DWP confirms five things checked in bank statements and transactions of people on Universal Credit
DWP also uses transaction details to make an 'accurate assessment' of a claimant's current financial circumstances.
Reasons your Universal Credit may be cut by DWP
The latest figures from the Department for Work and Pensions (DWP) show there are currently 7.5 million people across Great Britain, in or out of work, claiming Universal Credit. The Department recently clarified the need to look at bank statements and transaction details for people making a new claim for Universal Credit or those having their existing award reviewed.
In response to a Freedom of Information (FOI) request, DWP explained how this information helps them 'understand the claimant's earnings, other incomes, savings or housing costs' when processing or renewing a claim.
DWP continued: ' Transaction details, such as descriptions and amounts facilitate an accurate assessment of a claimant's current circumstances.
DWP added: 'For example, it helps us to establish if a claimant has other capital which would allow the Department to determine if the claimant is now in receipt of any other income or has outgoings which could impact the amount of Universal Credit they are entitled to.'
DWP went on to explain that by reviewing transactions on bank statements, it can 'identify unreported changes in circumstances that may affect the amount of Universal Credit received' which includes changes that may lead to extra benefit entitlement.
DWP added: 'One example of this would be evidence of an unreported increase in rent from an outgoing transaction. Where incorrectness is found, claims are corrected retrospectively.'
Eligibility Verification Measure
Earlier this year the UK Government announced 'the biggest fraud crackdown in a generation' to reduce the amount of money being lost in the welfare system. T
he DWP estimates the Public Authorities (Fraud, Error and Recovery) Bill will help save the taxpayer £1.5 billion over the next five years.
New measures include driving bans of up to two years, for benefit cheats who repeatedly fail to pay back money they owe, powers enabling the DWP to recover money directly from fraudsters' bank accounts and Eligibility Verification, which will allow third-party organisations such as banks to flag potential fraudulent benefit claims.
In a series of 11 new factsheets published by the DWP, giving more insight into how the new measures will work safely and be monitored, it confirms the UK Government will begin implementing the proposed measures from 2026.
The factsheets also include information on how safeguards, reporting mechanisms and oversight will work to ensure the 'appropriate, proportionate, and effective use of the powers'.
The guidance on GOV.UK states: '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.
'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 will also be able to gather information from more third-party organisations such as airlines to check if people are claiming benefits from abroad and potentially violating eligibility rules.
Eligibility Verification Measure
It's important to be aware the DWP will not have direct access to the bank accounts of millions of people on means-tested benefits including Universal Credit, Pension Credit and Employment and Support Allowance.
The DWP will work with banks to identify people who may have exceeded the eligibility criteria for means-tested benefits, such as the £16,000 income threshold for Universal Credit - and get that information to then investigate that claimant to prevent possible overpayments and potential cases of fraud.
The legislation only allows banks and other financial institutions to share limited data and excludes the sharing of transaction data, which means DWP will not be able to see how people on benefits spend their money.
In fact, the factsheet explains how banks and other financial institutions could receive a penalty for oversharing information, such as transaction information.
It adds: 'Any information shared through the Eligibility Verification Measure will not be shared on the presumption or suspicion that anyone is guilty of any offence.'
Have your say
What do you think about the new measure? Share your opinion in our poll and the comments below. You can also join in the conversation in our Daily Record Money Saving Scotland Facebook group here.
New DWP measures to tackle fraud
The new Bill will deliver on the UK Government's manifesto commitment to safeguard taxpayers' money - ensuring every pound is spent wisely and effectively:
New powers of search and seizure - so DWP can control investigations into criminal gangs defrauding the taxpayer.
Allowing DWP to recover debts from individuals no longer on benefits and not in PAYE employment who can pay money back but have avoided doing so.
New requirements for banks and building societies to flag where there is an indication there may be a breach of eligibility rules for benefits - preventing debts accruing.
All the powers will include strong safeguards to ensure they are only used appropriately and proportionately - including new inspection and reporting mechanisms.
DWP will have a clearly defined scope and clear limitations for the use of all the powers it is introducing, and staff will be trained to the highest possible standards.
The measures in this Bill will enable the Public Sector Fraud Authority to:
Reduce fraud against the public sector by using its expertise to take action on behalf of other departments, against those who attack the public sector.
Better detect and prevent incorrect payments across the public sector through new information gathering and sharing powers.
Use strong non-criminal sanctions and civil penalties to provide an alternative to criminal prosecution and to deter fraud.
Improve the government's ability to recover public money, through new debt recovery and enforcement powers.
Use new powers of entry, search and seizure to reduce the burdens on the police in the most serious criminal investigations.
Improve fraud management in future emergencies by creating specialist time limited powers to be used in crisis management situations - building on lessons learned during COVID-19.
The Public Sector Fraud Authority will implement a 'test and learn' approach when utilising these powers, piloting different approaches and expertise to find the best way to tackle public sector fraud.
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