Labour 'plans to take money from benefit fraudsters' bank accounts' as part of crackdown
The measure is one of several powers to be included in the government’s fraud bill, according to reports.
Welfare fraud investigators will be given the power to take money directly from pay slips and bank accounts as part of plans to crack down on benefit fraudsters, it has been reported.
The measure is one of several far-reaching powers set to be included in the government's forthcoming Fraud, Error and Debt Bill, according to the Sunday Telegraph.
Currently, investigators must secure a court order before deducting money from someone's wages or bank accounts.
The reported measures would go further than those previously announced by the government. As well as the power to deduct money directly from the wages of people who have overclaimed on benefits, the bill is reported to give investigators the ability to compel information about suspected fraudsters from all private companies, such as airlines, not just from banks, utilities and employers.
What has the government said?
Writing in the Sunday Telegraph, work and pensions secretary Liz Kendall said it was "absurd" that investigators' powers had not been updated in the last 20 years.
She said: "My team are still, in 2024, sending letters to gather evidence for those suspected of welfare fraud, slowing them down to a snail's pace when they could be shutting down serious fraud cases.
"Our bill will give them similar powers as HMRC to investigate fraudsters - it's time we give them the tools they need for the fight."
She said enhanced information-gathering powers would allow the state to "stop serious fraud in its tracks by making sure people really are who they say they are".
However, the powers will not extend to the state pension, with Kendall saying such a move would not be "proportionate".
What have privacy campaigners said?
The plans have sparked alarm among privacy campaigners, with Big Brother Watch describing them as "Orwellian" and "a major expansion of government power" that threatened the presumption of innocence.
Director Silkie Carlo said: "In their desperation to look tough on welfare, this is an eye watering, unjustified overreach and the end of financial privacy as we know it.
"These are powers more typical of a counter-terror context - it's a blatant assault on the poor to do this to Britain’s welfare system."
Kendall dismissed claims that the government would be "snooping" on people's bank accounts as "nonsense" and insisted there would be human oversight of automated alerts flagging potential fraud.
Polling suggests the public is on the government's side when it comes to benefit fraud crackdowns.
A YouGov survey last month asked 3,566 Britons if they supported or opposed fraud investigators being able to access people's bank accounts if there is a suspicion they are claiming benefits they are not entitled to. Of those, 64% were in support while 24% opposed the measure.
Why is the government doing this?
Since coming into office, Sir Keir Starmer and chancellor Rachel Reeves have repeatedly claimed there is a £22bn "black hole" in the public finances left by the previous government.
The Institute for Fiscal Studies (IFS) has disputed this claim in part, saying that while some of the challenges facing Labour "genuinely appear to be greater" than anticipated, much of it was "entirely predictable".
However, Reeves is looking to raise nearly double this - up to £40bn - in tax hikes and spending cuts in the 30 October budget, with the government looking to signal that it wants to avoid any return to austerity.
The Fraud, Error and Debt Bill, announced by Starmer at the Labour Party conference last month, is part of the plan to raise more money.
The government claims fraud and error in the welfare system costs the taxpayer £10bn a year. The expected savings delivered by the government's proposals - including reported measures to take money from bank accounts and pay slips - would amount to an average of £320m per year.