Motorists with outstanding DWP benefit debts are being warned they could face a temporary driving ban under new debt recovery powers rolling out from October.
The measures, in force since June, give the department greater options for recovering money owed, including taking certain debts directly from bank accounts and, in the most serious cases, applying to a court for a driving disqualification.
The driving ban will not apply to everyone with a benefit debt. The DWP says it is a last resort for people who have persistently avoided repayment. The debt must be at least £1,000 and the person must have the financial means to repay it.
Court decides on disqualification
The DWP can apply to a court for a temporary driving disqualification where it believes someone has deliberately failed to repay their debt without good reason. A court, rather than the DWP, will decide whether a ban is imposed. The court must be satisfied that the person could afford to repay and failed to do so without reasonable grounds.
Safeguards are built into the process. A person's circumstances, including whether they have an essential need for their driving licence, can be taken into account. Initially, a disqualification order can be suspended while the debtor makes agreed repayments. A ban could then be imposed if they miss those payments without a reasonable excuse.
The DWP said: "Money owed to DWP can now be recovered from an individual's bank account by issuing a direct deduction order to their bank for repayment."
Closing a loophole
The measures are intended to address debts owed by people who are no longer receiving benefits or are not in suitable PAYE employment, where the DWP previously had fewer options to recover money.
DWP officials said: "Previously, the DWP had few options to pursue people who were no longer claiming benefits or in PAYE employment, meaning some who could afford to repay were simply choosing not to. That loophole is now closed."
The department is also gaining new powers to recover certain debts directly from bank accounts through Direct Deduction Orders. These can be used following an assessment of a person's ability to repay.
Minister: 'Door is open'
The government has stressed that the new measures target people who deliberately avoid repaying money they can afford to return, rather than those struggling financially.
Work and Pensions Minister for Transformation Andrew Western said: "Hardworking taxpayers deserve a system that pursues those who deliberately dodge their debts, and that is exactly what these new powers deliver.
"To anyone with an outstanding debt - our door is open and DWP will always work with you to find an affordable way to repay.
"But for those who can pay and won't - we're going further than ever before to claw back cash and crack down on fraud."
People who have received letters from the DWP about outstanding debts are being encouraged to contact the department and arrange repayment rather than wait for enforcement action. The new enforcement measures are being gradually rolled out from October, with a warning that persistent debtors could face stronger action if they refuse to repay money they can afford.
