Leading MPs are demanding closer oversight of how the DWP uses the new powers
Leading MPs are demanding closer oversight of how the DWP uses the new powers
A parliamentary committee has urged for additional protections regarding ‘draconian’ anti-fraud powers recently handed to the Department for Work and Pensions (DWP). The new legislation, aimed at curbing fraud and incorrect payments, grants extensive new measures to officials, including eligibility checks to verify the bank account details of certain benefit claimants.
Initially, these checks will scrutinise the account information of those receiving Universal Credit, Pension Credit and Employment and Support Allowance, ensuring they qualify for their payments. This procedure could potentially be extended to other benefits.
The newly approved laws also permit investigators to directly deduct an amount from a person’s bank account in instances where they owe money to the DWP and are refusing to repay the debt. These powers will target people who have outstanding debts and have exited the benefits system.
Draconian new powers
While the legislation does provide for an independent overseer to supervise the use of these powers, the Public Accounts Committee is now calling for further safeguards. Committee chair, Geoffrey Clinton-Brown, said: “Being able to take money out of people’s bank accounts without a court order, compelling banks and other financial institutions to give information, are significant extra powers that the DWP have got.
“We are concerned particularly in light of the Carer’s Allowance issue, where 26,000 people were sent demands for overpayment of the allowance, when they hadn’t been able to report it properly, and they are going to be refunded. That gives an example of where the DWP could get things wrong, with these quite draconian new powers.”
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The committee monitors how public money is used across Government projects, ensuring departments use funds prudently and efficiently. They are requesting that the DWP submit yearly reports detailing how the anti-fraud measures are being used.
Mr Clinton-Brown said: “We have made a recommendation that the DWP have to report to us once a year, a full report on where and how they have used these powers. If we get the slightest impression that they are being used unreasonably, we will start to have an investigation and call them in and ask them to account for themselves.”
Defrauding the taxpayer
He outlined a scenario where the committee would seek further details from the DWP: “Suppose they started to go after people on Universal Credit for a particular aspect. We would want to be assured that the use of that power was reasonable in those cases.”
Despite the concerns, the committee chair acknowledged that the new authority to withdraw funds directly from bank accounts may be justified in certain circumstances. He said such measures may be needed where a person persists in “committing what is a serious effort to defraud the taxpayer”.
Mr Clinton-Brown said: “This is taxpayers’ money. If it’s being overpaid in one area, it’s then putting pressure on the funds available if the Government wanted to increase benefits in another area. I think it is incumbent on the DWP to try and get these things right.”
However, he said he understands that benefit recipients may feel uneasy about DWP officials being granted such enhanced powers. The Conservative MP said: “I have a lot of sympathy with people over these powers, they will be worried.
“That’s why I think it’s incumbent on the DWP to make it absolutely clear in their communications, by better communications, that it’s only going to be used in the most extreme cases where people have been warned, hopefully several times, before these powers are used.”
The legislation stipulates that should the DWP wish to implement a direct deduction from a bank account, they must obtain a minimum of three months’ worth of bank statements for the relevant account, to ensure the person has sufficient funds available.
The DWP is also required to inform the person of their intention to recover the sum, providing at least 28 days’ notice for them to challenge the decision. Mr Clinton-Brown was questioned about what further measures might be introduced to combat fraud and error within the benefits system.
More changes to prevent fraud
He said that advancements in technology, such as AI, and improved data sharing between Government departments could aid in this endeavour. He said: “They [the DWP] do a very good job of linking in with HMRC on things like PAYE, but there are other areas.
“You could imagine, for example, local authorities, the Department for Education, where they could get information. They themselves admit that they could do more to try and reduce the rate of fraud and error.”
When the laws were added to the books, DWP minister Andrew Western 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.”
