The UK government is launching a significant initiative to combat benefit fraud, which cost taxpayers £7 billion in 2024, marking what officials describe as the 'biggest crackdown in a generation.'

Central to this effort is the New Public Authorities (Fraud, Error and Recovery) Bill, which aims to save the Department £1.5 billion over the next five years as part of a broader initiative to save £8.6 billion overall.

The government plans to address both accidental errors in claims and deliberate fraud, particularly targeting those who exploited Covid benefit schemes.

To strengthen its enforcement capabilities, the legislation extends the time limit for civil claims against Covid fraud from six to twelve years, allowing for more thorough investigations.

Secretary of State for Work and Pensions, Liz Kendall, has stressed the importance of imposing stricter consequences for benefit fraudsters to safeguard taxpayers' money.

DWP investigators will now have the authority to obtain search warrants, enabling them to assist police in seizing evidence related to fraud cases.

In a move to recover funds more effectively, the DWP can directly withdraw money from the bank accounts of individuals who owe debts, provided there are sufficient funds available.

Fraudsters who fail to repay debts exceeding £1,000 may face driving bans of up to two years, with the DWP empowered to secure court orders for such penalties.

The government has announced five key actions to combat fraud, including driving bans and enhanced checks on bank accounts belonging to suspected fraudsters.

Banks will play a crucial role in this crackdown by being required to notify authorities about potential breaches of benefit eligibility rules, helping to prevent fraud before it occurs.

New safeguards will be implemented to ensure fairness in the enforcement of these measures, including comprehensive training for staff and oversight mechanisms for vulnerable customers.

The bill will enhance the Public Sector Fraud Authority's ability to detect and recover fraudulent payments, improve information sharing, and introduce civil penalties as an alternative to criminal prosecution.