Senior MPs are concerned about how the ‘draconian’ powers will be used
An MP committee has called for new safeguards for ‘draconian’ new anti-fraud powers granted to the DWP. New legislation to clamp down on fraud and erroneous payments grants sweeping new powers to officials. These include eligibility checks to look at the bank account information of people claiming certain benefits.
These checks will initially be used to look over the account details of those claiming Universal Credit, Pension Credit and Employment and Support Allowance, to make sure they are eligible for their payments. The measure could be expanded to other benefits.
The newly approved laws also allow investigators to directly take an amount from a person’s bank account, in cases where they owe the DWP cash and are refusing to settle the debt. These powers will be used to target people who owe cash and who have left the benefits system.
The DWP can get things wrong
The legislation provides for an independent overseer to monitor the use of the powers, but the Public Accounts Committee is now calling for further safeguards. Committee chair, Geoffrey Clinton-Brown, said: “Being able to take money out of people’s bank accounts without a court order, compelling banks and other financial institutions to give information, are significant extra powers that the DWP have got.
“We are concerned particularly in light of the Carer’s Allowance issue, where 26,000 people were sent demands for overpayment of the allowance, when they hadn’t been able to report it properly, and they are going to be refunded. That gives an example of where the DWP could get things wrong, with these quite draconian new powers.”
The committee oversees the use of public funds for Government projects, to make sure departments are spending money wisely and effectively. They want the DWP to provide an annual report to them about the use of the anti-fraud powers.
Mr Clinton-Brown said: “We have made a recommendation that the DWP have to report to us once a year, a full report on where and how they have used these powers. If we get the slightest impression that they are being used unreasonably, we will start to have an investigation and call them in and ask them to account for themselves.”
He gave an example of where the committee would demand answers from the DWP: “Suppose they started to go after people on Universal Credit for a particular aspect. We would want to be assured that the use of that power was reasonable in those cases.”
Nonetheless, the committee head said he thinks the new powers to directly take an amount from a person’s bank account are appropriate in some cases, if someone continues “committing what is a serious effort to defraud the taxpayer”.
Mr Clinton-Brown explained: “This is taxpayers’ money. If it’s being overpaid in one area, it’s then putting pressure on the funds available if the Government wanted to increase benefits in another area. I think it is incumbent on the DWP to try and get these things right.”
Claimants will be worried
But he said he understands that claimants may be concerned that DWP officials have been equipped with such new powers. The Conservative MP said: “I have a lot of sympathy with people over these powers, they will be worried.
“That’s why I think it’s incumbent on the DWP to make it absolutely clear in their communications, by better communications, that it’s only going to be used in the most extreme cases where people have been warned, hopefully several times, before these powers are used.” The legislation sets out that if the DWP wants to make a direct deduction from a bank account, they must get at least three months of bank statements for the account, to ensure the person has the funds available.
The DWP must also notify the person that they intend to take the amount, giving them at least 28 days’ notice to dispute the matter. Mr Clinton-Brown was asked what other measures could be brought in to tackle fraud and error in the benefits system. He said the latest technology, such as AI, could help with this, as well as better data sharing among Government departments.
He said: “They [the DWP] do a very good job of linking in with HMRC on things like PAYE, but there are other areas. You could imagine, for example, local authorities, the Department for Education, where they could get information. They themselves admit that they could do more to try and reduce the rate of fraud and error.”
When the laws were approved, DWP minister Andrew Western said: “It is right that as fraud against the public sector evolves, the Government has a robust and resolute response. The powers granted through the bill will allow us to better identify, prevent and deter fraud and error, and enable the better recovery of debt owed to the taxpayer. A benefits system people can trust is essential for claimants and taxpayers alike – through this bill that’s exactly what we’ll deliver.”
