Labour adopts hated Tory bank surveillance and DWP search and seize powers

Labour is to revive the hated Tory plan to force banks to carry out surveillance on claimants’ accounts and give the DWP police type power to search premises and seize possessions.

The Tory provisions were contained in the Data Protection and Digital Information Bill, but this failed to be passed into law before the general election and was therefore scrapped.

Now, however, Labour have announced that they are to include what appear to be very similar provisions in a new Fraud, Error and Debt Bill.

According to the DWP, the new law will give the DWP powers to:

• Better investigate suspected fraud and new powers of search and seizure so DWP can take greater control investigations into criminal gangs defrauding the taxpayer.

• Allow DWP to recover debts from individuals who can pay money back but have avoided doing so, bringing greater fairness to debt recoveries.

• Require banks and financial institutions to share data that may show indications of potential benefit overpayments

The Tory bank surveillance provisions would have forced banks to monitor the accounts of all means-tested benefits claimants and report every time an account went over the capital limit or was used abroad for more than four weeks.

In late 2023, it was estimated that almost 9 million claimants would be caught in the Tory surveillance net, including:

• 8 million universal credit claimants

• 6 million employment and support allowance claimants

• 4 million pension credit claimants

That number is likely to have increased by now, especially with the push to get more people to sign-up for pension credit.

Labour’s new bill will also give the DWP the power to search premises and seize evidence, such as documents, laptops and phones.

The Tory Bill contained similar powers.

It would have allowed designated DWP staff to arrest claimants, search premises and seize any evidence they found without needing to use the police. The DWP said this would put them on a par with HMRC and the Gangmasters and Labour Abuse Authority (GLAA).

In an attempt to reassure claimants, the DWP today claimed that:

“The Bill will also include safeguarding measures to protect vulnerable customers. Staff will be trained to the highest standards on the appropriate use of any new powers, and we will introduce new oversight and reporting mechanisms, to monitor these new powers. DWP will not have access to people’s bank accounts and will not share their personal information with third parties.”

Labour claim that these powers will only be used against criminal gangs. But, until we see the text of the bill, we will have no way of knowing whether the law will actually prevent the DWP using their new powers against individual claimants if they so choose.

The outline of the new bill was published today by the DWP to coincide with Kier Starmer’s first speech as prime minister to a Labour party conference.

In his speech, Starmer made only a brief reference to the new bill, saying, “If we want to maintain support for the welfare state, then we will legislate to stop benefit fraud and do everything we can to tackle worklessness.”

Back in April of this year the then prime minister, Rishi Sunak, outlined his plan to give the DWP police powers. He did this whilst setting out his five point plan for welfare reform in a speech at the right-wing think tank, the Centre for Social justice, founded by Iain Duncan-Smith.

Just five months later, Keir Starmer has announced similar measures, this time in a speech to the Labour party conference.

The other four Sunak points were:

• The WCA to be made harder to pass

• GPs no longer to issue fit notes

• Legacy benefits claimants to move to UC sooner and work requirements to be increased

• PIP no longer always a cash benefit and fewer people to be eligible

We will now have to wait for Labour’s welfare reform white paper to see whether any of the four remaining points will also be adopted as Labour policy.