Benefit fraud measures outlined

Chancellor George Osborne said cheating the benefit system was unacceptable

The government has set out a series of measures to tackle benefit fraud, as ministers spend the weekend finalising spending cuts.

The steps would mean anyone with three convictions could forfeit their rights to benefits for up to three years.

Chancellor George Osborne told the News of the World that welfare cheats were like muggers who robbed taxpayers of billions of pounds a year.

Mr Osborne will announce the results of the Spending Review on Wednesday.

The chancellor said cheating the benefit system was “unacceptable at the best of times and totally immoral” when the UK has a huge budget deficit.

Mr Osborne said: “Frankly, a welfare cheat is no different from someone who comes up and robs you in the street. It’s your money.”

Under the new scheme every single welfare offence – no matter how minor – would mean an immediate fine of £50.

The government is promising to share more data with credit reference agencies to find patterns of offending.

It is also recruiting 200 new inspectors, creating a mobile task force to go into areas with high rates of fraud and check every claim individually.

The strategy, to be unveiled on Monday, will use high-tech data tracking techniques between government offices and credit reference agencies.

Welfare reform minister Lord Freud said: “Fraud and error is costing the government and the taxpayer £5bn a year – this is unfair and unacceptable.

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“We are reforming the system and stepping up our efforts to catch the benefit and tax cheats who are stealing money which is meant for the most vulnerable people in our society.

“When people are convicted we will get back the money we are owed by introducing tough punishments and stripping the assets of criminal gangs – my message to them is that benefit fraud is a crime that just doesn’t pay.”

BBC political correspondent Vicky Young says the key message from ministers as they approach the Spending Review is that the burden of cutting the deficit will be shared.

Even at this late stage, there is speculation that child benefit could be restricted further – axing the payment for children over 16 would save the Treasury about £2bn a year.

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