Overview
- The Public Authorities (Fraud, Error and Recovery) Act 2025 allows the DWP to compel banks via Eligibility Verification Notices and, in some cases, recover money directly from accounts without a court order.
- Initial implementation targets Universal Credit, Pension Credit and Employment and Support Allowance, with checks reported to include joint accounts and some crypto holdings, plus deductions from wages that employers must carry out.
- Operational safeguards cited include reviewing recent statements, a minimum 28‑day window to challenge decisions, and recovery orders that typically take effect about 22 days after notice.
- The Public Accounts Committee is demanding annual transparency on use and impact, urging stronger prevention of official error, and highlighting a redress plan for 26,000 carers within a two‑year review of roughly 200,000 cases.
- The DWP says the regime has independent oversight and is intended to cut fraud and error, while new civil penalties include fines of up to £300 per day for non‑compliance and experts warn of privacy and false‑positive risks.