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National Fraud Initiative

Basildon Council is required by law to protect the public funds it administers. It may share information provided to it with other bodies responsible for auditing or administering public funds, in order to prevent and detect fraud.

The Cabinet Office is responsible for carrying out data matching exercises through the National Fraud Initiative (NFI). Mandated bodies such as Basildon Council are required to provide particular sets of data to the Minister for the Cabinet Office for matching.

The NFI matches data from 1,300 public sector and 77 private sector organisations, including audit bodies in Scotland, Wales and Northern Ireland, government departments and other agencies. It flags up inconsistencies in the information that indicate a fraud, an error or an overpayment may have taken place, signalling the need for review and potential investigation.

The main NFI matching exercise takes place biennially, whilst the Council Tax and Electoral Register matching takes place annually.

Legal basis

The NFI has been running since 1994 and was originally managed by the Audit Commission. The Commission processed the NFI data under its statutory powers under part 2A of the Audit Commission Act (1998) these powers put the matching on a statutory footing for local government and NHS bodies

The Serious Crime Act 2007 (SCA) gave the Commission new powers to enable the benefit of NFI to be extended to Central Government and the private sector. The SCA inserted a new paragraph into the 1998 Audit Commission Act. The SCA imposed a new regulatory regime alongside existing fair processing and other compliance requirements of the Data Protection Act.

The Cabinet Office now conducts data matching exercises under its statutory powers in the Local Audit and Accountability Act 2014 (Part 6). The exercise of data matching is governed by a Code of Data Matching Practice. The Code creates a balance between the important public policy objective of preventing and detecting fraud, and the need to pay due regard to the rights of those whose data are matched for this purpose.

Fair Processing

NFI participants must tell individuals that their data will be processed.

Further information and enquiries

Enquiries regarding the Code of Data Matching Practice or about a particular data matching exercise should be sent:

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