The Department for Work and Pensions (DWP) has been given new powers to request access to view the bank accounts of claimants – but one benefit is exempt from the new law
Fresh legislation now grants DWP officials the authority to scrutinise claimants’ bank accounts in a crackdown on benefits fraud, with banks required to provide information about accounts associated with specific benefits. One benefit, however, remains untouched by these new rules.
Dubbed the Eligibility Verification Measure, this new authority will initially target recipients of three key benefits: Universal Credit, Pension Credit and Employment and Support Allowance.
The legislation allows for potential expansion to cover additional benefits in future. “DWP will be gradually rolling out the use of the Eligibility Verification Measure in a test and learn environment to allow for sufficient time for business to establish best processes,” a government document stated.
A DWP spokesperson indicated the initiative is projected to deliver £2.1billion in taxpayer savings over five years, forming part of broader measures expected to save £14.6billion.
Notably, the State Pension sits outside the scope of these powers and cannot be included alongside other benefits. As a non-means-tested benefit, the State Pension occupies a distinct classification, reports the Express.
“The legislation includes an Eligibility Verification Measure which will require banks to share limited data on claimants who may wrongly be receiving benefits,” the spokesperson added. “It does not involve access to benefit claimants’ bank accounts.”
Whilst the legislation allows for additional benefits to potentially fall under this new measure in future, the DWP has confirmed there are no immediate plans to extend it.
The department has also given assurances that no personal data will be disclosed.
A government document states: “If the Secretary of State wishes to expand the range of benefits covered, it will require a debate and approval by Parliament. This is except for the State Pension, which is excluded from being added by the legislation.”
The new legislation also grants powers to directly withdraw funds from bank accounts. This could occur when an individual has outstanding debts to the DWP and is declining to settle them.
Previously, the DWP’s options were limited to recouping owed sums through benefit deductions or via PAYE salary deductions.
Under the legislation, banks and financial institutions face potential penalty notices if they fail to comply with Eligibility Verification Notices. To dodge such penalties, banks must respond within specified deadlines.
Financial institutions could also incur fines for inappropriately disclosing information that should remain confidential under the new provisions.
