Ministers have been urged not to revive Conservative plans to tackle welfare fraud through mass algorithmic surveillance of bank accounts. In a letter to Work and Pensions Secretary Liz Kendall, disability rights, poverty, pensioner and privacy groups warned that requiring banks to scan accounts for suspicious behaviour would be a “huge blow to privacy in the UK”.
The Labour government's Fraud, Error and Debt Bill, announced by Keir Starmer last week, would compel banks to share data on account holders that “may show indications of potential benefit overpayments”. The Department for Work and Pensions (DWP) stressed that it would not have direct access to accounts or use artificial intelligence, and that any signal of fraud or error would be investigated by a member of staff.
The groups, including Disability Rights UK, Age UK, Privacy International and Big Brother Watch, argued the powers would be disproportionate and risked a “Horizon-style scandal”. They said imposing “suspicionless algorithmic surveillance” on the entire population would most harm vulnerable people, such as pensioners and disabled individuals.
The DWP estimated the measure could save £1.6bn over five years, but only address around 3% of the £10bn lost annually to fraud and error. The previous Conservative bill failed to pass before the election. The warning comes amid wider use of AI in government, with about 70% of departments piloting or planning such tools.
