Fresh concerns have been raised that new government powers designed to tackle benefit fraud could inadvertently target innocent claimants, leading to payments being wrongly stopped.
What are the new DWP powers?
The Department for Work and Pensions (DWP) has been granted a sweeping range of new legal powers aimed at clamping down on wrongful and fraudulent benefit claims. These measures, which have recently become law, include two key provisions.
Firstly, officials will gain the authority to directly remove funds from a person's bank account if they owe money to the DWP and are refusing to pay the debt.
Secondly, and more broadly, the DWP will conduct eligibility checks by requesting bank account information for people claiming certain benefits. These checks will initially apply to claimants of Universal Credit, Employment and Support Allowance, and Pension Credit, with the potential to expand to other benefits later. The department plans to start using these powers in 2026.
Experts warn of risks and 'false positives'
Compliance and security experts have voiced significant apprehension about the potential for error within the new system. Collette Smith, Chief Customer Officer at SmartSearch, highlighted the inherent risks.
"There are always risks in any system that relies on data checks, whether manual or automated," she said. "False positives can arise if data is incomplete, outdated, inputted incorrectly or misinterpreted."
She warned that without proper safeguards, people could end up having legitimate benefits suspended or be wrongly suspected of fraud. Smith gave examples of how innocent activity could trigger an alert, such as a temporary change in income, the use of a shared household account, or simply the way a bank categorises transactions.
Safeguards and the limits of DWP access
In response to concerns, the DWP has confirmed a crucial limit to its new authority. It will not have direct, live access to anyone's bank account. Instead, for eligibility checks, officials will contact banking providers to request specific information about accounts linked to benefit claims. They will not be able to see transaction histories or what claimants spend their money on.
The legislation also mandates the appointment of an independent person to oversee the use of the powers, ensuring they are used effectively and appropriately.
Furthermore, fraud investigators have been given expanded powers to order third parties to hand over information during a suspected fraud investigation, moving beyond a previously restricted list.
A call for 'smarter, not broader' authority
When asked if the DWP should receive even more powers, Collette Smith cautioned against the assumption that broader authority leads to better results. "The focus should be on smarter, not broader, authority," she stated.
She advocated for stronger digital verification, such as securely matching claimant details with HMRC payroll data and other official records, to prevent fraud before payments are made. "Powers that allow the DWP to use verified sources will be more transformative than blanket access to personal data," Smith concluded.
