New DWP powers to check bank accounts of Universal Credit and Pension Credit claimants will be rolled out this year as part of a major benefit fraud crackdown
The Department for Work and Pensions (DWP) is being granted sweeping new powers to crack down on benefit fraud, including the ability to scrutinise claimants’ bank accounts.
Legislation passed last year introduced a broad range of measures, enabling investigators to request financial information from individuals receiving certain benefits. Officials will contact UK banking institutions, directing them to examine their records for accounts linked to specific benefits, flagging any that may be receiving payments to which claimants are not entitled.
The new laws also grant authorities the power to withdraw funds directly from a person’s bank account should they owe money to the DWP and refuse to repay the debt. Initially, the eligibility checks will be applied to those claiming Universal Credit, Pension Credit, and Employment and Support Allowance.
The legislation indicates that this could be extended to cover additional benefits. The DWP was approached for an update on when these bank checks will come into effect, with officials confirming that they have yet to be implemented, as certain prerequisites must first be met.
As part of the rollout, the DWP will adopt a ‘test and learn approach’ to trial the new powers, which is set to commence this year. In the meantime, the DWP is currently drafting codes of practice governing the use of these new powers, with finalised versions to be presented to Parliament “before any new powers can be used”. The direct deduction powers, which enable investigators to withdraw funds straight from an individual’s bank account, are chiefly targeted at those who have exited the benefits system but still owe outstanding debts.
Previously, the DWP was restricted to recovering money through an individual’s PAYE earnings or via deductions from their benefits, reports Chronicle Live.
Should the Department for Work and Pensions (DWP) decide to utilise this authority, they will contact the individual in question, offering an opportunity to contest the matter. Officials will also need three months’ worth of bank statements to verify that adequate funds are available in the account.
The legislation also provides enhanced powers to fraud investigators when conducting enquiries. Previously, they were restricted to requesting information from a limited list of sources.
They can now contact any third party linked to the individual suspected of fraud, requiring them to supply the necessary information. When the laws were introduced in December 2025, Andrew Western, minister for Transformation, said: “It is right that as fraud against the public sector evolves, the Government has a robust and resolute response.
“The powers granted through the bill will allow us to better identify, prevent and deter fraud and error, and enable the better recovery of debt owed to the taxpayer. A benefits system people can trust is essential for claimants and taxpayers alike – through this bill that’s exactly what we’ll deliver.”

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