The Department for Work and Pensions has been granted sweeping new powers to pursue people who have stopped claiming benefits but still owe money to the department. Under the new measures, the DWP will be able to reclaim funds directly from bank accounts and, in the most serious cases, can apply to a court to revoke offenders’ driving licences.
The new rules are designed to clamp down on fraudsters and debtors who “refuse to pay” back what they owe to the DWP. Those potentially affected by the changes should begin receiving letters this week, warning them to “get in touch and pay up”.
Work and Pensions Minister for Transformation Andrew Western said: “Hardworking taxpayers deserve a system that pursues those who deliberately dodge their debts, and that is exactly what these new powers deliver. To anyone with an outstanding debt – our door is open and DWP will always work with you to find an affordable way to repay.
“But for those who can pay and won’t – we’re going further than ever before to claw back cash and crack down on fraud.”
The DWP’s full range of new powers will be phased in from October, leaving those who owe the department just four months to settle what they owe or arrange a manageable repayment plan ahead of the deadline. Anyone who receives these letters is strongly urged to act as quickly as possible, with official guidance making clear that people can avoid the full force of these new powers simply by getting in touch with the DWP.
It also notes that staff are on hand to direct people towards free debt support services where required.
Those who owe money to the DWP and are currently in receipt of benefits will generally repay these debts through deductions to their future payments. However, when people are still paying back these debts and stop claiming benefits, it becomes more difficult for the DWP to recover the outstanding funds.
The driving ban can only be imposed on those who owe the DWP at least £1,000 and do not have an essential need for their licence — for instance, if they rely on their vehicle for work as a courier.
Those who are banned will initially only have their licence suspended for as long as repayment terms are adhered to.
Cabinet Office Minister Satvir Kaur said: “Fraud against the public sector and unrecovered debt deny our vital frontline services of the funding they deserve.
“Under these new powers in the PAFER Act, this Government will deliver on its promise to protect hardworking taxpayers and clamp down on those who try to cheat the system.”