DWP will look for 'two things' when it starts checking benefit claimants bank accounts

The Department for Work and Pensions (DWP) has outlined the two main factors it will be scrutinising when its new powers to inspect benefit claimants' bank accounts come into effect. These new powers are part of an effort by the DWP to decrease fraud, debt, and error within the benefits system.

One of the most contentious aspects of this initiative is the granting of authority to DWP investigators to examine claimants' bank accounts. This measure, referred to as "Third Party Data Gathering", is a form of "data sharing" power. The DWP states that it necessitates third parties, such as banks, to supply pertinent information that could indicate a claimant does not fulfil the eligibility requirements for the benefit they are receiving - for instance, having excessive savings.

Under the current Universal Credit regulations, you are ineligible if you possess over £16,000 in cash, savings, and investments. The DWP has declared this will be its "main priority".

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In addition, it will also track whether claimants are residing abroad for longer than permitted by the rules. A recent amendment to the bill - which is presently progressing towards the House of Lords - also compels banks to monitor their customers who receive these benefits, and report to the DWP if an account exceeds the capital limit or is utilised overseas for more than four weeks, reports the Mirror.

The DWP has reassured people that under new measures they will only receive "limited and relevant" information, which could indicate potential benefit fraud. However, this won't include access to bank accounts or insight into claimant expenditure.

Previously, the DWP announced plans to monitor accounts from the UK's top 15 banks, covering 97% of benefit claimants' accounts, including those with Bank of Scotland, Barclays, Halifax, HSBC, NatWest, Santander and TSB.

The department has emphasised that identified claims will be investigated as usual, with no automatic penalties applied. It also stated in a recent assessment document that there will be no "automatic decisions" made solely on data, ensuring caseworkers consider potential vulnerability of claimants and use automation responsibly.

The same document expressed: "[This] measure can potentially include vulnerable people, [and] these areas will be explored further in the equality impact assessment. We are clear, however, that no automatic decisions will be made based on data alone, and DWP staff will follow the usual business processes when looking into any cases, taking account of circumstances and wider vulnerabilities before deciding on a course of action."

Despite such assurances, the measures continue to stir controversy among campaigners who argue that it treats means-tested benefit claimants as "criminal by default".

Silkie Carlo, director for Big Brother Watch, warned: "Such proposals do away with the long-standing democratic principle in Britain that state surveillance should follow suspicion rather than vice versa. It would be dangerous for everyone if the government reverses this presumption of innocence. This level of financial intrusion and monitoring affecting millions of people is highly likely to result in serious mistakes and sets an incredibly dangerous precedent."

A spokesperson for DWP argued that these measures would zero in on areas where fraud and error are rife, such as Universal Credit. They added: "These changes will not allow DWP direct access to bank accounts, but will require third parties to share data signalling fraud with us so it can be considered further. It will also help identify people who have made a genuine mistake with their claim, preventing them from potential debts."

These proposed changes were originally mentioned in the 2022 policy paper titled "Fighting Fraud in the Welfare System", which can be accessed here.