New laws that would give the government sweeping powers to carry out financial surveillance on benefit claimants would also pose a serious risk to disabled people who have set up bank accounts to pay for their social care, campaigners warn.
Measures in the data protection and digital information bill, currently being considered by the House of Lords, would give the Department for Work and Pensions (DWP) powers to force banks to scan all their accounts to find those account-holders receiving benefits, as well as people connected with those accounts.
They will then have to report anyone who triggers what are seen as potential indicators of fraud to DWP.
Under current rules, DWP can only request details of a bank account holder’s transactions if there are reasonable grounds to suspect them of fraud.
The civil liberties campaign organisation Big Brother Watch has already warned that the potential for “expansive surveillance, high rates of error, and disproportionate impact on people in vulnerable positions is huge”.
But there are now concerns that the new powers would also see disabled people with care and support needs wrongly triggering fraud indicators, having their benefits suspended and being forced into intrusive interviews by DWP fraud investigators.
This is because disabled people who receive direct payments from their local authority to fund their care must set up separate bank accounts to accept that funding, and these accounts often hold thousands of pounds.
Dr Sarah Campbell, principal co-author of the Spartacus report in late 2011, which led to the We Are Spartacus online movement, has raised concerns with her MP about potentially being caught in such a trap.
She is concerned about the automated nature of the proposed system and how it could accidentally target disabled people on direct payments.
She believes she would be flagged up as a potential benefit fraudster because of her separate care account, which is currently several thousand pounds in credit.
Rick Burgess, a spokesperson for Greater Manchester Coalition of Disabled People (GMCDP), said the new powers would subject claimants to “second class status, reverses the constitutional assumption of innocence until proven guilty, and removes our right to privacy.
“It would be highly detrimental to anyone living with distress from anxiety or paranoia.”
GMCDP and the tech justice campaign group Foxglove are involved in a legal process over how the DWP uses algorithms to detect fraud, while GMCDP is also part of a coalition of rights groups convened by the civil liberties organisation Big Brother Watch, which is campaigning against the government’s proposed bank surveillance powers.
Burgess said: “We also know the DWP is highly secretive about its use of surveillance technology and that mistakes happen but are not acknowledged.
“Someone on direct payments could run the risk of non-disabled system designers and technology mistaking perfectly legal transactions as signifiers of fraud, because they are not familiar with how disabled people on direct payments organise their accounts.
“Furthermore, family members may find their financial privacy being compromised simply by interacting with those under DWP surveillance.”
Disability Rights UK (DR UK), which is also part of the Big Brother Watch coalition, called on the government to withdraw the “dangerous provisions”.
Fazilet Hadi, DR UK’s head of policy, said: “Whilst separate bank accounts are set up for the receipt of direct payments and to enable monitoring of payments and whilst the DWP is informed of these arrangements, the surveillance methods won’t pick up these nuances.
“Instead, it is likely that benefit claimants with more than one bank account will be highlighted and targeted.
“The unwarranted intrusion into people’s bank accounts is absolutely horrific and the potential for victimisation is likely to increase where there is more than one account.”
After Campbell’s MP, Dr Alan Whitehead, passed on her concerns to DWP, he received a response from the disabled Conservative MP and pensions minister Paul Maynard.
Maynard told him that “capital fraud and error, where claimants fail to declare or under declare savings, is consistently in the top four highest causes” of benefit fraud and error.
He said in the letter: “We know data exists outside the DWP which would help us tackle these losses therefore, gaining access to third-party data is an important and effective lever to help reduce benefit fraud and error.
“This measure requires third-parties to look within their own data and provide relevant information to the DWP that may signal where claimants do not meet the eligibility criteria for the benefit they are receiving.
“On examination, this data may suggest there is fraud or error and require a further review by the DWP, through business-as-usual processes to determine whether wrongful payments are being made.
“We will only seek to obtain minimal information on claimants that have been paid a benefit to enable further enquiries.”
He claimed that DWP would not use the proposed new powers to “monitor how claimants spend their money”.
He said the measure “does not target a particular group of benefit claimant, and where the data does not signal possible fraud or error there will be no further consideration or investigation”.
Maynard also claimed that “presently, the DWP equality analysis has not identified concerns about the impact on any groups with protected characteristics”.
But Campbell told Disability News Service (DNS): “The minister says this policy doesn’t target disabled people.
“A policy doesn’t have to intentionally target any one group to disproportionally affect it.
“Disabled people on direct payments must have care accounts in their name which can contain thousands of pounds.
“An automated system will wrongly and repeatedly assume their total personal savings are far higher than they actually are.
“No other group is in this situation, putting us at far higher risk of a fraud investigation unless a system is put into place to avoid this issue.
“We are already audited annually or even three-monthly on our care account. We do not need yet more scrutiny, interviews, stress and paperwork.”
Burgess said there was a “huge risk of mission creep” over DWP’s attempts to gain the new powers.
He said: “We know that once the state gains powers it invariably expands its use beyond the initial purpose.
“There is simply no way this power is practical, proportionate or democratic. It must be wholly opposed by anyone who believes in human rights.”
DWP told DNS that a human would always be involved in any decisions on any cases that were flagged by the algorithm and it claimed that any signals of potential fraud or error would be examined comprehensively.
It also claimed that it would not take any action where a claimant had income that should be disregarded for deciding DWP benefits.
But DWP declined to explain how an automated system would distinguish a claimant’s social care bank account from a personal account and so avoid incorrectly flagging a claimant for a possible fraud investigation.
It also declined to say how confident it was in the algorithm that would be used by banks to flag these accounts.
Instead, a DWP spokesperson said in a statement: “Direct payments for social care from local authorities do not affect entitlement to means-tested benefits – however, claimants still need to declare these types of payments so they can be disregarded.
“Our third party data measure will help modernise our fight against fraud – ensuring fairness within the system and that money goes to those who need it.
“This measure will not enable DWP to access any bank accounts or see how claimants are spending their money.”
DWP declined to explain why it wanted banks to pass on details of flagged bank accounts if it was not going to examine how claimants were spending their money.
Burgess said he believed DWP was simply being “pedantic” when it claimed that the new laws would not enable it to access bank accounts to see how claimants were spending their money.
He said he believed that once DWP had been alerted to a case of potential fraud – through the new powers – the next stage of its investigation would involve examining claimants’ transactions.
He also fears that – unless specifically prohibited in the wording of the new laws –advances in technology could eventually allow DWP to carry out “real time checking or sampling of accounts”, which would mean a frightening lack of privacy from the state.
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