A DWP crackdown will target ‘big businesses and Covid fraudsters’. Officials will start to carry out bank account checks as the government acknowledged there is a ‘major problem’ with people trying to cheat the system.
Andrew Western, Labour Party Minister for Transformation, has stated that the DWP’s crackdown will focus on ‘big businesses, Covid fraudsters, organised criminal gangs seeking to defraud the system, [and] individuals who are knowingly cheating their benefits’. He declared: “It is not acceptable, we have a major problem and we are taking the powers needed to act.”
Mr Western further explained that the Fraud, Error and Recovery Bill’s measures are crucial in helping the Government address these unacceptable losses. For the financial year 2023/24, the DWP estimates that benefit overpayments amounted to £9.7 billion, equating to 3.7% of all benefit expenditure.
Overpayment rates are notably higher for means-tested benefits such as Universal Credit. An estimated £6.5 billion, or 12.4% of total Universal Credit expenditure, was overpaid due to fraud or error in 2023/24.
Furthermore, it was estimated that 10.9% was overpaid solely due to fraudulent activities. Although the level of fraud and error in 2023/24 was lower compared to the previous two years, it remains higher than pre-Covid-19 pandemic levels, reports Stoke on Trent Live.
The DWP previously announced that the new Bill “introduces measures to be tough on criminals and fairer to taxpayers”.
Work and Pensions Secretary Liz Kendall said: “We are turning off the tap to criminals who cheat the system and steal law-abiding taxpayers’ money. This means greater consequences for fraudsters who cheat and evade the system, including as a last resort in the most serious cases removing their driving licence.
“Backed up by new and important safeguards including reporting mechanisms and independent oversight to ensure the powers are used proportionately and safely. People need to have confidence the Government is opening all available doors to tackle fraud and eliminate waste, as we continue the most ambitious programme for government in a generation with a laser-like focus on outcomes which will make the biggest difference to their lives as part of our Plan for Change.”