Andy Burnham's government has scrapped plans to check the bank accounts of Universal Credit claimants to see how much money they hold in savings. The previous plan would have allowed the Department for Work and Pensions (DWP) to examine welfare claimants' bank accounts to check for fraud, according to reports.
The aim was to catch people claiming Universal Credit when they were not eligible, ensuring individuals were not hiding savings to claim benefits they were not entitled to.
Chancellor John Healey drops the plan
Chancellor John Healey is now said to have scrapped the plan that would have allowed the government to see the savings of people trying to claim Universal Credit, the Telegraph newspaper reported.
Under Universal Credit rules, if you have less than £6,000 in savings, it generally does not affect your entitlement. If you have between £6,000 and £16,000, your benefits may be reduced. However, those with more than £16,000 in savings are ineligible to claim unemployment benefits.
Rachel Reeves' original proposal
Rachel Reeves announced the plans when she was chancellor and claimed that this would help save £200 million a year in benefit fraud.
The government is now said to have replaced the counter-fraud proposals with a new scheme that will see banks conduct checks on welfare claimants' accounts after they have started receiving Universal Credit. They would then report suspicious findings back to ministers, the Telegraph said.
The newspaper suggested the change could lead to higher levels of fraud going undetected.
