The DWP has confirmed when its new powers could start being used
A series of new measures to tackle fraud have been announced, in what the UK Government has dubbed the “biggest fraud crackdown in a generation”. The Public Authorities (Fraud, Error and Recovery) Bill, which was announced earlier this year, is expected to save over £1billion by granting the Department for Work and Pensions (DWP) new powers to investigate and recover money that has been fraudulently claimed through the benefits system.
The DWP has now officially confirmed the date this Bill will be implemented, as it released a series of factsheets detailing all the new measures. It stated: “The Government will begin implementing the Bill measures from 2026.”
One measure that has raised concerns among benefit recipients is the Eligibility Verification Measure. This will require banks and financial institutions to “examine their own data” and report back to the DWP.
This could help the department tackle fraud by identifying individuals who may not qualify for the benefit or amount they are claiming. For instance, if they have too much in savings or have received an income increase that they haven’t reported yet.
It’s important to note that this will not give the DWP direct access to claimants’ bank accounts. Nor will the department be able to see information on how claimants spend their money.
To ensure that benefit claimants still feel protected, banks will only be permitted to share limited information with the DWP. In fact, institutions that share too much information could actually face a penalty.
The factsheets added: “The Government will implement a ‘test and learn’ approach to ensure the new powers to tackle public sector fraud are being used proportionally and effectively. DWP and the Cabinet Office will continue to work with industry to implement the new measures, consult stakeholders on Codes of Practice and publish guidance.”
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As reported by the Daily Record, the DWP is set to gain authority to collect data from an expanded pool of third-party entities such as airlines, aiming to identify individuals who may be claiming benefits from abroad, thus breaching eligibility criteria. Furthermore, the proposed legislation will bolster the DWP’s abilities for recovery, potentially enabling them to extract owed sums directly from offenders’ wages or bank accounts.
The new sanctions proposed in the Bill are intended to go beyond monetary penalties. Repeat offenders who consistently avoid repaying what they owe could find themselves handed a driving ban for a duration that may extend up to two years.
The Bill also introduces other changes such as:.
- New powers of search and seizure, enabling the DWP to lead investigations into criminal gangs defrauding taxpayers.
- The DWP will now be able to recover debts from individuals who are no longer on benefits and not in PAYE employment but can afford to repay their debts and have avoided doing so.
- Banks and building societies will now be required to flag any indications of a breach in eligibility rules for benefits, preventing debt accumulation.
- All these powers will come with strong safeguards to ensure they are used appropriately and proportionately, including new inspection and reporting mechanisms.
- The DWP will have a clearly defined scope and clear limitations for the use of all the powers it is introducing, and staff will be trained to the highest possible standards.