The Department for Work and Pensions (DWP) has gained controversial new powers to check the bank accounts of state pensioners under new rules aimed at tackling benefit fraud. These powers will apply to low-income households claiming Pension Credit, as well as Universal Credit and Employment and Support Allowance (ESA).
New 'Spy' Powers for DWP
Under the new measures, banks will be required to share account information with the DWP if there is suspicion of fraud or wrongful payments. Ministers argue this will help reduce the billions wasted in benefit fraud each year. However, critics have raised privacy concerns, calling the move a step too far.
Targeting Pension Credit
The inclusion of Pension Credit is notable, as the benefit is already massively underclaimed. Nearly a million eligible over-65s do not claim it, meaning the government would pay out significantly more if all eligible individuals applied. Officials will be able to check savings and other income to verify eligibility.
DWP Statement
A DWP spokesperson said: "Our Fraud, Error and Recovery Bill includes an Eligibility Verification Measure which will require banks to share limited data on claimants who may wrongly be receiving benefits – such as those on Universal Credit with savings over £16,000. As well as tackling fraud, the new powers will also help us find genuine claim errors sooner, stopping people building up unmanageable debt. This measure does not give DWP access to any benefit claimants’ bank accounts."
Concerns from MPs
Sir Geoffrey Clifton-Brown, chair of the Public Accounts Committee, warned about the potential overreach. He stated: "Make no mistake, the DWP’s new powers to reach further into citizens’ lives are significant. Our Committee of course firmly supports Government in its responsibility to ensure people are paid the correct benefits. But it is essential that these extensive new powers - of compulsion of disclosure over banks and financial institutions, of recovering funds directly from people’s accounts without the aid of the courts – have the risk of overreach mitigated against right from the outset."
