DWP anti-fraud bank account checks for benefit claimants 'won't fix the bigger issue'

New powers for DWP officials to view benefit claimants' bank account details risk overlooking more important issues. A bill is going through Parliament including measuresto view the bank account details of people on certain benefits, to check they are eligible for their payments. The 'eligibility verification measure' powers will initially be used to check the details of people claiming Universal Credit, Employment and Support Allowance and Pension Credit.

But the draft legislation mentions that this could be expanded to other benefits. Experts at free debt advice group Money Wellness have voiced concerns the new bank checks will not help in dealing with more important issues around why some people are wrongly paid.

External relations manager Rebecca Lamb said: "Bank account checks might help catch a small amount of fraud, but they won't fix the bigger issue - that most problems happen because the system is complicated and easy to get wrong." She said that in her experience, most problems with benefit payments are not related to fraud.

She backed this up citing some DWP figures: "Most problems happen because the system is confusing - even the DWP can make mistakes. And small errors can have a huge impact on households that are already just about covering the bills.

"In fact, the Government's most recent data shows that overpayments due to fraud were 2.2 percent (£6.5 billion) in the year ending 2025. While this is a lot of money, it actually represents only a small fraction of total benefit payments."

A policy paper introducing the bank account checks said they will "help identify where someone may not be meeting the specific eligibility criteria of a benefit" to help the DWP "identify incorrect payments and prevent debts accruing for claimants". The DWP will not have direct access to anyone's bank account, nor any information about how they spend their money.

The Government estimates the bill will deliver total benefits of some £1.5billion over the next five years. Stuart Morris previously worked as a DWP benefits official and is now chief technology and product officer at SmartSearch.

He said that enhanced data sharing measures such as those set out in the bill can make a big difference in helping improve the DWP system. Mr Morris said: "A robust digital identity framework could transform how people access a wide range of public services - from pensions, healthcare and driving licences to tax and education. It could also simplify identity verification in everyday life, such as applying for a mortgage or proving eligibility for student finance.

"The real efficiency comes when a verified credential can be reused securely across services, reducing paperwork and duplication. But any expansion must be guided by strict data-minimisation principles and clear public consent. Convenience must never come at the cost of privacy or inclusion."

He said that the Government could also improves it verification measures bylinking existing data sources, under proper oversight. He explained: "For example, linking real-time HMRC payroll data, immigration records and DWP systems could help identify inconsistencies more effectively - provided it is done transparently and lawfully.

"However, this must not lead to excessive data sharing or automated decision-making without human oversight. Systems should be audited regularly, with clear rights for citizens to challenge or correct errors."

As part of the new legislation, an independent person will be appointed to oversee the use of the eligibility checks. They will assess whether the measures has been effective in identifying incorrect payments, and make sure the powers are used in line with the bill and the code of practice.