Investigators will check the eligibility for people on three benefits
New laws which include DWP eligibility checks for certain benefits could be expanded with more “proactive” data checks. Legislation is being considered in Parliament which includes powers for DWP investigators to request bank account information for claimants, to make sure people are eligible for their payments.
The eligibility checks will initially be used to check the accounts of people on Universal Credit, Employment and Support Allowance, and Pension Credit. But the draft bill states that the measure could be expanded to other benefits.
Siobhan Blagbrough, financial crime expert at Ocean Finance, said errors in benefit payments are “more common than many realise”. She explained: “Overpayments arise because claimants fail to report changes in circumstances, or because there are delays and mistakes in the processing system. Underpayments, on the other hand, can happen when data from other Government departments is missing or inaccurate, or when rules are applied inconsistently.
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“Fraud itself accounts for only a small proportion of errors, yet it is often the focus of media coverage, which can make the system feel harsher than it actually is.” The bill also provides fresh powers for investigators to directly take an amount from a person’s bank account, if they owe funds and are refusing to pay the amount.
When these powers are to be used, officials will notify the person in advance to give them a chance to contest the issue. They will also obtain at least three months of bank statements for the person’s bank account, to make sure they have the cash available.
‘Proactive data checks’
Ms Blagbrough spoke about what other measures the DWP could bring in to prevent wrongly payments. She said: “To tackle these issues, the DWP could invest more in proactive data checks and automated alerts for anomalies, without immediately jumping to reclaim funds.
“Staff training and improved guidance for claimants can help reduce reporting errors, and simpler online reporting systems could make it easier for people to update their circumstances quickly. Importantly, any automated processes need human oversight, so that genuine errors are spotted before they result in financial harm.”
The bill mandates that there will be an independent overseer appointed, to make sure the new powers are effective and are used correctly. When Labour announced the bill in January 2025, former secretary of state for work and pensions, Liz Kendall, said: “We are turning off the tap to criminals who cheat the system and steal law-abiding taxpayers’ money.
“This means greater consequences for fraudsters who cheat and evade the system, including as a last resort in the most serious cases removing their driving licence. Backed up by new and important safeguards including reporting mechanisms and independent oversight to ensure the powers are used proportionately and safely.
“People need to have confidence the Government is opening all available doors to tackle fraud and eliminate waste, as we continue the most ambitious programme for government in a generation – with a laser-like focus on outcomes which will make the biggest difference to their lives as part of our Plan for Change.”