There could be real-time digital checks to make sure claimants are eligible
The DWP has been granted new powers to check the bank accounts of millions of benefit claimants. Investigators will contact bank providers to get information about accounts linked to people claiming Universal Credit, Employment and Support Allowance, and Pension Credit, as part of a new bill. The data will be used to check claimants are in fact eligible to receive their payments, and experts say the measures could be extended to other benefits.
Collette Smith, chief customer officer at security checks group SmartSearch, said: “Eligibility checks could logically be extended to any benefit where identity and entitlement verification are important, for example, Child Benefit, Carer’s Allowance, Disability Living Allowance and Personal Independence Payment (PIP). These benefits often have higher reliance on supporting evidence, which can be strengthened with secure, real-time digital verification. “
The new checks are part of a larger raft of new powers to prevent fraud and wrongful payments in the benefits system. The eligibility checks will start to be used from 2026.
A previous Government document introducing the legislation said: “For the eligibility verification measure, 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.” Ms Smith said when exactly the checks are expanded to other benefits will depend on how successful they prove to be.
She said: “Trust is key; extending the powers too quickly without demonstrating that safeguards work could undermine confidence. A phased approach, backed by strong evidence and independent oversight, would help ensure citizens feel protected while the government gains the benefit of reduced fraud and error.”
Taking funds directly from bank accounts
The bill also includes new powers for investigators to directly take an amount from a person’s bank account, where they owe the DWP cash and are refusing to pay up. In announcing the new powers becoming law, DWP minister Andrew Western said: “If those who can afford to refuse to pay back what they owe, we’ll take the money straight from their accounts and in some cases we’ll take their driving licences too.”
The power to suspend someone’s driving licence will be used where the DWP has tried to recover funds but there is still £1,000 or more owed. If the DWP want to use the direct deduction powers, they will notify the person so they have a chance to dispute the issue.
Officials will also get at least three months of bank statements for the person’s account, to make sure they have the funds available. The deduction can be in a single payment for the whole amount or in regular instalments.
