The Department for Work and Pensions (DWP) will examine bank accounts as part of the Data Protection and Digital Information Bill that is presently making its way through the Houses of Commons and Lords in order to determine the amount of money that individuals have and how they are using it. Concerns have been voiced regarding the potential extent of this practice, though.
Earlier this month, Mel Stride, Secretary of State for Work and Pensions was questioned by Tory MP Nigel Mills regarding how the powers will be used. According to a report by Wales Online, he was questioned about whether bank accounts of all State Pensioners would be examined.
The DWP has stated that there has been a "great deal of scaremongering" about the new measures, as various sections of the Bill have been questioned and rumours have been spread. It has been verified, meanwhile, that it will only be applied in situations where fraud or error is suspected.
The Mirror reports that the DWP boss stated: "There has been a great deal of scaremongering about what exactly these powers are about. I can make it categorically clear from the Dispatch Box that these powers are there to make sure that, in instances where there is a clear signal of fraud or error, my department is able to take action. In the absence of that, it will not."
Meanwhile, in a House of Lords debate held before Christmas, Lord Bassam of Brighton asked: "As Mel Stride and the DWP officials made clear when giving evidence to the Work and Pensions Select Committee recently, this is not about accessing individual bank accounts directly where fraud is suspected, it is about asking for bulk data from financial organisations. How will the Government be able to guarantee data security with bulk searches […] When were the Government planning to tell the citizens of this country that they were planning to take this new set of powers to look into their accounts? I warn the Minister that I do not think it will go down very well, when the Government fully explains this.”
Lord Bassam further informs that the banking sector was equally concerned about the proposals describing them as overly broad and likely to prejudice disadvantaged consumers. The measure's proportionality is another issue raised by the ICO.
In response for the government, Viscount Camrose said: "Tackling fraud and error in the DWP is a priority for the Government but parliamentary time is tight. In the time available, the DWP has prioritised our key third-party data-gathering measure which will help to tackle one of the largest causes of fraud and error in the welfare system.”
He adds that When parliamentary time permits, they are still committed to introducing all of the measures listed in the DWP's fraud plan. The breadth of the DWP's third-party data collection powers is limited to what is necessary to guarantee its future viability.
This is due to the nature of fraud, which has altered significantly in recent times and continues to do so. The DWP's existing authority is insufficient to combat the new forms of fraud that the assistance system is experiencing.
Viscount Camrose adds that to ensure that benefits like the state pension continue to have low fraud rates, they are including all benefits. Naturally, the DWP will want to concentrate their action on places where fraud or error is a serious problem. The DWP has outlined in its fraud plan how it intends to use the new powers, with fraud in universal credit being the first area of attention.