DWP gives update on new powers to snoop on benefit claimant bank accounts

The Department for Work and Pensions (DWP) has given an update on its anti-fraud measure to monitor benefit claimants bank accounts.

The update came from a series of eight written responses from DWP Minister Andrew Western. The questions – asked by Reform Party MP James McMurdock – asked for clarification on the new powers, such as how investigators accessing information will be monitored, the rights of claimants, the impact on data protection, and what types of data will be collected.

In response, the DWP minister said that the proposed Fraud, Error and Debt Bill would "not give DWP access to any bank accounts, nor any information on how claimants spend their money.” He also noted that banks and financial institutions would share "limited information" and this would be used to "verify benefit eligibility by flagging possible conflicts with eligibility rules”. For example, if a claimant has more than £16,000 in savings when claiming Universal Credit.

Western said that the information gathered would help the DWP "identify incorrect payments, prevent debts from accruing for the claimant and help identify where there may be fraudulent activity.” In another written response, the DWP minister confirmed that the state pension would be excluded from the measure "given its near universality and minimal eligibility requirements”.

Labour's DWP is currently working on its Fraud, Error, and Debt Bill, which aims to tackle fraud in the welfare system. According to government figures, fraud and error in the welfare system currently costs the taxpayer almost £ 10billion a year. In the budget, Chancellor Rachel Reeves confirmed that the DWP's counter-fraud team would be given new powers to prevent illegal activity. One of its new powers – and the most controversial – will give the DWP "direct" access to bank accounts to recover debt. Reeves says this package will help it save £4.3billion a year by the end of its forecast.

In his written response to the Reform MP 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.

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.”

Western said the DWP would ensure that any data processed and help would be in compliance with UK GDPR and the Data Protection Act 2018. Compliance. The data protection legislation will also be overseen by the Information Commissioner’s Office. The Labour MP said further details will be provided when the Bill is introduced to Parliament – this will likely be next year.

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