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The UK Government has heralded ‘the biggest fraud crackdown in a generation’ to curb losses in the welfare system, with the Department for Work and Pensions (DWP) projecting that the Public Authorities (Fraud, Error and Recovery) Bill will recoup £1.5 billion for the taxpayer over five years.
New deterrents include potential driving bans of up to two years for persistent benefit fraudsters who don’t repay their debts, the DWP’s authority to seize funds directly from offenders’ bank accounts, and Eligibility Verification, enabling entities like banks to report suspected fraudulent benefit claims.
The DWP has released 11 detailed factsheets providing further clarity on how these new measures will be safely implemented and regulated, confirming that the UK Government plans to roll out the proposed actions starting from 2026.
These documents also detail the safeguards, reporting systems, and oversight intended to ensure the “appropriate, proportionate, and effective use of the powers”.
Official guidance on GOV.UK notes: “The Government will begin implementing the Bill measures from 2026. For the Eligibility Verification Measure, the Government will implement a ‘test and learn’ approach to ensure the new powers to tackle public sector fraud are being used proportionally and effectively.”, reports the Daily Record.
“DWP and the Cabinet Office will continue to work with industry to implement the new measures, consult stakeholders on Codes of Practice and publish guidance.”
The DWP is set to enhance its information-gathering capabilities by collaborating with additional third-party entities, including airlines, to verify if individuals are claiming benefits from abroad, potentially breaching eligibility requirements.
It’s crucial to note that the DWP won’t have unfettered access to the bank accounts of millions receiving means-tested benefits like Universal Credit, Pension Credit, and Employment and Support Allowance.
In a bid to clamp down on benefit fraud, the DWP will liaise with banks to pinpoint claimants who may not meet the means-tested benefits criteria, such as the £16,000 income cap for Universal Credit, and use this data to investigate and prevent overpayments or fraudulent claims.
The legislation strictly limits the scope of data sharing to essential information only, prohibiting banks from divulging transaction details, thereby ensuring the DWP cannot monitor how benefit recipients spend their funds.
Moreover, the factsheet highlights that financial institutions could face penalties for disclosing excessive information, including transaction details.
It further clarifies: “Any information shared through the Eligibility Verification Measure will not be shared on the presumption or suspicion that anyone is guilty of any offence.”
