The Department for Work and Pensions says it pays welfare benefits to around 24.3 million people, and its latest release estimates how much money is lost through overpayments and underpayments. The figures turn those mistakes into rates and then into a monetary estimate for the financial year ending 2026.
The release measures overpayments and underpayments as a share of the total annual benefit bill, and also reports the proportion of claims affected. Those rates are then applied to benefit expenditure for FYE 2026, using spending figures consistent with Spring Forecast 2026, to estimate the scale of fraud and error.
Overpayments can come from fraud, claimant error and official error. Official error covers processing mistakes or delays by the Department for Work and Pensions, a local authority or His Majesty’s Revenue and Customs. Underpayments are different: they come from official error only.
That distinction matters because the department changed how it reports one part of the problem. Since FYE 2024, estimates of claimant error underpayments have been removed from this publication and shifted into a separate release on unfulfilled eligibility in the benefit system. The latest figures therefore do not give a full picture of every missed payment inside the welfare system; they give the official measure that the department now uses for this publication.
The estimates are not drawn from every claim. They come from a sample of benefit claims checked for accuracy by a specialist team, with the underlying sample taken between September 2024 and October 2025. That makes the release a statistical estimate rather than a count of every overpayment or underpayment, but it is the department’s official reading of where fraud and error sit in the system now.
For a welfare bill that reaches 24.3 million people, the practical significance is immediate. The release is the department’s own scorecard on how much money is being paid too much, how much is being paid too little and how much of that gap can be traced to fraud, error or administrative mistakes. The question it answers today is not whether the system is perfect. It is how large the losses are, and where the responsibility lies.
