DWP TO IMPLEMENT STRINGENT MEASURES TO CRACK DOWN ON BENEFIT FRAUD - 💷

Report by Duncan Williams for Pulman's Weekly News

The UK Government is preparing to roll out a major crackdown on benefit fraud, with new measures set to be introduced by the Department for Work and Pensions (DWP) from 2026.

The initiative, part of the Public Authorities (Fraud, Error and Recovery) Bill, is aimed at reducing fraudulent claims and ensuring taxpayer money is used appropriately. The government estimates that the reforms could save up to £1.5 billion over the next five years.

Among the new measures is the Eligibility Verification Measure, which will allow banks and other financial institutions to flag potential breaches of benefit eligibility rules. This will primarily focus on identifying cases where claimants exceed financial thresholds, such as the £16,000 savings limit for Universal Credit.

However, the DWP has been clear that this does not mean it will have direct access to people’s bank accounts or visibility of how claimants spend their money.

The legislation only permits banks to share limited data, and any unauthorised sharing of information, such as transaction details, could result in penalties for the institutions involved. The government guidance states: “Any information shared through the Eligibility Verification Measure will not be shared on the presumption or suspicion that anyone is guilty of any offence.”

The crackdown also introduces harsher penalties for those found guilty of benefit fraud. Repeat offenders who fail to repay fraudulently obtained funds could face driving bans of up to two years.

The DWP will also be given new powers to recover debts from individuals who are no longer on benefits and not in PAYE employment, preventing people from avoiding repayment when they have the means to do so.

These measures are part of a broader effort to tackle fraud across the public sector and ensure that government funds are directed towards those who genuinely need support.

To ensure fairness and accountability, the DWP has confirmed that all measures will be introduced with strict safeguards.

Oversight mechanisms will be put in place, and the government has committed to a “test and learn” approach before full implementation.

A series of 11 factsheets published by the DWP outlines how these new powers will be monitored and regulated, with the government stating: “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.”

In addition to financial checks, the DWP will expand its ability to gather information from third-party organisations, including airlines, to verify whether benefit claimants are living abroad while continuing to receive payments. This is intended to clamp down on individuals who may be fraudulently claiming UK benefits while residing in another country.

The government is also strengthening its approach to organised benefit fraud by introducing new powers of entry, search and seizure to target criminal gangs. This will reduce reliance on the police in complex fraud investigations and allow the Public Sector Fraud Authority to take a more active role in tackling large-scale fraud cases.

Other measures in the Bill include stronger civil penalties for fraudsters as an alternative to criminal prosecution and improved processes for recovering public money lost through fraudulent claims.

While the reforms are designed to crack down on fraud, the DWP has reassured legitimate claimants that they will not be unfairly targeted.

The focus is on preventing incorrect payments and identifying deliberate fraud rather than penalising those who are entitled to financial support.

The government has stressed that the new powers will be used “appropriately, proportionately, and effectively”, with trained staff ensuring that investigations are carried out fairly.

With implementation set to begin in 2026, the coming months will see further discussions with stakeholders, industry experts, and regulators to finalise the details of how these measures will operate.

The government's intention is to remain committed to ensuring that taxpayer money is spent wisely, balancing the need for fraud prevention with the protection of those who rely on the welfare system.