The Department for Work and Pensions (DWP) will be given new powers to view the bank accounts of benefit claimants, under a bill making its way through Parliament
Sweeping changes to legislation will grant DWP officials extensive powers to scrutinise benefit claimants’ bank accounts. A bill currently progressing through Parliament includes provisions for eligibility checks, enabling investigators to compel banks to surrender account information for those receiving specific benefits.
The measures will initially target millions of people claiming Universal Credit, Pension Credit and Employment and Support Allowance. However, the legislation indicates this could be expanded to cover additional benefits.
George Kampanella, head of business crime and regulatory at law firm Taylor Rose, said: “This legislation could offer a major step forward in improving how Government departments can verify the eligibility of claimants and use anti-fraud tools to identify fraud cases and recover funds”, reports the Express.
He discussed how the fresh measures could assist in reclaiming lost money: “By enabling secure and lawful data sharing, the initiative could vastly improve fraud detection, eligibility verification, and the recovery of public funds. For the Department for Work and Pensions (DWP), it would provide more practical powers and access to tools that enable efficient, targeted recovery, reducing delays and increasing accuracy.
“The ability to verify income and savings directly could vastly improve the accuracy of benefit payments and reduce over-payments, particularly in cases like Universal Credit, where changes in circumstances often go unreported.”
The legislation also includes powers for officials to directly take an amount from a person’s bank account, in cases where a person owes the DWP cash and is refusing to pay up despite being requested to do so. In these cases, the department will have to request at least three months’ bank statements for the person’s account, to make sure they have the funds available.
Officials can deduct the amount in one lump sum or in instalments. The DWP can currently recover owed amounts through deductions from a person’s benefit award, or through PAYE.
The DWP said previously the new bill would help recover £1.5billion in funds. A Government document introducing the bill explains: “The bill will modernise DWP’s powers to ensure money spent is reaching those who need it, and not those who exploit the system.
“This will result in more money being recovered, more robust action being taken against those who attack the system, and an increased deterrent to potential fraudsters. The powers contained in this bill to address overpayments in the social security system will be tough on criminals and fair for the taxpayer – and DWP claimants – that money in the public sector is spent wisely and effectively.”
Mr Kampanella spoke about how the measures in the bill could be used more widely. He said: “The opportunity for wide-ranging application and departmental crossover is also significant.
“HMRC could benefit from enhanced fraud detection, supporting more accurate and timely identification of fraud and tax evasion, while also improving customer service through better data integration. Beyond HMRC, departments such as the Home Office and the Department for BEIS [Business, Energy & Industrial Strategy] could benefit from streamlined case management, faster eligibility checks, and improved policy targeting.”
He went on to say that the alterations to these powers must be meticulously crafted to prevent overreach and safeguard people’s rights. The legislation sets out that an independent individual will be appointed to monitor the implementation of these measures, ensuring they are utilised appropriately and prove effective in meeting their objectives.