere change of detail in the people who live in the house does not matter and does not need to be informed.

So this match does not indicate fraud because a) it does not show that a person is not entitled and
b) it does not show that a person has lied in the first place or subsequently failed to disclose material changes in circumstances.

Therefore, whatever information may be contained in the report to which the Audit Commission referred you, it does not and cannot state that any amount of fraud was identified or found by matching data. Matching data cannot in itself identify fraud in any matching exercise. This one cannot even provide prima facie evidence of lack of entitlement.

When the report says on page 6 that a new match including the electoral register looks set to increase revenue by a certain amount this is guesswork.

It says on page 16 of the report

A full council tax bill assumes that there are two
adults living in a property. If only one adult lives
in the property they can claim a council tax
single persons discount of 25 per cent.
Nationally these discounts are being received
by over 7 million householders, costing
councils over £2 billion each year.

This is nonsense. An adult living alone may well be able to claim a discount of 50%. The 25% discount is provided by Section 11, which is quite simply not a discount for people living alone ie sole residents. The claims about the money this discount costs are also misleading. You must understand that NFI reports are not meant to be factual academic documents but are biassed publicity documents. You cannot rely on them for professional standards of accuracy and fairness.

The next statement is also extremely misleading. It says

By matching council tax records against the
electoral register, it was confirmed that there
were grounds for suspecting significant abuse
of the single persons discounts. This exercise
has enabled the council substantially to
increase its present and future tax base. The
consequent increase in revenue is likely to
exceed £3 million.

This is simply wrong. This comparison could not 'confirm' any such thing. It provides no evidence at all. The actual logic is quite different. In my view the Audit Commission ought not to publish such misleading documents, but it is not particularly careful to check that its publications reflect 'the truth'.

Again, note that the possible not the actual extra income is given. We have no way of knowing how this estimate was arrived at. As many as 99% of the cases on the hit lists may have been fully entitled to the discount.

The report then mentions Croyden, but does not state whether the cancelled matches were taken to court or not, which is what you asked.

The next section makes it absolutely clear that this match is not based upon showing lack of entitlement as it admits that it aims to prevent fraud occurring in future even though there is no evidence that a lack of entitlement has yet taken place. This should thoroughly disabuse all of the idea that when the Audit Commission says there is a 'match' it does not mean that there is lack of entitlement or that there has been a lie.

It seems possible that the Audit Commission works on the assumption that local councils carry out annual canvasses of council tax. In the old days people were sent 'claim forms' prior to the calculation of the bill every year, or at least every other year. Ironically it is auditor pressure to achieve Gershon efficiency savings that has stopped councils from doing this. This means that there is no way that the contents of the data bases can fairly be said to represent any 'claim' made about who lives in their house at the time of matching, and that suggestions that the matching shows fraud are grossly unfair and inaccurate.

The amount of offense and distress caused to innocent people by investigators who are ignorant of the actual administrative rules governing Section 11 discounts cannot be underestimated.

In effect, large numbers of people are being suspected of fraud and required to eliminate themselves from investigations that they are in despite a complete lack of evidence. They are suspected of being guilty and have to prove their innocence.

You have to understand that the basis for suspecting that there might be fraud is not evidential but statistical.

I hope this helps.

I know that the Code of Practice says that where a match is found there is an 'inconsistency' that requires investigation. The Audit Commission uses the term 'inconsistency' in an unclear way. It is in fact not easy to know what they mean by it. I believe they ought to stop using it as it misleads people left right and centre including its own regional advisers, at least some of whom imagine that the electoral register can be used to discover people who are not entitled to a section 11 discount. This is arrant gibberish of course. Sadly, these people have the job of advising local authority investigators, some of whom are temporary staff brought in on short term contracts or even external firms brought in under privatisation rules. They often have no idea what the matches mean either.

The actual logic involved with the electoral register match is that some people stupidly put people on the electoral register who do count for council tax purposes. By systematically investigation all the people on the hit lists and making them eliminate themselves from the investigation the councils end up with lists of people who are more probably fraudulent.

The good practice suggested by the Audit Commission to judge from the web sites of the councils in question is in some respects offensive and unenforceable. For example, councils have a statutory duty to deduct the appropriate amount and cannot in law refuse to do it if an applicant will not sign to say they can come and look in his house any time they like. Any council that issues bills for money people do not owe is breaking the law and people can go to a tribunal to ensure that they get their money back. Again, it would appear that lack of proper thought underpins the Audit Commission's thinking.

I hope you find this helpful.

I have seen no evidence that the Audit Commission actually gets information about prosecutions or cautions. Cautions and interviews under caution as per the TV adverts come in under benefit rules. This is not a benefit and none of those rules apply. If theyp did nobody would be able to interview a person just because they were on an Audit Commission hit list.

That most certainly would provoke a public outcry, since there is not one shred of evidence against the people on those lists.

My local authority has sent me a form stating that I am required to give the names and moving in dates of any new occupants should I want to notify that section no longer applies to me. Also saying a penalty of £70 (or more)can be taken if I fail to give such information. I had a hunch that they are not so entitled and wonder how widespread such practices are. This seems to me to be a worrying trend of threats to citizens. I should not need to do Internet searches to protect myself from such.

It may that you have grounds for a formal complaint against your council here.

The Council needs to know who is liable to pay council tax. If you are the owner occupier, then you are the only liable person, full stop. The Council cannot fine you for ignoring such letters, so long as nobody who has moved in is liable to pay.

Councils often do misquote the circumstances in which they can issue civil penalties, sometimes, it would appear, as an intimidation technique. Sometimes they use the same sorts if intimidation used by police on suspects against people by letter. Remember that in effect, council tax collection has in effect been reduced to an exercise in fraud investigation because this is much cheaper than sending out annual canvass/claim forms. So often, it is a waste of time complaining when they send you false or misleading information because they feel entitled to do it if they are investigating you in search of a crime. They feel entitled to intimidate and threaten you. The Audit Commission routinely labels thousands of innocent people as 'high risk' frauds on the grounds that they are claiming a 'hot spot' high risk discount, with 'high risk' probably starting at very low percentages and astonishingly low financial losses, especially when compared to the billions lost in tax evasion or won because people don't claim benefits they are entitled to. But it is still worth complaining, as this is a democracy and in theory councils are accountable democratic organisations, and not the STASI.

For a guide to who is 'liable', look here

http://www.local.communities.gov.uk/fina...

If for example a man and wife jointly own their house they are jointly and separately liable to pay. If the husband won't, the council can chase after the wife.

Councils may try to bully you into providing information. Their problem is that the Audit Commission, for reasons that are not unclear but which probably arise from lack of appropriate research, insits that councils send them data sets including the names of every person who lives at an address and various other information. In the face of all reason, the Audit COmmission asserts that councils that do not have this information are not doing their job properly. This is nonsense, but the Audit COmmission has the power to assert this against councils publicly, so Councils are afraid, very afraid, as it were. My honest belief is that some councils have beenb misled by misleading information (admittedly) published by the Audit Commission in 'guidance' documents. It is a mess. We are the victims stuck in the middle.

You have no duty at all to provide such information to a council, unless the person counts as a liable person. If of course you are no longer entitled to the 25% discount, you do have to tell the council about this, but nothing requires you to give the names of the people involved, unless of course, they are actually liable to pay the bill.

Yours in opposition to unlawful and unfair evidence free suspicion.

Use the word 'harassment' in your reply and see what the response is.

If you look online you can check this out. It does seem clear to me that they are confusing cannot with will not in respect of your discount.

I hope I have not confused you, but I do not think I have.

SCHEDULE 3

(3)
Regulations under this Schedule may include provision— .
(a)
that any person appearing to an authority to be a resident, owner or managing agent of a particular dwelling shall supply to the authority such information as fulfils the following conditions— .
(i)
it is in the possession or control of the person concerned; .
(ii)
the authority requests the person concerned to supply it; and .
(iii)
it is requested by the authority for the purpose of identifying the person who, in respect of any period specified in the request, is or will be the liable person in relation to the dwelling; .
(b)
that the information is to be supplied within a prescribed period of the request being made and, if the authority so requires, in a form specified in the request; and .
(c)
that a request may be served on the person concerned either by name or by such description as may be prescribed.

Penalties

Failure to supply information to or notify billing authority

1
(1)
Where a person is requested by a billing authority to supply information under any provision included in regulations under paragraph 2, 3, 9 or 10(2) of Schedule 2 to this Act, the authority may impose a penalty of £50 on him if— .
(a)
he fails to supply the information in accordance with the provision; or .
(b)
in purported compliance with the provision he knowingly supplies information which is inaccurate in a material particular. .
(2)
They are in effect, I think, warning you that it is against the law not to tell them if you are sharing your bed with somebody as might make that person instantly liable. But if what you say about the way in which they have said it is fair, then I think you ought to complain.

The fact that you have paid the full amount of council tax would not let you off the hook if you did not tell them that you were no longer solely liable for council tax.

But - councils and QUANGOS and so on do consider it right to assume you are, sorry, probably are or even just possibly might be guilty of something and to require you to prove them wrong. Not nice, I know, but this is how they do things in the 21st century.

Write and ask them to quote precisely which bits of council tax law justify what they have said in this letter.

Ask them to clarify the purposes for which they require the information and a list of people to whom they will supply it, again with reasons.

That seems the best response.

If you are the only liable adult, write and clearly tell them this.