Resetting the relationship between local and national government. Read our Local Government White Paper

Erewash Borough Council: Derbyshire Joint Fraud Initiative

The original members of the consortium who formulated the bid comprised: Amber Valley Borough Council, Chesterfield Borough Council, Derbyshire Dales District Council, Erewash Borough Council and South Derbyshire Borough Council and the project was intended to enable fraud investigation capacity to be retained by councils following the introduction of the Single Fraud Investigation Service (SFIS) by the Department of Work and Pensions (DWP).

The bid pointed out that there were still significant risks to the public purse through council tax support abuse and the false claiming of discounts and exemptions, in particular Single Person Discount (SPD).

To support this retained investigative capacity into the longer term the consortium sought to develop an improved method of utilising credit referencing agency information as part of a regular review of council tax discounts/exemptions, National Non Domestic Rates (NNDR) database maintenance, and improved collection of sundry debts. The consortium, in partnership with the credit reference agency Callcredit, developed a new approach to reviewing discounts and exemptions which provides seamless real time integration to the credit referencing agency and, dependent on the risk score, referred cases back to the relevant council to investigate.

The significant difference in this approach to others currently undertaken by councils is the fact that this review process is conducted monthly with a seamless integration between systems.

As the lead council, Erewash has been in discussions with other councils requesting more information and seeking guidance on whether they are able to join our procurement utilising their own funds. This eventually led to four additional neighbouring councils joining the consortium - High Peak Borough Council, Staffordshire Moorlands District Council, North East Derbyshire District Council and Bolsover Borough Council.

The project has led to investigations to prove a business case for using our own funding to provide further software enhancements to capture benefit and council tax support data via digital forms and apply a risk based verification process approved by the DWP which will further reduce fraud and error whilst reducing administrative input to fund the extended project.

This was taken up by two of the original partners Erewash and South Derbyshire and all four of the new partners.

Issues, challenges and barriers

Due to the timing of the allocation of funding and the lead time for the design, specification and procurement of the software solutions the project did not become operational until late 2015/16 and the initial results were reported to the steering group for the period to 2016/17 for the extended group membership.

The initial results were found to be somewhat inconsistent and below those indicated based on one off projects at other councils; This led to a reluctance by the majority of partners to automatically cancel SPD and an insistence on further checks; The results of these did lead to a refining of the algorithms used by Callcredit over the next 12 months, but meant that the initial phase of the project, which was to undertake a “one off” review of the entire SPD file, took longer than anticipated and for most partners and extended through 2017/18.

However, by the end of 2017/18 most partners had completed the initial full review and whilst the recorded savings were less than anticipated the project moved on to only checking “alerts” which were provided automatically through the Callcredit system; This has the advantage of being much less resource intensive, and the intention is that a full review will not be required again; Overall this is seen as a better way to maintain an accurate file than a costly and time consuming “one off review” which often creates negative publicity.

Also during 2015/16 and 2016/17 further modules were trialled which facilitated:

  • Credit reports identifying empty property occupation
  • A module of third party business intelligence software to assist with business rate collection
  • A module consisting of propensity to pay searches to identify debtors’ ability to pay.
  • The creation of a localised anti-fraud hub.

The empty property module did prove useful in increasing the tax base but the restrictions in empty exemptions and ability to charge a premium on long term empty property has largely negated the value of this and the module was rendered unavailable with the introduction of the GDPR regulations.

None of the other modules proved beneficial, although the NNDR module did provide some information to allow a limited file clean up, and have now been either retired by Callcredit or dropped under the annual renewal terms of the contract.

The data appears superior to that available from the National Fraud Initiative (NFI) and it is interesting that the NFI has introduced an additional chargeable service based on credit reference data; It is hoped that the alerts provided will reduce the number of NFI alleged matches to save future abortive NFI effort.

Unfortunately for 2016/17 two of the original partners, Chesterfield and Derbyshire Dales, gave notice to leave the project as their savings were insufficient to continue to incur the additional costs from their contracted out service provider; A further partner, Amber Valley, also left the project.

During the current financial year it has been difficult for the partners to maintain staffing resources to continue the level of input due to budget cuts and the general financial position of the councils. A workshop provided by Callcredit recently has recently added momentum and a further steering meeting is arranged for March 2019 to review the position.

All the six remaining partners funded from their own resources risk based verification for benefits and council tax support and digital forms for all revenues and benefits; This has led to five of the six also purchasing further digital capacity to lead transformation projects in customer contact and transactions management.

Outputs and outcomes

  • For 2016/17 cancellations of SPD for the extended group were calculated at £214,000
  • For 2017/18 cancellations for the six remaining partners were a further £175,000
  • For 2018/19 figures are only available for the first half year and total a further £30,000
  • Saving on not having to carry out at least one “one off” review during the period for the remaining six partners at £30,000 each, £180,000 in total
  • Less effort required at the grant of SPD leading to better customer service.
  • Investigation can be targeted at high and medium risk cases and therefore the majority of claimants are not subject to disruption.
  • The project has allowed a number of apparently similar councils to note differences in results between the partners; One partner who had carried out regular reviews using a commercial outsourced option still obtained good results from initial checking, whilst another who had done no reviews did not get the same level of cancellations, indicating that its data base was in a good state of accuracy and compliance without significant expenditure or effort.
  • Perhaps the biggest factor noted was that the results for the Derbyshire consortium were significantly lower than others carried out by Callcredit; This is still unresolved and could have significance for the claims being made by the companies operating in this field to justify their contracts.


  • Callcredit has adopted the methodology developed and are marketing it.
  • Although three councils left the project after the funding was exhausted to enable enforced savings to be made the remainder have managed to embed the process into “business as usual” and along with the RBV and digital transformation ensured that efficiencies have been made over a wider area.
  • Six councils continue to co-operate in an ongoing project which has developed beyond the original concept, whilst retaining the capability of protecting the public purse.

Size of grant

£698,000, with savings in 2015/16 and 2016/17 of £555,000, yielding a RoI of 0.8.

Contact details

John Drewett, Exchequer Services Manager, Erewash Borough Council, [email protected]