Claimants will face a two-year driving ban if they refuse to pay back welfare they received fraudulently
People convicted of benefit fraud will be stripped of their driving licences and welfare officers will have new powers to search suspects’ homes under draft laws unveiled today.
Tougher rules will mean claimants will face a two-year driving ban if they refuse to pay back welfare they have received fraudulently.
The Government will be able to apply to courts for the punishment for those owing £1,000 or over who have refused to pay the money back.
Officials in the Department for Work and Pensions (DWP) responsible for investigating organised crime-related benefit fraud will also receive new powers.
They will be able to apply for search warrants to raid premises and seize items – such as computers and smartphones – as evidence.
The DWP will be equipped to recover money from bank accounts of those no longer on benefits or in pay as you earn (PAYE) employment by requesting statements to prove they can repay what they owe.
Banks will have to alert officials when there may be a breach of eligibility rules for benefits but the government will not have access to accounts.
The government said the tough approach to fraud will “be underpinned by a principle of fairness and proportionality” with people offered “affordable and sustainable repayment plans” before being subject to the penalties.
Staff will be trained to ensure “safe use of the powers” and guidance for how they can be applied will be consulted on. The new powers will be a “last resort” for those who do not cooperate, the government said.
Ministers have promised to claw back £1.5bn over five years due to the Public Authorities (Fraud, Error & Recovery) Bill, introduced to parliament today.
Combined with other measures, the government claims the laws will save a total of £8.6bn. According to officials, fraud and error in the social security system costs around £10bn a year.
Work and Pensions Secretary Liz Kendall is under pressure to make significant welfare savings in the coming years.
And she has already committed to saving more than £5bn by 2030 through long-promised reforms to sickness and disability benefits.
A policy document spelling out how the government intends to cut welfare spending for disabled people is expected in spring but ministers are yet to set out any details as to how money will be saved.
The former Tory government had set out plans to save billions by restricting eligibility for those out of work with long-term sickness or a disability.
The Labour Government said it will maintain the savings but would do so differently, bringing forward their own changes.
The Conservatives questioned how the government would deliver on the significant welfare savings promised.
“Any genuine efforts to crack down on benefit fraud are welcome, and this is a continuation of our work in this area,”Helen Whately MP, shadow Work and Pensions Secretary said.
“Labour must do more to tackle the spiralling welfare budget, and explain why they are yet to match our £12bn in savings – raising the prospect that Rachel Reeves will be back again later this year with another tax raid on working people.”
Kendall, said she would be cracking down on “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,” she said.
“Backed up by new and important safeguards including reporting mechanisms and independent oversight to ensure the powers are used proportionately and safely.”
She said voters needed to have “confidence” the government was doing all it could to tackle fraud and waste.