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The Department for Work and Pensions (DWP) could potentially go after the wrong people with its new powers to directly take funds from benefit claimants' bank accounts. The forthcoming legislation will enable officials to directly deduct amounts from a person's bank account if they owe money to the DWP and refuse to repay it. These deductions can be made either as a lump sum or in regular instalments. Prior to any deduction, investigators will inform the person and request at least three months of bank statements for the account, to ensure they have the funds available. Martin Hartley, group CCO of business consultancy emagine and member of the Bank of England decision maker panel, emphasised the need for thorough checks so people are not wrongly targeted. He said: "Without careful oversight, there is a danger that individuals could be wrongly identified as having received overpayments, or that funds could be incorrectly deducted from bank accounts. "To prevent these risks, verification processes must be robust. Ensuring proper checks and balances is critical not only to protect claimants from undue financial harm but also to maintain public confidence in the integrity of the benefits system." The bill is currently under review by the House of Lords. The legislation also proposes bank account checks for people on certain benefits. The powers will initially apply to those receiving Universal Credit, Employment and Support Allowance and Pension Credit, to make sure claimants meet the eligibility criteria for their payments. An independent overseer will be appointed to monitor how the powers are used. This person will evaluate whether the measures are being used appropriately and how effective they are in preventing erroneous payments and recovering debts. Mr Hartley explained the common causes behind benefit payment mistakes. He said: "Errors in overpayments or underpayments often stem from a combination of factors. "This includes outdated or incomplete claimant information and delays in reporting changes. The combination of data sharing limitations and poor quality data creates inaccuracies as without clean data, systems can't perform effectively." He suggested that there should be further verification checks to help tackle this problem. The specialist said: "To address these issues, there should be greater automation and real-time data verification between departments and financial institutions, supported by modern digital infrastructure. "Simplifying the benefits system and providing clearer guidance for claimants would also reduce the likelihood of mistakes. Investing in staff training and ensuring claimants know they can easily update their information would go a long way towards improving accuracy and fairness across the system. " A policy document from the DWP introducing the new legislation said: "The bill will modernise DWP's powers to ensure money spent is reaching those who need it, and not those who exploit the system. "This will result in more money being recovered, more robust action being taken against those who attack the system, and an increased deterrent to potential fraudsters. The powers contained in this bill to address overpayments in the social security system will be tough on criminals and fair for the taxpayer - and DWP claimants - that money in the public sector is spent wisely and effectively."
