Fears as DWP to get power to raid your bank account in new fraud crackdown
Plans to allow authorities to seize funds directly from individuals' bank accounts as part of a benefit fraud crackdown have sparked concerns that innocent people could be wrongly accused and stripped of their money.
The proposed measures, expected to be included in the upcoming fraud bill, would give investigators the power to take money from bank accounts and wages. Critics warn that this could disproportionately affect vulnerable individuals, echoing the controversy surrounding carers who were forced to repay overpayments of carer's allowance.
Under current rules, recipients of the carer's allowance, which is only £81.90 weekly, cannot earn more than £151 per week. Exceeding this limit by even a small amount results in loss of entitlement and the requirement to repay the entire sum, leading to some families being pursued for amounts up to £20,000.
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Katy Styles, who is an unpaid carer for her husband Mark, who has motor neurone disease (MND), spoke to i about her hopes that the new proposals wouldn't lead to a repeat of the carer's allowance overpayment debacle. She said: "I'm hoping this is a crackdown on organised fraud, as opposed to penalising vulnerable individuals."
The 55-year-old Cambridge resident, and founder of the We Care campaign group, added: "But I'm concerned about how robust protections to protect individual carers and disabled people might be."
Meanwhile, Mikey Erhardt from Disability Rights UK voiced concerns about the Government's track record with benefits and the potential for negative repercussions: "Considering the Government has struggled to keep its own house in order, considering they couldn't sort out (carer's allowance) overpayments and allowed those to rack up, it's concerning. I'm worried about unintended consequences."
He called the proposed measures disproportionate, stating: "These new powers would see millions deprived of the presumption of innocence, adding to the criminalisation we already face in a punitive welfare system." For money-saving tips, sign up to our Money newsletter here
Elizabeth Tait, an unpaid carer from Thames Ditton in Surrey, recounted the "brutal experience" of being ordered to repay more than £1,600 to the Department for Work and Pensions (DWP) after unintentionally breaching the complex earnings threshold for carer's allowance. She said she was "made to feel like a criminal".
Ms Tait, who provided care for her late husband with terminal cancer and claimed personal independence payments (PIP), has spoken out about the undue burden of exhaustive checks on carers and disabled people, given the rigorous nature of the assessment process for claims. Speaking to i, Ms Tait said: "I think disabled people should be exempt from this, because the assessment process to make claims is already so robust. To snoop on disabled people would be cruel."
She called for more clarity and fairness in how repayments were handled, advocating that individuals should be properly informed and communicated with: "They should have to notify people and explain repayments, rather than take money straight out of people's bank accounts. There is a risk it will be implemented the wrong way".
Ms Tait continued: "The Government does make mistakes. There has to be a human element to any investigation – a real understanding of people's circumstances. Because innocent people have been tied up with people who are fraudulent."
The upcoming Fraud, Error and Debt Bill will arm the authorities with new capabilities to directly reclaim funds from the bank accounts and pay checks of those who have received excess benefits, reports the Liverpool Echo. In anticipation of the legislative changes, Work and Pensions Secretary Liz Kendall remarked it is "absurd" that such investigative powers haven't been improved in two decades. She said: "Our bill will give them similar powers as HMRC to investigate fraudsters – it's time we give them the tools they need for the fight."
Addressing concerns regarding oversight, Ms Kendall promised there would be a reliable check on proceedings, stating: "There will always be a human to check over fraud investigations to make sure any investigation is right and necessary".
Clarifying details on the bill, the DWP explained last month that while direct government access to private bank accounts was not permitted, the legislation did "allow DWP to recover debts from individuals" and compels banks to "to share data that may show indications of potential benefit overpayments". The Government estimates fraud and error within the welfare system amount to a nearly £10bn annual cost to the taxpayer.