Latest news with #Horizon-style
Yahoo
30-04-2025
- Politics
- Yahoo
10,000 ‘innocent' benefits claimants could have bank accounts wrongly checked by DWP, MP warns
Thousands of people could be wrongly implicated for benefit fraud offences under government reforms that will see the Department for Work and Pensions (DWP) recover money directly from claimants' bank accounts, an MP has warned. Former Tory minister David Davis is among a number of MPs to raise concerns about the scope and accuracy of the technology used to enforce the government's Fraud, Error and Recovery Bill, which will give the government the power to investigate benefit claimants' bank accounts by legally compelling banks to share account data, and take overdue payments. The government and banks will use an algorithm to detect potential fraudsters, as well as to recover money directly from the bank accounts of people accused of committing benefit fraud. In serious cases, the government will suspend people's driving licences. But with an algorithm error margin of just 1%, at least 10,000 innocent people will be "dragged through the system", Davis warned. "If the banks use algorithms, they will have an error rate of at least 1%. That means 10,000 or more innocent people will be dragged through the system by this proposal," Davis said. The bank account spying powers in today's Public Authorities (Fraud, Error and Recovery) Bill amount to a suspicionless surveillance tool impacting over 9 million innocent people's bank Government must think again.I made this point today in the @HouseofCommons 👇🏻 — David Davis MP (@DavidDavisMP) April 29, 2025 He added: "Big Brother Watch, Age UK and a multitude of other charities have highlighted concerns about the bill, such as the breakdown in trust that it could cause and the risk of amplifying the challenges faced by people with disabilities." Big Brother Watch told Yahoo News that "recruiting banks to investigate benefits recipients on behalf of the state for administrative error is an intrusive overreach." Jasleen Chaggar, legal and policy officer at Big Brother Watch, said: "This law undermines the presumption of innocence and treats people as suspects by default." "The use of algorithmic software to snoop on everyone's bank accounts will inevitably lead to devastating errors which will disproportionately impact elderly people, disabled people, carers, single parents and the poorest in our society." "Despite 25 civil society groups and 237,775 members of the public calling on parliament to drop the mass bank spying powers, the government is still pushing ahead. It will now be up to the House of Lords to challenge the harmful and rights-eroding provisions in this bill." Labour MP Neil Duncan-Jordan warned that a misuse of the technology could lead to another "Horizon-type scandal", referring to the error-ridden technology that saw hundreds of Post Office staff wrongly accused and convicted of fraud and false accounting. Responding to Davis's remarks, Duncan-Jordan said: "The right honourable member brings me to my next point, which is the risk of a Horizon-style scandal on a massive scale, given the sheer volume of accounts that will be scanned. "That is glaringly obvious." The Labour MP for Poole proposed limiting the powers of the bill to when a welfare recipient is suspected of wrongdoing and not of error, adding that the benefits system "lends itself to errors" as it is "extremely difficult to navigate". "Analysis of the bill has shown that where assessment deems that a financial deduction would cause hardship, the debtor can face losing their licence. That is not justice in my view, but a penalty for being poor," Duncan-Jones said. "Our welfare state needs to provide support for those who need it, and the change that we promised as a government must lead to a more compassionate and caring society – one that enables rather than penalises. "These are the values that make us different from the last government, and we should not forget that." Fellow Labour MP and former shadow chancellor John McDonnell added: "Time and again, when we have introduced legislation like this in the past that has short-circuited the traditional protective constitutional and legal mechanisms, it has led to debacles and miscarriages. "I warn ministers that that is exactly what we are facing here. Reference has been made to issues with regard to the use of computers, models and algorithms. We seem to have learned nothing from where we have made those errors." Work and pensions spokesperson for the Liberal Democrats, Steve Darling, branded the legislation "Orwellian", and said that the government needs to publish a best-practice document to give claimants' peace of mind. The government said the bill, which has now progressed to the House of Lords, could recover £1.5bn over the next five years by "targeting the bank accounts of fraudsters who can repay but are wilfully gaming the system". It will also appoint an annual reviewer to look at the bill. However, Darling said that as the government is allowed to appoint its own reviewer, it defeats the object of the inspection. "We do not welcome the secretary of state effectively marking their own homework by making the appointment themselves," he added. The government has been approached for comment.
Business Mayor
25-04-2025
- Business
- Business Mayor
Starmer faces Labour revolt over plan to raid bank accounts of benefit claimants
Keir Starmer is facing a rebellion over his plan to use direct deductions from people's bank accounts and the cancellation of driving licences as part of a government crackdown on welfare fraud and over-claiming. In an attempt to claw back the annual £9.7bn in benefit overpayments made by the Department for Work and Pensions due to fraud or error, the government has adopted Conservative plans for debt recovery. A fraud, error and recovery bill would give the DWP the power to require banks to provide data to help identify when an applicant is not meeting the eligibility criteria for a benefit for which they have applied. The bill would allow the government to demand bank statements to identify debtors who have sufficient funds to repay what they owe through fraud or error in a claim. The DWP would then have the power to recover money directly from bank accounts of those not on benefits or in PAYE employment who are identified as having the means to pay. Those who repeatedly fail to repay funds could fall prey to a suspended DWP disqualification order that would disqualify them from holding a driving licence. Liz Kendall, the secretary of state for work and pensions, has said the powers are necessary to deal with a 'broken welfare system' but she is facing opposition from her own backbenches. Amendments tabled by the Labour MP for Poole, Neil Duncan-Jordan, that would force the government to drop key strands of the bill are supported by a growing number of MPs in Starmer's party. The amendments, backed by 17 named Labour MPs, would ensure that only those suspected of fraud rather than being the victim of an error were subjected to surveillance, 'allowing the government to target criminality without monitoring the public', Duncan-Jordan said. The Labour MP is also proposing to remove the power to apply to a court to strip people of their driving licences due to debt, describing the policy as a 'poverty penalty'. Writing in the Guardian, Duncan-Jordan, who was elected for the first time in 2024, accused Starmer's government of 'resurrecting Tory proposals for mass spying on people who receive state support'. He writes that the legislation 'would compel banks to carry out financial surveillance of welfare recipients', adding that 'given the volume of accounts involved, this will be completed by an algorithm'. 'If the software flags a possible overpayment, whether due to fraud or error, the bank will report the individual to the Department for Work and Pensions for further investigation,' Duncan-Jordan writes. 'By default, welfare recipients would be treated as suspects, simply because they need support from the state.' He adds that the government should learn from the Post Office scandal in which a faulty computer system led to hundreds of people being falsely accused of fraud and error. He writes: 'The risk of a Horizon-style scandal on a massive scale is glaringly obvious when millions are being monitored. It will be disabled people, carers, pensioners and the very poorest people who are impacted by wrongful investigations and forced to endure burdensome appeals to prove their innocence.' skip past newsletter promotion Our morning email breaks down the key stories of the day, telling you what's happening and why it matters Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion Kendall has said the use of 'direct deduction orders' allowing the recovery of funds from claimants could save the taxpayer £500m a year once fully rolled out. In the 2023-24 financial year, the DWP estimates that benefit overpayments due to fraud or error by claimants totalled £9.7bn. But the banking industry has raised concerns that it will be forced to hand over account information of claimants in cases where there are indications they may have been paid benefits incorrectly. The legislation is seen to potentially clash with the obligations of banks under a Financial Conduct Authority consumer duty to protect customers who are vulnerable due to their financial situation. Last week, the Guardian revealed that the regulatory policy committee, a government watchdog, had raised concerns that ministers had understated the impact on the poorest of its plans to directly deduct benefit overpayments from people's bank accounts. A DWP spokesperson said: 'We have an obligation to protect public funds, and it is right that we modernise our approach to catching fraudsters and overpayments. All the powers in the bill are underpinned by a principle of fairness and proportionality and do not involve mass surveillance of people's bank accounts. 'This includes utilising limited data from banks to help verify entitlement to benefits, helping us detect errors earlier and minimise debts accruing for claimants.'
The Guardian
25-04-2025
- Business
- The Guardian
Starmer faces Labour revolt over plan to raid bank accounts of benefit claimants
Keir Starmer is facing a rebellion over his plan to use direct deductions from people's bank accounts and the cancellation of driving licences as part of a government crackdown on welfare fraud and over-claiming. In an attempt to claw back the annual £9.7bn in benefit overpayments made by the Department for Work and Pensions due to fraud or error, the government has adopted Conservative plans for debt recovery. A fraud, error and recovery bill would give the DWP the power to require banks to provide data to help identify when an applicant is not meeting the eligibility criteria for a benefit for which they have applied. The bill would allow the government to demand bank statements to identify debtors who have sufficient funds to repay what they owe through fraud or error in a claim. The DWP would then have the power to recover money directly from bank accounts of those not on benefits or in PAYE employment who are identified as having the means to pay. Those who repeatedly fail to repay funds could fall prey to a suspended DWP disqualification order that would disqualify them from holding a driving licence. Liz Kendall, the secretary of state for work and pensions, has said the powers are necessary to deal with a 'broken welfare system' but she is facing opposition from her own backbenches. Amendments tabled by the Labour MP for Poole, Neil Duncan-Jordan, that would force the government to drop key strands of the bill are supported by a growing number of MPs in Starmer's party. The amendments, backed by 17 named Labour MPs, would ensure that only those suspected of fraud rather than being the victim of an error were subjected to surveillance, 'allowing the government to target criminality without monitoring the public', Duncan-Jordan said. The Labour MP is also proposing to remove the power to apply to a court to strip people of their driving licences due to debt, describing the policy as a 'poverty penalty'. Writing in the Guardian, Duncan-Jordan, who was elected for the first time in 2024, accused Starmer's government of 'resurrecting Tory proposals for mass spying on people who receive state support'. He writes that the legislation 'would compel banks to carry out financial surveillance of welfare recipients', adding that 'given the volume of accounts involved, this will be completed by an algorithm'. 'If the software flags a possible overpayment, whether due to fraud or error, the bank will report the individual to the Department for Work and Pensions for further investigation', Duncan-Jordan writes. 'By default, welfare recipients would be treated as suspects, simply because they need support from the state.' He adds that the government should learn from the Post Office scandal in which a faulty computer system led to hundreds of people being falsely accused of fraud and error. He writes: 'The risk of a Horizon-style scandal on a massive scale is glaringly obvious when millions are being monitored. It will be disabled people, carers, pensioners and the very poorest people who are impacted by wrongful investigations and forced to endure burdensome appeals to prove their innocence.' Sign up to First Edition Our morning email breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion Kendall has said the use of 'direct deduction orders' allowing the recovery of funds from claimants could save the taxpayer £500m a year once fully rolled out. In the 2023-24 financial year, the DWP estimates that benefit overpayments due to fraud or error by claimants totalled £9.7bn. But the banking industry has raised concerns that it will be forced to hand over account information of claimants in cases where there are indications they may have been paid benefits incorrectly. The legislation is seen to potentially clash with the obligations of banks under a Financial Conduct Authority consumer duty to protect customers who are vulnerable due to their financial situation. Last week, the Guardian revealed that the regulatory policy committee, a government watchdog, had raised concerns that ministers had understated the impact on the poorest of its plans to directly deduct benefit overpayments from people's bank accounts. The DWP has been contacted for comment.
The Guardian
25-04-2025
- Politics
- The Guardian
Should benefit claimants risk having their bank accounts spied upon and driving licences revoked? I don't think so
Labour won last year's general election on a promise to reverse the damage done by the previous Conservative governments, offering a politics that would, in the memorable words of the prime minister, 'tread more lightly on our lives'. I won a historic victory in Poole for Labour last July on the basis that things would change – and change for the better. But my constituents, already fearful of plans for the largest cuts to disability support in a generation, have been getting in touch with me about new legislation that might be news to you: the government is resurrecting Tory proposals for mass spying on people who receive state support. The powers contained in the public authorities (fraud, error and recovery) bill quite rightly seek to tackle organised crime and online fraud, but they also usher in new powers for the banks to trawl through bank details of individuals – even where there is no suspicion of wrongdoing. This legislation would compel banks to carry out financial surveillance of welfare recipients. Given the volume of accounts involved, this will be completed by an algorithm. If the software flags a possible overpayment, whether due to fraud or error, the bank will report the individual to the Department for Work and Pensions (DWP) for further investigation. Why should someone in receipt of benefits have fewer rights to privacy? And why are we asking banks to become an arm of the state? These new powers strip those who receive state support of a fundamental principle of British law: the presumption of innocence. By default, welfare recipients would be treated as suspects, simply because they need support from the state. The risk of a Horizon-style scandal on a massive scale is glaringly obvious when millions are being monitored. It will be disabled people, carers, pensioners and the very poorest people who are impacted by wrongful investigations and forced to endure burdensome appeals to prove their innocence. It has been suggested that the powers would help identify overpayments more quickly, but the DWP already has ample data-sharing and data-matching powers at its disposal. The carer's allowance scandal, when unpaid carers were plunged into debt and prosecuted for fraud because of the DWP's own overpayments, provides an example of where the department was failing to use the access to real-time alerts of carers' earnings they already had to stop overpayments. The government admits that if fraudsters spread assets across multiple accounts, they won't be flagged. The bill also grants the DWP draconian powers to apply to a court to have people stripped of their driving licences if they have outstanding debt, where all other attempts at recovery have failed. The government claims this will be a last resort where the debtor fails to engage with the DWP. In practice, it means officials will first attempt to deduct funds directly from their bank account. To do this, they must secretly request at least three months of bank statements from a bank without informing the individual, to assess whether the deduction would cause 'hardship'. If it would, the person would eventually face the threat of losing their licence. That's not justice – it's a poverty penalty. The so-called safeguards for vulnerable debtors are also inadequate, relying heavily on court oversight and the ability of individuals to make personal representations. This overlooks the fact that these powers only apply to those deemed not to have 'engaged' with the DWP – a standard that fails to recognise how non-engagement is often a symptom of genuine hardship and the circumstances in which people find themselves, rather than any wrongdoing. Many benefit recipients live with mental health conditions, disabilities, or have caring responsibilities that make navigating complex bureaucracy extremely difficult. All these challenges will only be made worse if the government proceeds with its planned cuts to disability benefits, which will affect over 3 million families and force many disabled individuals into crisis and destitution. I have proposed amendments to this bill to ensure that only those suspected of fraud are subject to surveillance, allowing the government to target criminality without monitoring the public. I have also proposed removing the power to apply to a court to strip people of their driving licences due to debt. There are fairer and more effective ways to enforce the law. We must prevent the corruption of our welfare state into a punitive system, where the price of accessing support is the sacrifice of privacy and exposure to the uniquely cruel sanction of being stripped of mobility. The welfare state needs to wrap its arms around those who need it. It should be there for everyone, but this approach undermines public trust in the system. The change we promised must mean a more compassionate and caring society, one that enables rather than penalises. These values are what makes us different from the previous government – and we shouldn't forget that. Neil Duncan-Jordan is the Labour MP for Poole
