DWP could soon be allowed to look through your bank account

Almost 9 million claimant bank accounts to be put under continuous surveillance
PUBLISHED: 30 NOVEMBER 2023
The DWP is to begin continuous surveillance of the bank accounts of all pension credit, universal credit and employment and support allowance claimants using powers under a bill currently going through Parliament. The department have said that they intend to use their new power to force any third party to pass on data to them more widely in the future.

The power to compel third parties into providing any data that the DWP wants in order to search for fraud and error is being conferred in last minute amendments slipped into the Data Protection and Digital Information Bill, which has now passed its third reading in the Commons and moved to the Lords.

Initially the DWP say that they will use their powers to oblige the UK’s top 15 banks to monitor the accounts of all means-tested benefits claimants and report every time an account goes over the capital limit or is used abroad for more than four weeks.

Because every DWP payment into a bank account has an identifying code attached to it, all banks know exactly which of their customers is on benefits and which benefits they receive.

Setting up software to automatically send details to the DWP of every claimant account that goes over the capital limit or is used abroad for more than four weeks will be very straightforward for banks.

The DWP say that each identified claim will be investigated in the normal way and that penalties will not be automatically imposed.

At the moment, almost 9 million claimants would be caught in the surveillance net, including:

5.8 million universal credit claimants
1.6 million employment and support allowance claimants
1.4 million pension credit claimants
Any bank failing to collect and pass on data to the DWP will be subject to heavy fines.

The new system will begin to be rolled out in 2025, though all banks may not be fully involved before 2030.

The DWP estimates that it will cost around £30 million a year for them to investigate potential fraud identified by the new system, but that they will save £500 million a year through reduced fraud and error.

They also estimate that over the first ten years, the new powers will result in 74,000 prosecution cases and 2,500 custodial sentences.

There is no doubt that the DWP intend to use these new powers much more widely. The impact assessment for the new powers says that:

“The power is not limited to a specific type of data or type of institution/Third-Party to allow us to fight new fraud and error issues as they emerge and engage with new institutions as efficient opportunities become available to us.”

Later, the same document says:

“This measure is drafted broadly . . . to enable DWP to apply this measure to non-financial organisations in future if it is deemed appropriate and proportionate”

The new surveillance powers for the DWP appear to enjoy cross party support. Only 51 MPs voted against the amendment, with 30 of those being SNP and just 7 each from Labour and the Lib Dems.

Anyone who imagines that the DWP will use such sweeping powers reasonably and proportionately probably hasn’t ever claimed benefits.

And they probably also don’t remember the Regulation of Investigatory Powers Act, which was brought in to combat terrorism and organised crime and ended up being used to spy on dog walkers, pigeon feeders and people putting out their wheelie bins too early.

Capital and abroad fraud account for less than 15% of benefits fraud and error. The DWP will want to delve into many other aspects of claimants lives in order to identify the other 85%. This is, beyond doubt, the thin end of a very thick wedge.