New government measures will allow Department for Work and Pensions (DWP) officials to access bank account details of benefit claimants who owe money. The new legislation gives investigators the authority to request bank statements and even withdraw money directly from accounts to cover debts.
However, fraud prevention experts warn that these powers could lead to privacy risks and potential errors, affecting people unfairly.
What Are the New DWP Bank Account Access Powers?
Under the proposed new legislation, the DWP will have the authority to:
- Request at least three months’ worth of bank statements from financial institutions.
- Identify all bank accounts a person holds with a bank, including joint accounts.
- Access details such as account type, account holder’s name, and address.
- Deduct money directly from a claimant’s account if they owe debt to the DWP.
These measures are designed to help recover unpaid debts, including overpaid benefits and fraudulent claims.
Privacy Concerns and Risks of “Collateral Intrusion”
Experts warn that these new powers could lead to unintended privacy violations.
- Helena Wood, director at fraud prevention group Cifas, expressed concerns about “collateral intrusion”, where innocent individuals’ private information could be accessed by mistake.
- She pointed out that data from banks and the DWP is not always accurate, raising the risk of errors.
- She urged that there should be strict data-matching standards to avoid wrongful deductions or investigations.
Ms. Wood stated:
“This is a very intrusive power… We need to ensure that matches are accurate and that individuals are not wrongly affected.”
She called for clear guidelines on what specific data the DWP can access and how privacy risks will be minimized.
How Could This Affect Benefit Claimants?
If these powers come into effect, benefit claimants could face:
- More government scrutiny over their personal finances.
- Unintentional deductions from their bank accounts if there are errors in the system.
- Increased difficulties for people with joint accounts, as partners’ financial information may also be accessed.
- Greater risk of financial hardship for those struggling with debt.
These concerns have led campaigners to demand better safeguards to prevent wrongful deductions and ensure claimants’ rights are protected.
How Will Other Government Agencies Use These Powers?
The DWP is not the only department set to use these new measures.
- NHS counter-fraud teams plan to track and recover fraudulent healthcare payments.
- Alex Rothwell, head of the NHS Counter Fraud Authority, supports the bill, stating it will help recover funds from people suspected of fraud.
- He noted that the powers would be useful in small-scale fraud cases involving £5,000–£10,000.
However, privacy advocates argue that these measures must be applied carefully to avoid wrongful accusations and unintended harm.
What Happens Next?
The bill is still under review, and experts are calling for greater transparency before it becomes law.
- Fraud prevention groups are pushing for clear rules on how bank data will be matched to DWP records.
- MPs are being urged to examine the risks before approving the legislation.
- Campaigners want stronger protections to prevent errors and wrongful deductions.
As discussions continue, claimants should stay informed about how these changes could affect their rights and finances.
The DWP’s new bank access powers aim to clamp down on benefit fraud and recover unpaid debts, but they also raise serious privacy concerns. Experts warn that inaccurate data matching could lead to wrongful deductions and unintended financial hardship.
With concerns over how personal banking data will be handled, campaigners are calling for stronger safeguards to protect claimants from errors and misuse. As the bill progresses through Parliament, the government faces growing pressure to balance fraud prevention with individual privacy rights.
FAQ’s
What new powers will the DWP have over bank accounts?
The DWP will be able to request bank statements, identify all accounts a claimant holds, and deduct money directly from their account if they owe debt.
Why are experts concerned about the DWP’s new bank access powers?
Experts warn of ‘collateral intrusion,’ where innocent individuals’ private information may be accessed due to inaccurate data matching.
Will joint bank accounts be affected by the new DWP measures?
Yes, the DWP will be able to see details of joint accounts, including both account holders’ names and addresses.
How will NHS fraud investigators use these powers?
The NHS Counter Fraud Authority plans to use these measures to track and recover fraudulent healthcare payments.
When will the new DWP bank account rules come into effect?
The bill is still under review, and MPs are considering the privacy risks before it becomes law.
