Bill would force banks to carry out ‘mass surveillance’ of millions of innocent disabled people, MPs are told

A new government bill would force banks to carry out “mass surveillance” of millions of innocent disabled people and other benefit claimants, MPs have been warned.

The measures in the bill would force banks to examine individuals’ accounts for potential breaches of benefit eligibility rules, and then pass that information to the Department for Work and Pensions (DWP).

A series of opposition MPs raised concerns about the measures on Monday during the second reading of the public authorities (fraud, error and recovery) bill.

Among disabled people’s organisations (DPOs) that have previously expressed alarm at the bank spying powers are Greater Manchester Coalition of Disabled People, National Survivor User Network and Disability Rights UK.

Although there are concerns about much of the 116-page bill, which was published less than a fortnight before Monday’s second reading, it is the measures that will force banks to spy on benefit claimants that have most alarmed DPOs and allies such as the civil liberties campaigning organisation Big Brother Watch and Public Law Project.

Work and pensions secretary Liz Kendall told MPs on Monday that the measures would force banks to provide data to “help identify incorrect benefit payments people might be getting, including fraudulently, such as if someone has too much in savings, making them ineligible for a benefit, or if they are fraudulently claiming benefits abroad when they should be living in the UK”.

But independent MP Zarah Sultana said the “algorithm-driven financial surveillance” allowed by the bill would lead to errors that would disproportionately affect disabled and older people and “those already struggling to make ends meet”, and create “a two-tier justice system”.

She said: “Even a one per cent error rate in the AI system used by banks could lead to thousands of benefit recipients being wrongly flagged, unfairly investigated and forced into lengthy appeals.”

She said the bill would allow “mass surveillance” and was “deeply unjust” and would “subject millions of innocent people – disabled individuals, carers, jobseekers, pensioners and parents – to unwarranted financial surveillance, treating them as suspects by default, simply because they receive state support”.

It would, she said, turn banks into “agents of the state”.

Another independent MP, John McDonnell, the former Labour shadow chancellor, said the government was seeking powers for a “mass surveillance exercise”.

He said: “The reason why people will feel that it is unfair is that it specifically targets people who are often in desperate need.

“If there was a group of people whose accounts we would want to monitor because there has been a history of fraud, and who have had to pay money back – some have gone to prison – it would be MPs; I was here during the expenses scandal.”

He said: “The atmosphere that we now have is a climate of fear, and I am worried that this debate will add to that climate of fear.”

He pointed to academic research from 2015 which found that a DWP programme to reassess people on incapacity benefit through the work capability assessment was linked to 590 suicides in just three years.

And he highlighted how these concerns were raised in The Department*, written by John Pring, editor of Disability News Service, which exposes how DWP covered-up evidence of these and other deaths and refused to act to make its social security systems safe.

The Welsh Liberal Democrat MP David Chadwick, who spent seven years as a data protection consultant, said the bill represented “an intrusion by the state into the privacy of individual citizens” and would give the government “sweeping powers to access and monitor the personal financial records of citizens, even without any evidence of suspicious activity to justify such actions”.

He said: “Under the bill, individuals could be presumed guilty until proven innocent, with their personal data shared, investigated and scrutinised without sufficient cause or due process.

“We have all seen the devastating impact of errors made by the Department for Work and Pensions on individuals.

“Such a system could lead to disastrous consequences, where it falsely flags someone as fraudulent due to simple administrative errors or unintentional mistakes.”

And he said the bill “risks creating a two-tier society where certain groups are subjected to intrusive financial monitoring by the state while others are not, which would undermine the principles of equality and fairness that our society is built on”.

The Green MP Sian Berry said the heart of the bill had been retrieved by Labour from the “most dark corner” of the last Conservative government.

She said it was “based on blame and suspicion of people in need of help” and had “a focus on fraud when a far bigger issue is unclaimed and under-claimed benefits due to a lack of awareness, complexity in the system and stigma”.

She said she was most concerned about the new bank measures and called on the government to “start again with a process of genuine listening and co-production, with those who claim social security, about appropriate, fair, respectful and secure ways of ensuring that people in need of support can receive what they are entitled to”.

But Kendall told MPs: “People should not be getting benefits they are not entitled to, and the alerts will make the process of identifying potential fraudsters much simpler, quicker and easier.”

She insisted that DWP “will not be able to access people’s bank accounts or look at what they are spending” and “will not share any personal information with banks”, while “any final decision about someone’s benefits will always be taken by a human being”.

Andrew Western, the DWP minister for transformation, said he did not share concerns about the “potential erosion of data protection powers”, and said the new powers would involve “very limited data sharing”.

He said DWP was “not monitoring accounts, and we will fine banks if they overshare in that space”, and the department “will not ask banks to take decisions on whether somebody has committed fraud”.

He said: “Banks will not make decisions – a human within the DWP will carry out that investigation.”

He pointed to concerns about potential errors in this new system, and said the department intended to “scale it up in a ‘test and learn’ phase, doing so gradually so that we can get it right, but we simply cannot ignore the problem and not look to take these powers when we had a £7.4 billion problem with fraud in the DWP last year”.

Debbie Abrahams, Labour’s chair of the Commons work and pensions committee, said: “I believe that there is a genuine commitment from ministers to change the DWP’s culture and build trust with its service users, but the bill will be seen by many as more evidence not to trust the DWP and not to engage.”

She said the bill was “too important for us to mess it up and for innocent people to become the victims”.

Steve Darling, the disabled Liberal Democrat MP and shadow work and pensions spokesperson, said it was unclear what safeguards there would be around the use of artificial intelligence.

He said DWP was “a broken department” and he pointed to the research linking DWP with the 590 suicides.

He said: “I suggest to the secretary of state that, while one understands the aspirations of this bill, it is far too much of a Big Brother Bill.

“It is far too much of a snoopers’ charter, and I suggest to the government that they withdraw it.”

Kendall claimed her bill would “deliver the biggest ever crackdown on fraud against the public purse” and that the measures were “tough but fair”.

She said the bill was “tough on the criminal gangs and individuals who cheat the benefit system, and it is fair to claimants who make genuine mistakes, by helping us to spot and prevent errors earlier”.

She even appeared to channel the controversial words of the former Conservative minister for disabled people, Tom Pursglove, who once promised in a heavily-criticised video posted on social media: “We will track you down. We will find you. And we will bring you to justice.”

Kendall tweaked Pursglove’s clumsy parody of a line from the violent Liam Neeson thriller Taken, warning: “We will find you. We will stop you. And we will get our money back.”

The independent MP Richard Burgon pointed out that only 0.2 per cent of personal independence payment (PIP) claims in 2022-23 were fraudulent, and that “as we pursue organised criminal gangs, it is really important that we make it clear that there cannot be a hostile approach to disabled people claiming PIP or disabled people more widely who are using the benefits system as they deserve to”.

Kendall replied: “People who are genuinely entitled to claim benefits have nothing to worry about from this bill, but we believe that the £7.4 billion wasted every year through benefit fraud must be cracked down on.”

The bill’s second reading was passed by 343 votes to 87, and it will now proceed to its committee stage.

*The Department: How a Violent Government Bureaucracy Killed Hundreds and Hid the Evidence, DNS editor John Pring’s book on the years of deaths linked to DWP, is published by Pluto Press

A note from the editor:

Please consider making a voluntary financial contribution to support the work of DNS and allow it to continue producing independent, carefully-researched news stories that focus on the lives and rights of disabled people and their user-led organisations.

Please do not contribute if you cannot afford to do so, and please note that DNS is not a charity. It is run and owned by disabled journalist John Pring and has been from its launch in April 2009.

Thank you for anything you can do to support the work of DNS…