Georgia Gould MP: speeches

Speeches

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  I am sorry to have arrived late. Clause 6 will provide essential powers to obtain communications data from telecommunications providers, as and when necessary, as part of an investigation into fraud against the public sector. As a result of the clause, the PSFA will be listed under column 1 of schedule 4 to the Investigatory Powers Act 2016 and will thereby be granted the power to request communications data—the how, where, what and when, as opposed to the content, of communications—for the purposes of investigating suspected fraud against the public sector. The clause will not give the PSFA surveillance and covert human intelligence powers. The precise listing of the PSFA in schedule 4 will not permit self-authorisation to use the relevant powers; a request for communications data in the course of a criminal investigation must be approved by the independent Office for Communications Data Authorisations. The powers also come with extra oversight from the Investigatory Powers Commissioner’s Office, which will inspect the designated communications data single point of contact that facilitates the lawful acquisition of communications data and effective co-operation between the IPCO and public authorities that have these powers. I welcome the Opposition’s support for Government amendment 1, which is necessary to align us with the Home Office’s new approach to restrict powers to specific teams in other Departments within the same schedule. The amendment will change the way the Department appears in schedule 4 to the Investigatory Powers Act, as it will restrict the use of the powers to the Public Sector Fraud Authority only, not the Cabinet Office as a whole. The amendment will ensure that the use of the powers is properly restricted and that there are no unintended consequences for other parts of the Cabinet Office. I commend clause 6, as amended by Government amendment 1, to the Committee. Amendment 1 agreed to. Clause 6, as amended, ordered to stand part of the Bill. Clause 7 Police and Criminal Evidence Act 1984 etc powers Question proposed, That the clause stand part of the Bill.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  I thank the shadow Minister for those questions. As he said, these are important powers, and it is critical that the right training is in place. I reassure him that all these authorised officers will have relevant training to the standard that police officers have for the use of the PACE powers. As he set out in his remarks, an application for search warrants must be made to a magistrate, so there is already an external body ensuring that they will be used correctly. Another critical component of the PSFA’s use of the powers is that if an authorised officer is visiting a property, they will be accompanied by a police officer and will not go their own, so we have not included powers of arrest because of the nature of the PSFA investigations as separate to the Department for Work and Pensions. The powers sit within a range of safeguards, some of which have been mentioned. To remind Members, His Majesty’s inspectorate of constabulary and fire and rescue services will also oversee the use of all these powers, as it has experience of doing that. The powers will be overseen in any serious circumstances by the Independent Office for Police Conduct. Question put and agreed to. Clause 7 accordingly ordered to stand part of the Bill. Schedule 1 agreed to. Clauses 8 and 9 ordered stand part of the Bill. Clause 10 Acting for another public authority Question proposed, That the clause stand part of the Bill.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  The first point to clarify is that before any investigation and any debt recovery are started, there would be a vulnerability test on that individual, and that would be part of the basis for the decision making. As for whether there was a voluntary agreement about the recovery of debt, a conversation would happen with the individual, but there is a limit to the amount that would be recovered—up to 40% of their assets in their bank account for fraud and 20% for error. In terms of whether people would try to frustrate the process by unnecessarily reviewing it, one of the features of the Bill is that it can include interest on the money that is paid, so that is a disincentive to continue to drag out the process, and the matter can be resolved as quickly as possible—and voluntarily. On the initial phase of the PSFA’s investigatory and debt recovery work, if there is a limited number of officers, we do not expect a high burden on the court system—we expect less than double digits to be taken through initially—and we believe that the provision around interest is a key disincentive against frustrating the process. Question put and agreed to. Clause 10 accordingly ordered to stand part of the Bill. Clauses 11 and 12 ordered to stand part of the Bill. Ordered, That further consideration be now adjourned. — (Gerald Jones.)

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  Clause 7 and schedule 1 cover the investigative powers in the Police and Criminal Evidence Act 1984. Clause 8 will give the PSFA a legal route to apply to a court for an audit in relation to property that has come into its possession in the course of a fraud investigation. Clause 9 will bring the PSFA under the oversight of the Independent Office for Police Conduct for serious complaints about its use of PACE powers. Clause 7 will designate authorised investigators with the necessary authority to use limited provisions from PACE within the remit of public sector fraud investigations. These include powers to apply to the courts for a warrant to enter and search premises and to seize evidence, and special provisions to apply to the courts to gain access to certain types of material that are regarded as excluded material or special procedure material. These are criminal investigation powers and will only be used in criminal investigations to enable all reasonable lines of inquiry to be followed and all relevant evidence to be collected. PSFA staff must be specifically authorised by the Minister before they can use the powers in the clause. Authorised investigators will be able to access and process evidence under the same conditions applicable to the police, ensuring that robust investigative protocols are followed. PACE has its own code of practice, and authorised investigators will adhere to the provisions that apply to the PSFA’s PACE powers, in particular PACE code B, which deals with the exercise of powers of entry, search and seizure. Clause 7 is fundamental in reinforcing the Bill’s objective of combating public sector fraud effectively by equipping investigators with powerful investigative tools, governed by long-standing safeguards. The provision of such powers is essential and reflects our commitment to holding to account those who defraud public resources, maintaining the integrity of public administration. Schedule 1 will modify the provisions of PACE adopted in clause 7 so that they apply to authorised investigators within the PSFA when they are conducting criminal investigations into fraud offences committed against the public sector. Clause 7 will enable these modifications to have effect; they include equating authorised investigators with constables for the relevant sections of PACE, clearly defining the range of their responsibility and authority. An amendment to replace “articles or persons” with “material” in schedule 1 is specifically intended to clarify the scope of investigations conducted by the PSFA. By defining the term more narrowly with reference to “material”, it reflects the fact that the PSFA will not be conducting searches of individuals. While detailed stipulations regarding the retention and handling of seized material are set out in PACE, schedule 1 will provide the essential adaptations necessary for the authorised investigators to carry out their roles effectively while adhering to established legal safeguards. Overall, schedule 1 is necessary to equip authorised investigators with precise, tailored powers from PACE so that they can enforce the legislative aim of combating fraud within the public sector. Clause 8 will give the PSFA a legal route to apply to a court for an order in relation to property that has come into its possession in the course of a fraud investigation. The order will determine who the property should be returned to and whether changes need to be made to the property before it is returned or, if appropriate, destroyed, subject to suitable safeguards. The PSFA will not routinely need to use this power. It will use it only in three specific situations: first, when there is conflicting evidence as to who the property should be returned to; secondly, when it is not possible to return property to its owner, and the PSFA is otherwise liable to retain it indefinitely; or, thirdly, when it has been identified that the property could be used in the commission of an offence. Clause 8 will protect the PSFA in situations in which it could otherwise face having to retain property indefinitely, at ongoing cost to the taxpayer, and where it cannot return the property to its owner. It will ensure effective management and disposal of items, helping to prevent misuse while reducing the administrative burden. The use of a magistrates court to determine the appropriate course of action is a critical safeguard. This external judicial oversight ensures transparent and lawful disposal decisions. A mandatory six-month waiting period is built into the process before property can be disposed of or destroyed. This period will allow any interested parties to make claims on the property. However, if a magistrates court orders that the property be returned to its owner, there is no waiting period for that return. Further application to court can be made if initial orders do not resolve ownership or disposal issues, ensuring ongoing flexibility and fairness in property management. Equipping the PSFA with these powers is vital for appropriately concluding fraud investigations and reflects similar practices in other Government Departments. I turn to clause 9. The PSFA’s use of PACE powers will be subject to robust internal and external scrutiny. Elsewhere in the Bill, clauses 64 and 65 set out provisions under which His Majesty's inspectorate of constabulary and fire and rescue services will work with the PSFA. Clause 9 amends the Police Reform Act 2002 to extend the functions of the director general of the Independent Office for Police Conduct to include oversight of public sector fraud investigators and enables them specifically to consider the PSFA’s use of PACE powers and associated investigations. In doing so, this clause enables the IOPC to be engaged where necessary to investigate death, serious injury, accusations of staff corruption or serious complaints against the PSFA’s use of PACE powers, although we hope that none of those will come to be. The amendments made by clause 9 also include allowing the Minister to issue regulations conferring functions on the director general in relation to these investigations. In practice, this enables the Minister to detail in due course the specific remit of the IOPC in relation to the PSFA. This clause represents a typical approach to engaging the IOPC in legislation, similar to that of other law enforcement agencies. The clause will also enable the sharing of information between the director general, the Minister and those who act on their behalf. Additionally, it will enable the sharing of information with the Parliamentary Commissioner for Administration to facilitate potential collaborative investigations with the IOPC. The clause will ensure that any information sharing complies with existing data protection and investigatory powers legislation. Incidents and complaints will be either self-referred from the PSFA or referred to the IOPC via a third party. Any potential cases of serious injury or death that occur in the exercise of the PSFA’s PACE powers would be automatically referred to the IOPC for review. The use of the independent complaints function offered by the IOPC is a key element of the oversight landscape, ensuring that the PSFA is held accountable to the highest standards in the exercise of PACE powers, and providing confidence to the public that the Government take their responsibilities in using the powers seriously. I went through a lot of detail there, but I know that the Committee is concerned about the proper oversight of powers, as it should be.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  As I have set out, the Bill provides the key powers to investigate suspected fraud against the public sector. However, to be able to deliver a holistic counter-fraud service and recover vital funds lost to fraud and error, powers are needed to act on behalf of other public authorities for recovery action. That is what clause 10 outlines. The PSFA will already have conducted investigations before the recovery phase and will know the background to the case and the people and businesses involved. It will be able to leverage that information and those relationships to secure recovery, prioritising voluntary repayments first. It will then be able to utilise the proposed recovery powers already used across Government to get back fraudulent funds where people can afford to repay their illicit gains but are refusing to engage with us. The recovery of fraudulent funds is complex, as is fraud itself. In 2021-22, the Government’s fraud landscape report found that only 23% of fraud losses were recovered. That is not good enough. Having a central recovery function within the PSFA will allow it to develop the expertise and capability required to drive effective recovery action on behalf of other public bodies. Providing the option to keep some of the recovered funds, subject to agreements with the public bodies concerned, helps to fund the development of that recovery expertise and provides value for money for the Government and taxpayer. Clause 11 outlines the requirement to issue a recovery notice before proceedings can be brought to a court or tribunal. The notice must outline what the Government believe is owed and why. It must also provide information as to how the amount can be voluntarily repaid. Once issued, the liable person has a minimum of 28 days to respond. The recovery notice will effectively signal the end of the PSFA investigation. During an investigation, a suspected liable person will already have had the opportunity to make their case and provide evidence to support their position. This provides the liable person with further opportunities to positively engage on the matter, either through voluntary repayment or by providing additional evidence. It also provides them with ample opportunity to prepare for a potential future court or tribunal proceeding. The issuing of a recovery notice is therefore an important step that promotes fairness and transparency in proceedings by providing a liable person with an overview of the position. Clause 12 provides a key safeguard for the use of the recovery powers. During an investigation, the PSFA will collect and assess evidence to determine whether a liable person or business received payments made as a result of fraud or error. It will outline its reasonings in the recovery notice. However, it will be able to use the proposed recovery powers only if a liable person agrees and a court or tribunal has made a final determination of what is owed. We will not be making unilateral decisions as to what is owed. Instead, this process firmly embeds independent judicial decision making. If a liable person disagrees with the determinations, they can present their case in a court or tribunal. If a liable person agrees, we do not need to seek confirmation from a judge, making important judicial time and cost savings and ensuring that we do not further overburden the judicial system. Those are all important steps in commencing our recovery action. The positive impact of the Bill is predicated on being able to effectively recover funds identified as being lost to fraud or error. We have already agreed that recovery is a vital new core function of my Department, and it is one that we should strive to ensure can operate effectively to return money lost to fraud and error to the public purse.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Concerns were raised earlier that the PSFA would take its eye off the ball on prevention and the wider area of work, and become an agency focused only on enforcement. It would be helpful if you could address and answer those concerns. Mark Cheeseman: The Public Sector Fraud Authority has two elements to it. One is overseeing Government and how individual Departments are doing in dealing with fraud and what they are doing on it; the Bill itself says that Departments would refer cases to the PSFA and ask for them to be dealt with under it. The second is providing some of the services that support Departments around taking action on fraud where it happens. The biggest difference we will make, alongside that, is through prevention. We heard from witnesses earlier about the use of data and analytics. We have a data and analytics service that works with public bodies to use that to find and prevent fraud up-front. We also have a risk service that works with other parts of the public sector to understand the risks they face, in order again to prevent those risks by putting in controls. While there will always be that balance, there will also always be some element of fraud that is still committed. We will not be able to design a system where there is no fraud risk or design out fraud. There will always be cause for an efficient, effective and proportionate part of the machine to take action on those instances of fraud and to investigate them thoroughly and properly.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Thank you very much.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q I want to build on the earlier line of questioning about Ministers’ sign-off. My under-standing is that the powers will be delegated to authorised officers and there will be no ministerial sign-off on any part of the investigation. That will rightly be separate. I think it would be helpful if you could clarify how that will work in practice. Mark Cheeseman: Yes. Apologies—that was a slip when I answered earlier. Yes, the powers of the Minister—it is written as “the Minister” in the Bill—are delegated to authorised officers, who sit in the PSFA. They would be qualified to the standards of the profession, and they would be taking the decision. What I was referring to earlier is that any review decision, if someone asked for a review, would be taken by a separate authorised officer. There are a number of provisions in the Bill to enable people within the process to make an information-gathering request or to ask for something else to be reviewed.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Thank you both for your evidence. First, to Joshua, on the NAO’s reports on fraud, the PSFA measures hopefully build on many of those recommendations. I would welcome your assessment of the PSFA measures in that light and of any areas where you think we should go further. Joshua Reddaway: I think you are referring to the report we did in March 2023, after the PSFA had just been established. We very much wanted it to be a baseline for the challenges it was trying to deal with. We basically said that there needed to be a cultural change across all of Government, that 84% of the resources were in DWP and HMRC, and that covid really exposed that the Government did not have the capability in other Departments. I have to say that, from our point of view, we saw fraud as essentially a welfare and tax issue for many years, so it was a bit of a surprise to start bringing it out to the other Departments a bit more. I would interpret the Bill as being about giving the powers, particularly on the enforcement side, and in the meantime, the PSFA has been doing quite a lot on the prevention side. The prevention side is primarily where I would be focused because that is where the biggest gains are to be had in dealing with the cultural changes that are needed across all of Government. Mind you, I do not read the Bill as being against that; I see it as supplementary. We would be very disappointed if the PSFA became exclusively an investigation and enforcement-type agency. The impact assessment thinks it can get roughly £50 million over 10 years from enforcement. Like I say, every million counts, but that is very tiny compared with the challenge that the PSFA is trying to meet. Is that the sort of thing you are interested in?

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q As an adviser to the PSFA, you have seen the organisation grow. What is your assessment of where the PSFA is in tackling public sector frauds, and how the Bill moves us on? John Smart: That is a big question. I have been involved with the Cabinet Office for over 12 years, so the inception of the PSFA came about while I was working there. In the 18 months since it was formed, the PSFA has gone a long way to reach a better understanding of where the issues sit across Government. Clearly, it plays best outside the DWP and HMRC. My passion has been identifying where fraud is taking place, which I have worked on for the past 10 years, and trying to quantify the fraud occurring within Government. As you all know, that is very hard to quantify because it is hidden and therefore unknown. The PSFA has gone a long way and is continuing to flush out where resources should be committed to preventing, investigating and deterring fraud across Government outside HMRC and the DWP. That is critical. When I first started asking Departments where frauds were within the Departments, they replied, “There’s nothing to see here.” At least now, particularly because of the work the PSFA has been doing, there is recognition that there is a real issue to be addressed, and that it is not just expenses fraud, or whatever they used to think it was.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Thank you. It would be helpful to hear from you about the work that the PSFA has been doing more broadly to consult, and to talk to other parts of the public sector and other experts, in developing this package and the thinking behind it. Mark Cheeseman: Absolutely. First, the PSFA has been brought together from experts across the system. We have brought in experts not just from within the public sector, but from other sectors, and we also work with other countries to understand what they do on this. We have been consulting very widely with the public sector, and a number of the people who have come to look at this have looked at it from the point of view of what they could not achieve in their own public bodies and therefore how they could take more action and what that power would look like. We have also brought together other investigators and asked them what they think the optimal powers are and what the proportionality aspect and the safeguards should be, and considered that. We have done quite broad consultation within the public sector, but we have also asked local authorities what their views are on other aspects such as that.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  That is a very helpful challenge. Joshua Reddaway: That is my understanding of this. Our one concern is, please don’t let this be the tail that’s wagging the dog.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Yes, and I wholeheartedly agree with that. A massive role in prevention, professionalisation and raising the profile of fraud sits within that, but what is your analysis of how much the deterrent measures in the Bill will support that prevention agenda? Joshua Reddaway: It is not rare to find what we call audited bodies, Government organisations, that have found a fraud, have taken it as far as they can through their internal services, and have tried to hand it over to the police to make an arrest—this is the point where it is outside audit—but have not been able to find anyone who will pick up that file, which has been fairly developed. The point that we raised in the 2023 report and that the PSFA was trying to deal with was: how can you get an organisation that fills the gap to help defend the Government when they get attacked? The police are basically going to say that Government are big enough and ugly enough to look after themselves on this. When we looked at fraud more widely across society in a report that we did later in 2023, we found that at that time it was 40% of all crime and 1% of police resources. That is what you are trying to tackle here. You are trying to have an organisation that fills the gap on enforcement. How important is that? I think it is about having a deterrent, and if you get it right it should also be about root cause analysis. By that I mean, if you have an investigation and you are able to fully investigate it, it is not just about prosecuting that person, but about properly understanding why that happened in the first place, and improving it. So if you are an organisation that is outsourcing an investigation to another party, I always wonder a bit whether they will do that bit of the loop. I am hopeful that the PSFA will develop the capability to do that.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q And those authorised officers would make the decision about the timing to allow for information gathering; that would not be a ministerial decision. Mark Cheeseman: Absolutely. That decision is made by the authorised officers, based on their experience of weighing up both proportionality and how they can engage with the organisation or individual they are asking for that information, and that individual or organisation can request a review of that request.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q So it is about being explicit that that is a minimum and it can be extended, based on those conversations? John Smart: Exactly. That is the reason for the starting point.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q I echo the points made by my hon. Friend the Member for Stretford and Urmston about the really strong level of engagement. I welcome the conversations that we have had and that I know are ongoing with our teams. On the PSFA side of the Bill, I heard what you said about potential exemptions, but are there any other areas that you would like us to work on in detail as we move forward? Daniel Cichocki: The key thing for us now, as I said in relation to the DWP measures, is to start to look at the detail of the draft regulations and the code of practice that sit behind the powers, which we look forward to engaging on. Our broader observations are more on the DWP side. Across both elements of the Bill we welcome very strongly the independent review processes that have been built into the powers. We think the scope of those reviews could just consider some of the other factors that we know have been raised as questions around these powers. For instance, could there be more direct scope for that independent reviewer to consider the impact of some of the unintended consequences on vulnerable customers and the cost of compliance? Those are just some broader points on the independent review, but I think the principle of having one across both elements of the Bill is important.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q I have a question about the information-gathering powers and timings that builds on previous questions. The current proposal is that there will be a minimum of 10 days to gather information, but that that timeframe can be made longer in discussion with the business, and be made proportionate to its size. The business or organisation will be able to request a review of the timeframe if they feel it is too onerous. Is that a proportionate position in terms of information-gathering powers and safeguards? John Smart: As we said earlier, the larger organisations will be geared up to provide the information within the timeframe required. Some of the smaller organisations might struggle to meet that 10-day requirement, but I still think it is a reasonable starting point. If you do not start with a reasonable starting point, for the larger organisations you end up deferring decision making and action being taken. I think 10 days is reasonable.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q In your experience of researching fraud, how does this Bill compare to international best practice? Should we be considering anything else that you have seen that particularly works in other places? Professor Levi: The Americans used to be better at this than may have been the case in the past few weeks. The General Accounting Office and some of the inspectorates general in the US have been pretty active, but the US still had a huge amount of covid-19 fraud. Australia is getting better. Clearly, the head of the Public Sector Fraud Authority is part of this group of people trying to improve things, but I would say we are starting at a pretty modest level, in terms of numbers of people. In terms of the DWP, it is a struggle for everyone. We have to look at it in relation to general welfare. I remember going to a meeting and talking to some French delegates who said to me that it was about—

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q I am interested in the point you made about future-proofing against future pandemics or crises. Can you both give us your reflections on what you learned from the covid pandemic? Do you feel the Bill addresses what we need to do to ensure that we do not end up with the level of fraud we saw during the pandemic? Kristin Jones: We have to plan for emergencies—they will, inevitably, occur—and the work on that should be kept up to date so that you can refer back to one you prepared earlier. That is so important because when there is an emergency, everybody is doing their best to get through it as fast as they can, and that is not the time for slow consideration, whereas having been through that experience, now is the time to reflect and document what we are going to do in future. Alex Rothwell: Fundamentally it is about the loosening of controls, our understanding of the impact of the loosening of controls, and the friction that is or is not introduced when you are addressing an emergency. We also now have a much better understanding of how that can manifest itself. But I am confident that the Bill would enable an effective response.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q Obviously, the provision in the Bill is to move the PSFA to be a statutory body, but as we were discussing earlier, built in for the current period is the oversight of an independent chair. Does that offer reassurance of that oversight in the meantime? Helena Wood: There is a question of “Who guards the guards?” in some respect. This Bill has significantly built in oversight; I think at every step we see that. However, it depends who the independent chair is, and a question would be whether that individual could be subject to a parliamentary approval process, as other oversight positions are—particularly if we look at the National Audit Office model, for example. It might be good to build in a parliamentary approval process for the individual who will take that role.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q On the PSFA side, in order to recover debt, you would have to apply to a court. Does that answer that point or is there more to be done? Professor Button: Yes, I think that does. That is fine. Professor Levi: His Majesty’s inspectorate of constabulary and fire and rescue services has been pretty tough on fraud policing by the police, so I am personally encouraged by the proposal for accountability and review by them. It is reasonably rigorous and scientific, and there is the National Audit Office as well. Following on from Professor Button’s comments, sampling behaviours at all levels is a good methodology for testing. The question that Dr Kassem was raising earlier about the internal stuff and the supervision of that is a more complex example. Dr Kassem: My suggestion was more about having an independent oversight board—independent from the PSFA—to review the work and also perhaps to support an independent audit of the operation and see whether the Bill is actually working in terms of recovery and of transparency and fairness. Someone might say, “Okay, we need someone from the PSFA on the board to feed back about operational tasks and challenges and so on.” That is fair enough, but that could slightly reduce the independence that we are talking about. It can still produce a report to describe the work, the performance and the challenges that it met, and a completely independent board can then oversee the work and challenge and scrutinise it if needed.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q You mentioned that the PSFA powers are used generally, but they have not been available to tackle fraud in the public sector outside of tax and welfare. What is your assessment of bringing those powers into this space? How effective will they be at tackling public sector fraud? Helena Wood: This is a really necessary approach. However, I would caution that we are holding off from establishing the PSFA as a statutory body for now, and I completely understand the reasons for that: we are in a very tight fiscal environment, the cost of setting up a new agency is substantial, and we need to test the competence of the PSFA in doing so. However, I think in due course we need a more fixed timeline to move the PSFA off into a statutory body, to at least remove any perception—if not actual political interference—in investigations. That is really important—we need a stronger timetable. I know that will happen when the time is right, but I would like to see a stronger timetable towards it. I think there will be at least a perceived risk of Executive overreach if the PSFA does not move in that direction more quickly.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  So the other half—the prevention side—has to accompany this. Alex Rothwell: Absolutely.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q The proposal is to have an independent chair that is completely independent of the PSFA and reports into Parliament. Do you think that answers that point? Dr Kassem: Yes.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (First sitting) · Hansard source

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  Q Is the partnership with the PSFA that already exists working well? Alex Rothwell: Yes, it is. As I mentioned, the professionalisation of fraud specialists has made huge inroads in terms of the acceptability of fraud professionals, particularly in a finance environment—we deal with audit committees and so on—and there is also the recognition that the Government are taking fraud seriously. That is not just this Government but the previous one as well. The direction we have had from the Cabinet Office—