Social security fraud investigation regulations and code of practice: consultation

Consultation paper on Investigation of Offences regulations and a Code of Practice for Investigations under Sections 75 and 76 of the Social Security (Scotland) Act.

Section 3 - Impact Assessments on the Code of Practice and Investigation of Offences Regulations

50. The Scottish Government published a number of impact assessments as part of the development of the Social Security (Scotland) Bill. It was recognised that further impact assessments would be required as part of the development and implementation of secondary legislation emanating from that Bill once enacted.

51. The Investigation of Offences regulations, on which we are consulting, is one such secondary instrument. Section 75 of the Social Security (Scotland) Act gives Ministers a power to set out in regulations further provision in relation to fraud investigations. Therefore, we would like to take the opportunity during this consultation to set out our initial views on the impacts we believe there will be through the Investigation of Offences regulations and to seek further views and comments from stakeholders. We would also like to consider more widely any impacts relating to fraud investigations more generally, which are covered under the Code of Practice for Investigations. This will enable us to develop and publish full impact assessments.

52. We believe the following impact assessments are relevant:

  • The Business and Regulatory Impact Assessment ( BRIA)
  • The Equality Impact Assessment ( EQIA)

Business and Regulatory Impact Assessment


53. As part of the social security consultation, stakeholders were asked for views on the existing range of powers granted to investigators. There were 67 respondents who answered this question (33 organisations and 34 individuals). Some thought that the existing range of powers were acceptable, some felt they required further development and some felt they were too wide.

54. Fourteen private businesses and 5 business organisations responded to the public consultation on social security in Scotland, but there was no clear message from businesses regarding fraud investigations.

55. Introduction of the Investigation of Offences regulations or the Code of Practice will not result in additional spend into the Scottish economy and therefore, we believe there is unlikely to be a significant impact upon the business base. However, it may represent a saving to the public purse if use of the powers results in fraudulently-obtained money being repaid.

56. There may be a small financial impact on individual businesses if they are requested to provide information as part of an investigation. However, this is within the context of existing practice, where DWP has existing powers to request information from organisations as part of an investigation. As these powers are only likely to be required in a smaller subset of cases, we do not believe introduction of these new regulations should result in any further financial impact.

57. However, the introduction of a new set of regulations, which may seem unfamiliar to stakeholders, could cause additional requests for information and support from existing advice services. The Scottish Government is aware of the potential pressure points and has noted the importance of the agency working alongside the advice and support services provided by a range of organisations including Citizens Advice Bureau, charities, social landlords and Local Authorities to provide a "seamless customer experience - from advice, to application to payment" as detailed in the Review of Publicly-funded Advice Services in Scotland.

Competition Assessment

58. The Scottish Government does not believe that the Investigation of Offences regulations or Code of Practice will have an adverse impact on the competitiveness of Scottish companies or the third sector within Scotland, the UK or elsewhere in Europe. Any impact would be infrequent and on the basis of an individual organisation.

Test run of business forms

59. No new business forms will be brought in with the implementation of the proposed legislation.

Legal Aid Impact Test

60. The Scottish Government does not expect any significant impact on the legal aid budget, and expects legal assistance through the statutory scheme of Advice and Assistance, and Advice by Way of Representation will continue.

Enforcement, sanctions and monitoring

61. The regulations set out penalties for deliberate obstruction of authorised officers in the use of their regulatory powers. Upon summary conviction, a person may be liable for a fine not exceeding level 3 on the standard scale (£1,000).

62. We do not believe that this should have a significant additional impact on organisations. Existing practice under the DWP system also allows conviction for obstruction of officers with a penalty not exceeding level 3 on the standard scale (upon conviction). Unlike the DWP, our draft Investigation of Offences regulations do not set out any further sanction, such as incurring a daily penalty for continuing non-compliance with information requests after a successful conviction.

63. In terms of monitoring, the Act sets out a duty on the Scottish Ministers to publish an annual report on the performance of the Scottish social security system. Audit Scotland will monitor and report on the delivery of the social security system, including the new agency.

Question 18a.

Have we identified all of the business related impacts?

Yes / No

Q18b. If No, what other impacts do you think should have been included?

Equality Impact Assessment

64. The draft Investigation of Offences regulations set out a framework for obtaining information from organisations as part of a fraud investigation. They allow for the authorisation of officers in the agency to use the powers of entry and search of premises, and requesting information from persons and organisations. As well as considering equality impacts associated with these regulations, we would like to understand equality impacts in the wider sense of fraud investigations that are covered by the Code of Practice for Investigations. In doing so, we believe there may be impacts that we need to consider carefully.

65. As part of the response to the fraud section of the social security consultation, a few organisations highlighted the importance of understanding how a range of equality issues may affect benefit fraud, commenting that:

  • gender may be an important aspect of some benefit fraud, due to aspects of coercive control and domestic abuse;
  • impairments could lead to difficulties communicating and understanding the system; and
  • racial prejudice may affect accusations of benefit fraud.

Protected Characteristics

66. With respect to the introduction of the Investigation of Offences regulations, we do not believe there will be any particular impact on groups who share protected characteristics. The principal interaction that will result from introduction of the regulations will be between officers of the agency and organisations, in order to obtain information relevant to an investigation. We believe there is unlikely to be an impact on individuals in receipt of assistance from the agency, particularly given that the draft regulations only allow entry and search of premises with consent and expressly prohibit entry and search of premise that are used solely as dwelling houses.

67. We recognise that the way in which agency officers go about requesting information may have some impacts on individuals in an organisation and we are keen to try to understand these impacts to inform a full impact assessment. However, we recognise the potential for impacts in relation to fraud investigations more generally. For example, there may be an impact on people with difficulty in communicating, if they are requested to provide information. This could be people who work for an organisation, a person questioned during a visit by authorised officers, or a person being questioned during an interview under caution.

68. The Act recognises the importance of inclusive communication. Section 4 sets out that the Scottish Ministers must have regard to the importance of communicating in an inclusive way, which means communicating in a way that ensures individuals who have difficulty communicating (in relation to speech, language or otherwise) can receive information and express themselves in ways that best meet each individual's needs. Service design is currently underway and will include engagement with stakeholders and those with lived experience to develop an inclusive communications standard.

69. With respect to potential impacts linked to gender and race, it is important to note that any investigation of fraud offences will take into account the circumstances of the case. Such matters will be dealt with sensitively and compassionately and mitigating factors, such as coercion and domestic abuse, will be taken into account. Such a person may themselves be committing a social security offence if, for example, they cause another person to fail to notify a change in circumstances through coercion or abusive activities.

70. The Code of Practice for Investigations also sets out the standards of conduct that a person can expect during an investigation and the principles that will apply, including how, in line with our commitment to a rights based approach, we ensure a person is treated fairly, with dignity and respect. For example, the agency will take steps to ensure a person will be able to participate fully in an interview if they have restricted mobility that prevent them attending an office. This may include conducting the interview at their home or an office closer to their home location. This is consistent with the legislative principles relating to equality and non-discrimination.

Question 19a.

Are you aware of any equality issues we have not identified in terms of introduction of the Investigation of Offences regulations and fraud investigations more generally?

Yes / No

Q19b. If yes, what other impacts do you think should have been included?


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