Campaigners claim new DWP bank-monitoring powers are ‘likely unlawful’

After scores of civil society groups oppose new measures, department claims any suggestions that the proposed powers will ‘reveal information about people’s movements, opinions and medical information are entirely false’

Campaigners have claimed that proposed new powers enabling the government to monitor millions of citizens’ bank accounts are “highly likely” to be unlawful.

The powers are provided for by changes to the Data Protection and Digital Information Bill proposed last year. If and when these updates pass into law, banks and building societies will be required to proactively provide the Department for Work and Pensions with information on account holders who, having understated their income or savings, are suspected of receiving state benefits in error or under fraudulent premises.

Currently, the DWP can only undertake checks of account data for a named individual who is already under suspicion of fraud. The new measures could apply to a cumulative total of more than 10 million people that receive one or more of Universal Credit, Employment Support Allowance, Pension Credit, or Housing Benefit.

Big Brother Watch has commissioned legal advice from specialised privacy lawyers who have concluded that the new measures are “likely unlawful” and would breach citizens’ legally enshrined rights to privacy, according to the campaign group.

“The legal advice warns that new government powers that would see banks forced to scan all customers’ accounts in search of welfare fraud or errors, including the state pension and working tax credits, would reveal information about people’s movements, opinions, and medical information and could breach privacy rights as well as individuals’ rights to freedom of expression, association and assembly, and protection from discrimination,” Big Brother Watch said. “Banks would then be required to send unlimited ‘matching’ account information to the Department for Work and Pensions without account holders’ knowledge.”

Big Brother Watch also pointed to a review of the proposed legislative changes published in December by information commissioner John Edwards, who noted  that the new powers would involve “significant intrusion”. The watchdog added that: “I have not yet seen sufficient evidence that the measure is proportionate” to the impact the new regime would have on tackling fraud.

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Silkie Carlo, director of Big Brother Watch, said: “These powers are a disaster for financial privacy and the presumption of innocence, and could lead to Horizon-style injustice on steroids. It is breathtaking that a Conservative government is so recklessly creating Big Brother-style spying powers to intrude on the population’s bank accounts. Everyone wants fraudulent uses of public money to be dealt with, and the government already has powers to review the bank statements of suspects. However, this is a completely unprecedented regime of intrusive generalised financial surveillance across the population, not restricted to serious crime or even crime at all. The legal advice is clear that the bank spying powers seriously risk Britons’ privacy rights. We urge the government to go back to the drawing board and scrap these Orwellian powers.”

In response to the group’s claims, a spokesperson for the DWP said: “Big Brother Watch’s claims that DWP will use these measures to reveal information about people’s movements, opinions and medical information are entirely false. The government remains committed to these powers as a method of reducing fraud and error in the benefits system, which will save the taxpayer £600m over the next five years. These measures will require third parties to provide only limited, relevant information that may signal whether benefits are being improperly paid. It does not give DWP access to anyone’s bank account or see how claimants are spending their money.”

Since the proposals were announced, Big Brother Watch has been at the forefront of campaigns against the new surveillance measures. The privacy advocacy group and was among 40 other civil society organisations – including Age UK, Mind, Disability Rights UK, and Liberty – that last month wrote to work and pensions secretary Mel Stride to oppose the measures. A total of 165,000 people have also signed a petition started by the group and calling on the government to ditch the new measures.

PublicTechnology reported that government’s formal impact assessment estimates that the new measures will result in about 7,400 benefit fraud prosecutions per year over the coming years – about a third of which will require legal aid support, and 250 of which are expected to result in custodial sentences.

Over the past three years, an average of fewer than 400 prosecutions were brought annually – meaning that the new powers are expected to result in a near-twentyfold increase.

The impact assessment revealed that government plans to test the data-sharing regime with two – unspecified – banks or building societies in 2025, with a full-scale rollout across all institutions from 2030 onwards.

Government indicated that this will encompass all of the 15 banks and building societies that, collectively, receive 97% of all benefit payments. This includes: Bank of Scotland; Barclays; Halifax; HSBC; Lloyds; Metro Bank; Monzo; NatWest; Nationwide; Santander; Starling; The Co-Op; Royal Bank of Scotland; TSB; and Yorkshire Bank.

Sam Trendall

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