The Department for Work and Pensions (DWP) is set to implement new measures to combat benefit fraud by accessing pensioner bank account data. The Public Authorities (Fraud, Error and Recovery) Bill will empower the government to reclaim funds directly from accounts of individuals involved in benefit fraud. Banks will be mandated to report any suspicious transactions, and the DWP will have the authority to request bank statements during investigations, without direct access to the accounts.
Expected to be enforced from April 2026, the bill will cover individuals claiming Pension Credit. Statistics indicate that 1.36 million pensioners were receiving Pension Credit as of February 2025, with overpayments reaching £610 million in April 2025, of which £270 million was attributed to fraudulent activities.
This initiative is part of the government’s broader strategy to save £9.6 billion over the next five years, targeting the estimated £7.4 billion lost to benefit fraud annually. The DWP emphasizes the importance of fairness and proportionality in benefit entitlement decisions, with the new bill projected to save £1.5 billion by 2030, according to OBR estimates.
Additional provisions in the bill include granting DWP crime investigators the ability to seek search warrants for seizing evidence from fraudsters, and extending the time limit for civil claims related to Covid fraud to twelve years from six. The DWP, responsible for providing benefits to nearly 24 million people, aims to strengthen measures to combat fraudulent activities and ensure the integrity of the social security system.
DWP minister Liz Kendall highlighted the need for reforms, citing concerning statistics such as the increasing number of individuals claiming sickness or disability benefits and the challenges faced by young people in education and employment. The bill reflects a comprehensive approach to address benefit fraud and enhance the efficiency of the social security system.