The Department for Work and Pensions (DWP) is set to implement new measures to combat benefit fraud by requesting data from pensioner bank accounts. The upcoming Public Authorities (Fraud, Error and Recovery) Bill will grant the Government the authority to recover funds directly from the bank accounts of individuals involved in benefit fraud.

Under the new legislation, banks will be mandated to report any suspicious transactions, and the DWP will have the ability to ask for bank statements of individuals under investigation, although direct access to bank accounts will not be permitted. The Bill, currently under review in the House of Lords and anticipated to be effective from April 2026, will encompass individuals claiming Pension Credit.

Recent statistics revealed that in February 2025, approximately 1.36 million pensioners were receiving Pension Credit, with overpayments reaching £610 million in April 2025, a significant portion attributed to fraudulent activities.

This crackdown is part of the government’s broader strategy to save £9.6 billion over the next five years, following an estimated loss of £7.4 billion to benefit fraud in the previous year. The DWP stresses that decisions impacting benefit entitlement due to fraud or errors will always involve human intervention, emphasizing fairness and proportionality. The new measures aim to save £1.5 billion within five years and contribute to overall savings of £9.6 billion by 2030, as estimated by the Office for Budget Responsibility (OBR).

Additionally, the Bill will empower DWP crime investigators to seek search warrants for seizing evidence such as computers and smartphones from fraudsters. Furthermore, the time limit for civil claims related to Covid fraud will be extended from six to twelve years. The DWP’s scope covers nearly 24 million benefit recipients.

DWP Minister Liz Kendall expressed concerns in March about the performance of the existing social security system, highlighting challenges faced by various demographic groups, including high numbers of individuals claiming disability benefits and youth unemployment. The system is under scrutiny for failing to adequately support those in need, with projections indicating a substantial increase in claims for Personal Independence Payments in the coming years, especially among young people and individuals with mental health conditions.