DWP confirms how it plans to monitor people's bank accounts

The dates people will receive benefits over the Easter bank holiday period have been confirmed
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The Department for Work and Pensions (DWP) has provided an update on its plans to monitor people's bank accounts. New measures in the Data Protection and Digital Information Bill would require the top 15 banks in the UK to set up alerts on accounts owned by benefit claimants.

Work and Pensions Secretary Mel Stride, addressing concerns, offered more information about how the scheme would work. He reassured individuals that it doesn't mean the Department will have access to accounts to scrutinise claimants' spending.

Instead, it would highlight when capital limits have been exceeded or when there are foreign transactions suggesting people are abroad for longer than permitted. A trial of the new measures at a single bank has already discovered 60,000 people had too much money saved to be eligible for benefits.

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The average monthly balance of these accounts was £50,000, while the maximum amount for claiming Universal Credit is £16,000. An additional 3,000 accounts indicated signs of individuals residing overseas for too long to qualify for benefits, Birmingham Live reports.

Mr Stride addressed the Work and Pensions Committee, highlighting upcoming legislative changes: "There are a couple of things happening. One is a Bill in the next Parliament that will be about the HMRC alignment point.

"There are also amendments that we put through in the DCMS (Department for Digital, Culture, Media and Sport) digital Bill, which relate to the ability to try to establish the answer to the question that you have asked: How do you know if somebody qualifies for a benefit where qualification may hinge, for example, on the capital that they have in their bank account?"

"You do see that within Pension Credit. You also see it within Universal Credit.

"Within Universal Credit, the level of fraud and error is quite significantly higher, for example, than in other benefits on average across the suite of benefits that we have. Therefore, it is important to have some way of trying to understand who might be in a situation where they are claiming when they should not be.

"If we take capital fraud within Universal Credit, what our proposals are doing is giving us the ability through third parties, such as banks, to identify people where there is a signal that they may be receiving the benefit inappropriately; not to delve into their bank account and look at what they are spending all their money on and so on, as we have existing powers to do that where we have a clear suspicion of fraud or error."

The Permanent Secretary of Department for Work and Pensions, Peter Schofield, has stated that data analysis is crucial to the Government's fight against benefit fraud. Claimants' earnings notifications from the tax office serve as proof of this, he said.

Mr Schofield clarified: "We know precisely what people have earned who are claiming Universal Credit. Fraud and overpayment from people in employment in Universal Credit last year was 0.0 per cent.

"It worked out at about £11 million in total, whereas fraud from the self-employed in Universal Credit was well over £1 billion. That is the difference that you get in terms of access to data."

Sir Desmond Swayne, Tory MP for New Forest West, said: "You are going to use advanced analytics and machine learning. I think the Secretary of State just implied that that would be intelligence-led because you spoke of who might be claiming when they are not entitled to and the signals that would give rise to that.

"It strikes me as perfectly proper that it should be intelligence-led, but how do you square that with accusations that might be made that by targeting the criminal classes you are targeting elements of the community unfairly?". In response, Mr Schofield assured that these checks are merely broad indicators of potential issues with benefit entitlement. Data, according to him, is a tool that aids the DWP to "look through the haystack and start to identify where the needle might be".

He concluded: "The decisions that are made about any individual claimant and their circumstance is always made by a human being looking at the evidence. I do want to reassure everyone that that is at the heart of everything here.

"It is about giving our people more tools to look in a more focused way to find those needles in those haystacks more accurately." The new amendments to the Data Protection and Digital Information Bill were not passed before Parliament was dissolved for the General Election, so the proposed powers intended to come in next year are not yet legislation.

In addition, the Conservatives are preparing a new Fraud Bill for the next Parliament that will treat benefit fraud like tax fraud and provide new powers to make seizures and arrests.