The UK Government's crackdown on benefit fraud is now in force, giving banks the power to examine certain benefit claimants' accounts and share information with the Government. The new rule, called the Eligibility Verification Measure (EVM), has been active since October 13.
Around 8.4 million people in more than 7 million households currently claim Universal Credit, bringing total welfare costs for Universal Credit to £80 billion. The UK has spent £1.6 trillion on working-age benefits in the last 20 years.
How the new measure works
The EVM aims to catch benefit fraudsters and identify those who are wrongly receiving payments. It covers those claiming Universal Credit, Pension Credit and New Style Employment and Support Allowance.
Banks are required to provide the Department for Work and Pensions (DWP) with particular details about bank accounts, as well as other financial information, if they receive an EVM notice.
What banks share with the DWP
The DWP explained it will "share certain information with banks and other financial institutions, known as 'eligibility indicators'". These indicators are based on benefit eligibility rules and help institutions identify accounts that may need to be checked by DWP.
Financial institutions will check the information they hold on accounts receiving certain DWP benefit payments. They will tell DWP when a personal account into which a relevant benefit is paid meets an eligibility indicator, including linked accounts. The account may belong to either a claimant or a non-claimant.
The information banks can share includes account holder names, details of other accounts (including joint ones), account numbers and sort codes, how much money is in accounts and transaction dates. However, they cannot share full bank statements, details of how money is spent, specific transaction locations, or personal information about backgrounds or religions.
What happens next
The DWP stated: "If information shared by your bank suggests you may be getting an incorrect benefit payment, DWP will review your claim. You must keep your information up to date so that you get the correct amount of benefit. Any delay may mean you receive too much money and may have to make a repayment."
Those who disagree with a decision made about their eligibility will have the right to ask for it to be reviewed again, as part of a "mandatory reconsideration".
