DWP update on bank account checks coming in targeting people on three benefits

Investigators will also be able to directly take funds from a person’s bank account

Sweeping new DWP powers are set to crack down on benefit fraud, including bank account checks for claimants. Legislation was passed last year introducing a range of new powers, enabling investigators to request banking information for people receiving certain benefits.

Officials will approach UK banking providers, instructing them to scrutinise their records for accounts connected to particular benefits, to flag any accounts that may be ineligible for their payments. The new legislation also grants the authority to withdraw funds directly from a person’s bank account should they owe the DWP money and refuse to repay the debt. The eligibility checks will initially target those claiming Universal Credit, Pension Credit, and Employment and Support Allowance. This could be extended to other benefits.

The DWP has now issued an update on when these bank checks will actually start to be used. Officials confirmed that they have not yet been put into practice as some things need to happen first.

As these bank account checks are rolled out, the DWP is first undertaking a ‘test and learn approach’ to trial the new powers, which is due to commence this year. In the meantime, the DWP is currently developing code of practices governing the use of these new powers.

The DWP said the final version of these codes will be presented to Parliament “before any new powers can be used”. The direct deduction powers, whereby investigators can withdraw a sum directly from a person’s bank account, are intended to target people who have left the benefits system and still have outstanding amounts to repay.

Previously, the DWP could only recover funds through a person’s PAYE earnings or via deductions from their benefits. Should the DWP plan to exercise this power, they will notify the people, giving them an opportunity to challenge the matter.

Officials will also ask for three months’ worth of bank statements to confirm that the person has sufficient funds in their account. The legislation additionally provides expanded powers for fraud investigators to request information during an investigation.

Previously, they were limited to demanding information from a restricted list of sources. They can now approach any third party connected to the person suspected of fraud, compelling them to hand over the required details.

When the powers were enshrined in law 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.”