A reform UK MP has sought clarification from the Department for Work and Pensions (DWP) on proposed new powers to ‘monitor bank accounts’ of benefit claimants as part of the UK Government’s plan to tackle fraud in the welfare system. In a series of eight written questions to the DWP, James McMurdock, challenged the proposed measures including how investigators accessing information will be monitored, rights of claimants, impact on data protection and what types of data will be collected.
However, in his response, DWP Minister Andrew Western emphasised that the proposed Fraud, Error and Debt Bill “will not give DWP access to any bank accounts, nor any information on how claimants spend their money”adding that banks and financial institutions will share “limited information” with the Department to “help verify benefit eligibility by flagging possible conflicts with eligibility rules”.
The DWP pays benefits to more than 23 million people across Great Britain. Fraud and error in the welfare system currently costs the taxpayer almost £10 billion each year and since the pandemic a total of £35bn has been incorrectly paid to those not entitled to the money, however, it’s important to be aware this also includes criminal gangs, not just benefit claimants.
Fraud and error in the social security system currently costs the taxpayer almost £10 billion a year and, since the pandemic, a total of £35 billion of taxpayers’ money has been incorrectly paid to those not entitled. We are determined to reduce those levels.
In his written response to Mr McMurdock on Wednesday, the DWP Minister said: “As set out by the National Audit Office, access to data is key to prevention and detection of incorrect payments. The Eligibility Verification Measure (EVM) in the proposed Fraud, Error and Debt Bill will not give DWP access to any bank accounts, nor any information on how claimants spend their money.
“It will require banks and financial institutions to share limited information with the DWP to help verify benefit eligibility by flagging possible conflicts with eligibility rules – for example the £16,000 capital limit in Universal Credit. The information gathered will help DWP identify incorrect payments, prevent debts from accruing for the claimant and help identify where there may be fraudulent activity.”
He added: “The legislation will set out key safeguards, including reporting mechanisms and independent oversight. No benefit entitlement decision will be made solely because of the data obtained under EVM and a final decision on benefit entitlement will always involve a human agent.
“If a claimant wishes to challenge or appeal a benefit decision, they can do so following DWP’s appeals processes.”
In another written response to the Reform UK MP, Mr Western confirmed that the State Pension “will be excluded from the scope of this measure given its near universality and minimal eligibility requirements”.
He added: “DWP will ensure that any data is processed and held in compliance with UK GDPR and the Data Protection Act 2018. Compliance with data protection legislation is also overseen by the Information Commissioner’s Office.”
Mr Western also said that further details will be set out when the Bill is introduced to Parliament.
New DWP fraud measures
The measures in this Bill will remedy that, giving DWP powers to:
- Better investigate suspected fraud and new powers of search and seizure, so DWP can take greater control of investigations into criminal gangs defrauding the taxpayer.
- Make changes to the penalties system, so no one found to have committed fraud against the social security system avoids punishment, bringing increased fairness for claimants who do the right thing.
- Allow DWP to recover debts from individuals who can pay money back but have avoided doing so, bringing greater fairness to debt recoveries.
- Eligibility Verification – require banks and financial institutions to examine their own data sets to highlight where someone may not be eligible for the benefits they are being paid.