According to the Department for Work and Pensions’ (DWP) latest annual report and accounts, fraudulent benefit overpayments reached £9.9bn in 2025/26.
The overall overpayment rate fell slightly from 3.3% to 3.2% of benefit spending measured for fraud and error. However, the total value increased from £9.4bn to £9.9bn because overall benefit expenditure rose during the year.
Universal Credit continued to account for the largest share of overpayments. The overpayment rate fell from 9.5% to 8.5%, but the cash value increased from £6.2bn to £6.7bn.
Housing Benefit overpayments also declined, falling from 7.2% (£1.1bn) to 6.2% (£800 million). In contrast, Personal Independence Payment (PIP) overpayments almost doubled, rising from £330m to £660m as the overpayment rate increased from 1.3% to 2.3%.
Pension Credit recorded the highest overpayment rate of any benefit at 10%, equivalent to £620m, compared with 10.3% (£610m) a year earlier. State Pension overpayments also increased, rising from £180m to £230m.
The figures were published alongside the Government’s review of the PIP system, which concluded the current approach is no longer fit for purpose.
The DWP said its counter-fraud work prevented around £27bn of incorrect payments during the year. It also reviewed 1.2 million Universal Credit claims, identifying and correcting around 250,000 awards, generating estimated savings of £1.1bn.
The department said it remains on course to reduce the overall fraud and error rate across the welfare system to 2.8% by 2028/29.