In this section: Hold them to account
Fraud, error and write-offs
Last updated . Figures refresh every night. How each figure is worked out.
The Public Sector Fraud Authority estimates fraud and error in government at £51.3bn to £81.0bn in 2022/23, including tax and welfare. The Department for Work and Pensions estimates that 3.2% (£9.9bn) of benefit spending was overpaid in the financial year ending 2026. Separately, each department discloses its losses and special payments in its accounts; for the ten largest they are set out below. Figures are quoted as published.
Key figures
- £51.3bn to £81.0bnEstimated fraud and error in government £39.8bn to £58.5bn in 2021/22
- 3.2% (£9.9bn)Of benefit spending overpaid
- £1.7bnFraud and error detected and reported to the PSFA
- £914mPrevented and recovered by departments in scope
What is the short version?
- An estimate, not a count: most fraud and error is never detected, so the figures are extrapolated from samples and published as ranges. The amount actually detected and reported was £1.7bn in 2023/24.
- Fraud and error are different: fraud is deliberate; error is a mistake by the claimant or the official, and includes underpayments.
- Write-offs are not fraud: departments’ losses include cash lost, debts written off and spending on things that were then not used; special payments include compensation.
- The departments’ figures cannot be added up or ranked: each counts cases and draws its boundary differently.
- The tax gap (6.4% (£59.2bn), 2024 to 2025) is context, not spending: it is tax that should have been paid but was not, for any reason.
How much is lost to fraud and error?
| Estimate | Figure | Period | Source |
|---|---|---|---|
| Estimated fraud and error in government, 2022/23 | £51.3bn to £81.0bn | 2022/23 | Public Sector Fraud Authority, Cross-Government Fraud Landscape Report 2022/23 and 2023/24, 16 February 2026 |
| Estimated fraud and error in government, 2021/22 | £39.8bn to £58.5bn | 2021/22 | Public Sector Fraud Authority, Cross-Government Fraud Landscape Report 2022/23 and 2023/24, 16 February 2026 |
| Share of government spending and income | 3.0% to 4.8% | 2022/23 | Public Sector Fraud Authority, Cross-Government Fraud Landscape Report 2022/23 and 2023/24, 16 February 2026 |
| Detected fraud and error reported to the PSFA | £1.7bn | 2023/24 | Public Sector Fraud Authority, Cross-Government Fraud Landscape Report 2022/23 and 2023/24, 16 February 2026 |
| Fraud and error prevented and recovered by departments in scope | £914m | 2023/24 | Public Sector Fraud Authority, Cross-Government Fraud Landscape Report 2022/23 and 2023/24, 16 February 2026 |
| Benefit spending overpaid through fraud and error | 3.2% (£9.9bn) | financial year ending 2026 | Department for Work and Pensions, Fraud and error in the benefit system, FYE 2026 estimates, 14 May 2026 |
| Benefit spending underpaid | 0.4% (£1.2bn) | financial year ending 2026 | Department for Work and Pensions, Fraud and error in the benefit system, FYE 2026 estimates, 14 May 2026 |
| The tax gap: tax that should have been paid but was not | 6.4% (£59.2bn) | 2024 to 2025 | HM Revenue and Customs, Measuring tax gaps 2026 edition, 23 June 2026 |
Benefit fraud and error by benefit, with underpayments, unclaimed money and appeals alongside, is on benefit fraud, error and wrongly refused claims; the tax gap by behaviour, taxpayer and tax is on the tax gap.
Estimates of fraud and error are ranges because most of it is never detected: they are extrapolated from samples and reviews. Fraud is deliberate; error is a mistake by the claimant or the official, and includes underpayments. The tax gap is tax that should have been paid but was not, for any reason, and is shown for context: it is not spending.
What do the sources say, in their own words?
“Data for 2022/23 puts the estimated fraud and error in government between £51.3bn and £81.0bn, outside of COVID-19 schemes. This calculation includes tax and welfare”
“In 2021/22 the PSFA estimated that the level of fraud and error was between £39.8bn and £58.5bn.”
“between 3.0% and 4.8% of overall government expenditure and income”
“£1.7bn of detected fraud and error reported to the PSFA in 2023/24”
“in-scope departments prevented and recovered £914m of fraud and error in 2023/24”
“The total rate of benefit expenditure overpaid in FYE 2026 was 3.2% (£9.9bn), compared with 3.3% (£9.4bn) in FYE 2025.”
“The total rate of benefit expenditure underpaid remained at 0.4% in FYE 2026 (£1.2bn)”
“the provisional estimate of the UK tax gap in 2024 to 2025 is estimated to be 6.4% of total theoretical tax liabilities, or £59.2 billion”
Source: Public Sector Fraud Authority, DWP and HMRC, Fraud and error estimates, latest estimates. Checked 22 September 2026.
What do departments write off?
Every department must disclose in its annual accounts the money it has lost (cash lost, debts written off, spending on things that were then not used) and the special payments it made outside its normal rules, such as compensation and ex gratia payments. These are the ten largest departments’ latest disclosures.
| Department | Year | Losses | Year before | Special payments | Year before |
|---|---|---|---|---|---|
Department for Work and PensionsDetails for Department for Work and Pensions | 2025-26 | £522.4m 1,275,438 cases | £480.3m 1,100,830 cases | £11.9m 10,672 cases | £6.1m 11,640 cases |
| |||||
HM Revenue and CustomsDetails for HM Revenue and Customs | 2025-26 | £188.3m 481,522 cases | £382.2m 743,926 cases | Not printed | Not printed |
| |||||
Ministry of DefenceDetails for Ministry of Defence | 2025-26 | £1.23bn 17,622 cases | £1.90bn 18,982 cases | £168.6m 7,080 cases | £110.7m 5,225 cases |
| |||||
Department of Health and Social CareDetails for Department of Health and Social Care | 2024-25 | £2.00bn 158,000 cases | £9.09bn 467,842 cases | £25.0m 8,358 cases | £20.8m 7,411 cases |
| |||||
Home OfficeDetails for Home Office | 2025-26 | £98.3m 11 cases | £364.5m 16 cases | £52.3m 5,552 cases | £80.3m 6,921 cases |
| |||||
Ministry of JusticeDetails for Ministry of Justice | 2024-25 | £71.0m 22,236 cases | £33.9m 37,753 cases | £35.3m 9,895 cases | £36.8m 14,985 cases |
| |||||
Department for EducationDetails for Department for Education | 2024-25 | £34.9m 62,866 cases | £46.4m 56,908 cases | £2.8m 1,763 cases | £3.5m 1,571 cases |
| |||||
Cabinet OfficeDetails for Cabinet Office | 2025-26 | £9.5m 432 cases | £1.2m 437 cases | £716,000 25 cases | £527,000 15 cases |
| |||||
Department for TransportDetails for Department for Transport | 2025-26 | £398.0m 35,484 cases | £581.2m 63,968 cases | £14.5m 8,333 cases | £13.2m 8,729 cases |
| |||||
Department for Energy Security and Net ZeroDetails for Department for Energy Security and Net Zero | 2025-26 | £41m 176,463 cases | £133m 515,980 cases | £10m 1,539 cases | £5m 2 cases |
| |||||
These cannot be added up or ranked. Departments count cases differently (the Home Office groups similar losses into one case; DWP counts every benefit write-off), report for different boundaries, and some round to whole millions. A constructive loss is money spent on something that was then not used, such as a cancelled scheme.
Department for Work and Pensions, 2025-26
- A special payment to a third party to remove the liability for a commercial dispute against the department: £4.7 million
- Software licences purchased in 2021 that will not be used: £2.3 million
- A sealed High Court settlement arising from a longstanding multi-claimant case: £1.7 million
Most losses are write-offs of benefit overpayments. The report says fraud and error overpayments are not counted as losses until recovery options are exhausted.
Source: DWP annual report and accounts 2025 to 2026, printed pages 293 to 298, departmental group, published 9 July 2026.
HM Revenue and Customs, 2025-26
The report lists no individual items to show here.
Losses are mostly personal tax credits (411,382 cases, £155.8m) and Child Benefit (66,644 cases, £20.0m). The special payments table prints no total. The report says there were no individual cases over £300,000.
Source: HMRC annual report and accounts: 2025 to 2026, printed pages 166 to 167, tables 40 and 41, department (resource accounts; revenue losses in the trust statement are separate), published 9 July 2026.
Ministry of Defence, 2025-26
- Impairments arising from historic AWE/AUC review: £408,000k
- Cancellation of Shadow Mk2: £253,580k
- Cancellation of Project Morpheus: £235,655k
- LGBTQ Financial Redress Scheme (special payment): £48,450k
Losses over £300,000 total £1,204,906k. Constructive losses, where money was spent on something that was then not used, total £1,158,306k.
Source: Ministry of Defence annual report and accounts 2025 to 2026, printed pages 153 to 157, departmental group, published 15 July 2026.
Department of Health and Social Care, 2024-25
- Constructive loss on COVID-19 antiviral medicines that reached their expiry dates: £856 million
- A second constructive loss on COVID-19 antiviral medicine expiry: £393 million
- Claims against personal protective equipment suppliers waived (in the table): £21.3 million
The latest report found for this department is for 2024-25. The group case count is printed as 158,000. The report says claims of £572m against 25 PPE suppliers were waived, most of which were disclosed as losses in earlier years.
Source: DHSC annual report and accounts: 2024 to 2025, printed pages 212 to 213, tables 42 and 43, departmental group, published 11 December 2025.
Home Office, 2025-26
- Police National Database 1.5 programme: contract terminated (constructive loss): £35.2 million
- Atrium Hotel, Hounslow: additional capacity not required (constructive loss): £22.9 million
- Administrative error in the Immigration Health Surcharge reimbursement scheme (cash loss): about £18.7 million
- Former Ministry of Defence site at Northeye, Bexhill (constructive loss): £14.9 million
The department groups similar losses and counts them as one case, which is why the case count is low. Special payments include the Windrush Compensation Scheme (1,038 cases, £15.8m).
Source: Home Office annual report and accounts: 2025 to 2026, printed pages 216 to 221, departmental group, published 14 July 2026.
Ministry of Justice, 2024-25
- Constructive losses arising from the prison capacity programme: £23,996,152
- Legal Aid Agency: fraudulent claims by a legal aid provider, 2012 to 2015: £22,136,000
- HMP Dartmoor reclassified as surplus property (impairment loss): £16,800,000
The latest report found for this department is for 2024-25. It lists 17 losses and 14 special payments over £300,000.
Source: Ministry of Justice annual report and accounts: 2024 to 2025, printed pages 160 to 163, departmental group, published 30 October 2025.
Department for Education, 2024-25
- Student loan employer deductions written off (61,414 cases, each below the reporting threshold): £6,808k
- Apprenticeship provider corporate failure: Vista Training Solutions: £2,200k
- Apprenticeship provider corporate failure: ARC Academy UK Ltd: £2,016k
The latest report found for this department is for 2024-25. Student loans written off on death, age and similar grounds (£309.6m) are shown separately and are not in the losses total.
Source: Department for Education consolidated annual report and accounts 2024 to 2025, printed pages 171 to 174, group, published 17 July 2025.
Cabinet Office, 2025-26
- Work ended on a centralised applicant tracking system (constructive loss): £7,767,249
- Non-contractual part of the former Cabinet Secretary's severance payment (special severance payment): £526,598
The losses total printed in the report includes special payments.
Source: Cabinet Office annual report and accounts 2025 to 2026, printed pages 155 to 156, departmental group, published 14 September 2026.
Department for Transport, 2025-26
- National Highways cancelled road scheme: A12 Chelmsford to A120 improvement: £212.5m
- 2024-25 Dartford Crossing charges written off (many cases together): £111.4m
- National Highways cancelled road scheme: A47 Wansford to Sutton: £39.1m
Source: DfT: annual report and accounts 2025 to 2026, printed pages 167 to 170, departmental group, published 15 July 2026.
Department for Energy Security and Net Zero, 2025-26
- UK Atomic Energy Authority: impairment on the design and build of a first-of-a-kind test rig: £26.2m
- Special payment to Ofgem for its administration of the Non-Domestic Renewable Heat Incentive: £9m
- Nuclear Decommissioning Authority: Berkeley Blower House remediation project closed early (constructive loss): £8,968,000
Amounts are rounded to whole £ millions in the report.
Source: DESNZ annual report and accounts 2025 to 2026, printed pages 155 to 156, departmental group, published 16 July 2026.
Source: Each department, Annual reports and accounts: losses and special payments, latest annual report. Checked 22 September 2026.