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Banks risk a fine if they do not share information with government agents when asked
Albert TothWednesday 03 December 2025 13:46 GMTComments
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The Department for Work and Pension’s (DWP) ‘bank spying bill’ has come into force and gives government agents new powers to tackle benefits fraud.
The Public Authorities (Fraud, Error and Debt) Bill gives DWP agents new powers to request information from benefit claimants’ bank accounts, and to directly recover funds in certain circumstances.
The key power that will enable to DWP to request banks to share financial information with its agents is called the Eligibility Verification Measure. It means that when a new Eligibility Verification Notice is sent to a bank or financial institution, it must comply with the request.
The information the institution can be asked to share includes information about the account holder, including their name and date of birth.
Agents can also ask for the bank account’s sort code and account number, as well as details about how the account meets eligibility. Transaction information should not be shared by banks, the DWP says.
open image in galleryThe bill gives DWP agents new powers to request information from bank accounts, and to directly recover funds in certain circumstances (John Stillwell/PA) (PA Wire)Banks and other financial institutions can be issued penalty notices for not-complying with these requests.
Ministers say the government is introducing these powers to be able to determine if an individual is eligible for a benefit they are claiming or have applied for based on their financial position.
For example, holding over £16,000 in savings generally will render someone ineligible for Universal Credit, except in certain limited circumstances.
The measures are understood to have a planned implementation period of 12 months using ‘phased approach’ and working with a smaller number of banks initially.
The DWP will also gain controversial new powers to directly deduct money from an individual’s earnings or bank accounts using a ‘Direct Deduction Order’.
open image in galleryThe key power that will enable to DWP to request banks to share financial information with its agents is called the Eligibility Verification Measure (Getty/iStock)Baroness Maeve Sherlock, a minster of state for the DWP, said earlier this year that the department estimates it will make between 5,000 and 20,000 Direct Deduction Orders every year.
The new powers have been introduced as part of a raft of measures Labour say will form the “biggest fraud crackdown in a generation.” The government adds that, combined, the plans will save £1.5 billion by 2029/30.
But campaigners have criticised the new powers as “intrusive,” with civil liberties watchdog Big Brother Watch previously warning that it “threatens to usher in an unprecedented system of mass financial surveillance.”
Minister for transformation Andrew Western MP said: “It is right that as fraud against the public sector evolves, the government has a robust and resolute response.
“The powers granted through the Bill will allow us to better identify, prevent and deter fraud and error, and enable the better recovery of debt owed to the taxpayer.
“A benefits system people can trust is essential for claimants and taxpayers alike – through this Bill that’s exactly what we’ll deliver.”
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