The UK Parliament’s Public Accounts Committee (PAC) has raised concerns about new powers the Department for Work and Pensions (DWP) now has. These powers relate to checking people’s bank accounts to help tackle benefit fraud and errors.
Here’s what clients need to know.
1. What Powers Does DWP Now Have?
Since December, the DWP can:
- Ask banks and other financial companies for information about a person’s bank accounts.
- Use this information to check if someone is getting the correct benefits.
- In certain cases, take money back directly from a bank account without going to court (this is only for specific debt situations).
These powers are aimed at reducing benefit fraud and errors.
2. Why Are MPs Concerned?
MPs say the DWP has not fully explained how these powers will be used safely and fairly.
They warn that public trust could be damaged if people feel the DWP might overstep.
The PAC wants the DWP to produce annual reports showing:
- How often these powers are used
- What impact they have
3. What About Honest Claimants?
The PAC stresses that these powers must not be used unfairly.
There are supposed to be “safeguards” in place, though MPs want much clearer information about them.
The focus should be on tackling large‑scale fraud, not on penalising people who make genuine mistakes.
4. Carers Affected by Past Errors
The report highlights that 26,000 carers were wrongly told they had been overpaid Carer’s Allowance due to DWP mistakes.
- DWP has promised to fix this.
- Roughly 200,000 cases need reviewed, which may take about two years.
5. High Levels of Mistakes at DWP
The PAC says benefit fraud and error have been a problem for nearly four decades.
Examples from the latest figures:
- Overpayments: £9.5 billion in 2024–25
- Underpayments: £1.2 billion in 2024–25
- Unreported changes in circumstances led to about £3.7 billion of people missing out on money they should have received
What This Means for Clients
No one’s bank account will be monitored day‑to‑day.
The law doesn’t allow general “snooping.” Banks provide only specific information the DWP asks for.
If your situation is correct and up to date, you should be fine.
These powers target cases where the DWP believes something doesn’t match the benefit rules.
Keep your benefit information updated.
Most problems come from changes in income, savings, or household circumstances not being reported.
If you get a letter asking for information, seek advice.
Advisers like us can check:
- Whether DWP’s request is reasonable
- What evidence is needed
- Whether a decision can be challenged
Reassurance for Clients
- Most people claiming benefits are doing absolutely nothing wrong.
- These powers are mainly aimed at organised fraud.
- The PAC is watching the DWP closely to make sure the powers are used fairly and responsibly.