The Department for Work and Pensions (DWP) has been granted new powers to clamp down on wrongful benefit payments through expanded digital checks on claimants' bank accounts. The Eligibility Verification Measure will allow the DWP to instruct account providers to review accounts linked to Universal Credit, Pension Credit, and Employment and Support Allowance (ESA) to identify potential ineligibility.
The DWP has stated it will not have direct access to people's accounts, with banks only sharing limited data with investigators. The newly approved legislation also enables officials to directly withdraw money from the bank accounts of individuals who owe the DWP and are refusing to repay, targeting those who have left the benefits system.
Official estimates suggest the new powers will save taxpayers £2.1 billion over the next five years. However, critics warn the measures could unfairly intimidate claimants. Phil Cotter, chief executive of anti-fraud specialists SmartSearch, said there is a real risk that honest claimants may be discouraged from contacting the DWP about changes to their circumstances if the powers are not used carefully and communicated clearly.
The Public Accounts Committee, which scrutinises Government expenditure, has demanded more safeguards and annual updates on how the measures are being deployed. Cotter emphasised that bank account monitoring should be an incredibly useful tool for detecting incorrect payments, but warned it must be used alongside other checks to avoid false positives.
He cautioned that acting on information from a bank account check alone could easily lead to innocent people being mistakenly targeted. The most effective use would be to combine bank data with digital identity verification and cross-checks with HMRC and other government data.
When the legislation was 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.'
