Social Justice

DWP risks repeat of Post Office scandal with plan to snoop on claimants' bank accounts, MPs warn

The Department for Work and Pensions (DWP) has once again been warned about it's plans to snoop on bank accounts, this time by MPs – including those in the Conservative Party

dwp/ bank accounts spying

The DWP has been accused of attempting to "spy" on benefit claimants. Image: Unsplash

The government risks replicating the “tragic events of the Horizon scandal” with its plans to combat fraud with bank account surveillance, MPs and peers have warned.

The Data Protection and Digital Information Bill is set to compel banks and building societies to give the Department for Work and Pensions (DWP) data to search for fraud and error in the benefits system.

A letter sent to work and pensions secretary Mel Stride and science, innovation and technology secretary Michelle Donelan expressed “deep concern about the powers and their potential impact, particularly in the context of privacy and equality rights“.

Conservative MPs Marcus Fysh and Charles Walker were among those who signed the letter, alongside Liberal Democrat DWP spokesperson Wendy Chamberlain and Green Party welfare spokesperson Catherine Rowett.

It was also signed by Labour MPs Ian Byrne, Richard Burgon, Rebecca Long-Bailey, Zarah Sultana, Debbie Abrahams, Ian Byrne, Kim Johnson, Bell Ribeiro-Addy, Sam Tarry and Mick Whitley – as well as MP Diane Abbott, who has had the Labour whip removed.

The letter said: “While we are sure this is not your intention, the broad and far reaching nature of these powers would be highly intrusive. Issuing an account information notice would require banks to sift through tens of millions of bank accounts in order to identify people in the welfare system, around 40% of the population, in pursuit of indicators of fraud or error.

“Searching for such signals without reasonable grounds for suspicion would reverse the well established presumption of innocence. Indeed, anyone in receipt of welfare payments would automatically be subject to intrusive financial scrutiny solely due to their benefit status. There is a real risk that such efforts to fight fraud will come very much at the expense of the poor, the disabled, and the elderly.”

A number of peers, including Lord Clement-Jones, Baroness Kidron and Baroness Chakrabarti, were also signatories of the letter.

The Data Protection and Digital Information Bill is currently in committee stage in the House of Lords, where it has faced extensive criticism, including in a debate on Monday (22 April).

Speaking at the debate, Baroness Kidron said: “I cannot work out for the life of me if these measures are intended to hurt, or if a focus on the shiny prospect of AI to sort out DWP problems, led incrementally to this place. Whichever, they are cruel to a degree and should worry us all.”

If the bill were to pass in its current state, the DWP will be able to request details around benefit claimants and any connected bank accounts. These could include those of landlords, family members, partners or ex-partners.

Campaign Big Brother Watch, backed by more than 40 charities and organisations including the Big Issue, recently wrote to the work and pensions secretary Mel Stride to warn that the plans risk repeating mistakes made in the Post Office scandal.

More than 165,000 people have signed a Big Brother Watch petition calling for the clauses in the bill to be dropped.

As The Big Issue has reported, legal advice sought by the campaigners found that the plans are likely to have a “disproportionate impact on particular groups, including disabled people, people of colour, women and older people”.

Barristers Dan Squires KC and Aidan Wills of Matrix Chambers also found the exercise of financial surveillance and monitoring powers is “likely to breach Article 8”, the right to live your life privately without government interference.

In response to the legal advice, a spokesperson for the DWP told The Big Issue: “The government remains committed to these powers as a method of reducing fraud and error in the benefits system, which will save the taxpayer £600m over the next five years.

“These measures will require third parties to provide only limited, relevant information that may signal whether benefits are being improperly paid. It does not give DWP access to anyone’s bank account or see how claimants are spending their money.”



The letter from the politicians and peers reiterated arguments made by the lawyers. It said: “In the face of such opacity and absence of any safeguards, it is inevitable that mistakes will be made. Incorrectly flagged accounts could have disastrous consequences from intrusive investigations, to heightened stigma in the welfare system, to the wrongful suspension of benefits. In such cases, vulnerable people could be unable to afford vital necessities such as food, medicine, or heating bills.”

The Big Issue has previously reported on mistakes made within the welfare system, which have left claimants accused of owing thousands of pounds to the DWP. A single mother, for example, was left “devastated” after being falsely accused of owing the DWP more than £12,000 in benefit overpayments.

The letter added: “We note the tragic events of the Horizon scandal in which innocent people suffered wrongful prosecutions, financial ruin, and reputational damage following data used from faulty software in algorithmic systems. We cannot condone powers that risk replicating this disaster on a much broader scale with vulnerable people, many of whom live on the poverty line.”

Sign Big Brother Watch’s petition here.

Do you have a story to tell or opinions to share about this? We want to hear from you. Get in touch and tell us more.

Support the Big Issue

For over 30 years, the Big Issue has been committed to ending poverty in the UK. In 2024, our work is needed more than ever. Find out how you can support the Big Issue today.
Vendor martin Hawes

Recommended for you

View all
Energy bills are set to fall but UK families have already lost £72bn to 'staggering' prices
energy bills
Energy bills

Energy bills are set to fall but UK families have already lost £72bn to 'staggering' prices

Poverty costs the UK billions each year. Politicians must commit to ending it this general election
Trussell Trust food banks
General election 2024

Poverty costs the UK billions each year. Politicians must commit to ending it this general election

Abuse survivor tried to take her own life after years-long battle with DWP over disability benefits
Pound coins on a piece of paper with disability living allowancve
Department for Work and Pensions

Abuse survivor tried to take her own life after years-long battle with DWP over disability benefits

DWP under investigation over treatment of ill and disabled people after deaths of benefit claimants
Department for Work and Pensions

DWP under investigation over treatment of ill and disabled people after deaths of benefit claimants

Most Popular

Read All
Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits
Renters: A mortgage lender's window advertising buy-to-let products
1.

Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal
Pound coins on a piece of paper with disability living allowancve
2.

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal

Cost of living payment 2024: Where to get help now the scheme is over
next dwp cost of living payment 2023
3.

Cost of living payment 2024: Where to get help now the scheme is over

Strike dates 2023: From train drivers to NHS doctors, here are the dates to know
4.

Strike dates 2023: From train drivers to NHS doctors, here are the dates to know