Hundreds of Blue Badges cancelled after government fraud buster investigation discovers disability permits issued to dead people still in use

Hundreds of Blue Badges have been cancelled after an investigation by government fraud busters discovered that disability permits issued to people who had died were still in use.

Chancellor John Healey is expected to announce at the Budget on Wednesday that more than £400million was saved or protected by the Public Sector Fraud Authority (PSFA) last year.

The PSFA, based within the Cabinet Office, hit 119 per cent of its target for recovering public money last year and will get new powers to refer cases directly to prosecutors from the spring.

Among the scams rooted out by government fraud busters was the use of 459 Blue Badges in the Wirral, Merseyside, after it was discovered they were issued in the names of dead people.

The Blue Badges – which give disabled people access to priority parking and are a lifeline for many – were cancelled when it was discovered they were being used fraudulently, saving taxpayers more than £363,000 between 2024-2025.

PSFA investigators compiled a list of potentially fraudulent badges by cross-referencing council data with records kept by the Department for Work and Pensions.

Traffic wardens across the Wirral are now conducting targeted patrols in busy areas near schools and have powers to confiscate the fraudulent Blue Badges on the spot.

The Treasury said that, in total, more than £34million worth of Blue Badges have been cancelled across the country over the past two years following investigations by the PSFA and councils.

Anybody found to be misusing a Blue Badge following the death of the badge holder faces formal warning letters and fines of up to £1,000.

Other scams uncovered by government fraud busters include ten council homes that were recovered from fraudsters in Ealing, giving scarce social housing to those genuinely in need.

Covid-era Bounce Back Loan scammers and multiple-job fraudsters have also been forced to pay up or brought before the courts by the PSFA.

Some £117million of Bounce Back Loan fraud is being recovered, including £81million from firms attempting to get off by dissolving their company, the Treasury said.

Protecting private firms such as insurers and utility companies from fraud also saved £119million and stopped premiums and bills spiralling for honest customers.

In total, more than £400million of taxpayers’ and businesses’ money was returned to the public purse or protected through counter-fraud action last year, enough to pay for 12,600 new NHS nurses, Mr Healey is set to reveal at the Budget.

A HMT spokesman said: ‘We will go after scammers and fraudsters who cheat the British public. Only by making sure that every pound of taxpayers' money is protected from fraudsters will we be able to deliver the breathing space businesses and families deserve.’