Truly shocked by Tory bank trials for benefit claimants.

[caringcarer]

When Tory's suggested looking at people's bank accounts to stop benefit fraud I thought they might catch out just a few people so it would be pointless doing it. I've just seen this article in local press and I couldn't believe my eyes about the number of bank accounts having an average of £50k yet claiming UC or low income benefits fraudulently. It was a real eye opener. Anyone else shocked?

www.birminghammail.co.uk/news/uk-news/dwp-tries-bank-account-checks-29191387

What whataboutery?

I said nothing about anyone/thing else bar that I'd want to see better figures from a Tory output in a dumbed down piece from the Mirror syndicate.

I agree too. I’ve a friend who inherited a reasonable but in the scheme of things, small amount (20k)
she is low income single mum to a Sen child, unlikely to ever have another chunk of money like that. So what’s and needs to save it to do things like, replace a fridge, replace her car when it dies nothing extravagant and nothing excessive. Yet she has to use it to live rather than protect herself from the inevitable poverty issues later on.

Yes fine, I'd be happy for them to do this.

But I'm also happy for them to verify that benefits aren't being fraudulently claimed.

They are separate issues.

@canp Definitely. Investigate both

She could do what other people have to do - get one off fb marketplace, put on a credit card, rent one ? In terms of a car of her child is severely disabled she could get a motability car or use taxis ? Nobody NEEDS £20k and benefits just in case !

Looking in people's bank accounts is intrusive. Introduce it to check the better off are paying what they should and hear the howls of protest. The people clamouring for it would be the first to complain if they were on the receiving end and assumed to be a fraudster. It's the first step to reducing or even eliminating low income benefits as they will gradually bring in more monitoring, restrict what you can spend money on etc. I can honestly see the poor being driven back to a life of sackcloth dresses and gruel by this lot if they are not voted out.

PEOPLE WITH 50k IN THE BANK ARE ‘BETTER OFF’!!!!!

Just wanted to flag a few points as the article does make it sound like large amounts of money in the bank are much more prevalent than they likely are.

8.4% of accounts were found to be "in risk" of breaking financial rules. So over 90% were not. We don't know how many of those 60k accounts have actually broken the rules. Some might be cases of being under transitional rules or have some other temporary disregarded cash (sale from one house about to be a deposit for another for example).

The average value of these accounts was £50k. Using the average here would not be advisable, as averages are skewed by outliers. The average could have been increased significantly by a small handful of accounts having exceptionally large balances. The median or more figure would tell a clearer picture. Also, again we don't know which balances have actually broken any rules, so it's meaningless.

Lastly the article doesn't make it clear how the accounts were selected or which bank used. Without this information it's not possible to tell if this is a representative sample of the population or not.

I'd also worry about the competence of those doing the checking.

Concentrix/Tax Credits

Late chasing and unreasonable action re UC claims in the pandemic

Carers Allowance

And that's just three big cases that have been in the news.

I’ve actually been through the compliance process a few years ago. I don’t know why I was flagged up to investigate but I was - it was a face to face interview and they asked me to provide bank statements for all accounts and it was really straightforward I just thought they have to check and I was fine with that

Agree. Nobody is going to have 30k lying around in the bank by mistake, nor is anybody checking going to mistake £1,000 for £100,000. It should be straightforward and if they can recoup £4 billion a year then it should be done.

I think it might be a good idea to stipulate that benefits should not be used for gambling, bur it probably unworkable.

HMRC already do this to adjust tax codes for savings income. This applies to the better off. They should monitor for benefit fraud if a similarly efficient way is possible

Wealthy people use their wealth to hide and protect their wealth.
They are not cleaner or more honest they just have a greater ability to cover things up!

It is, without doubt, unworkable. So is stopping it being spent on alcohol or tobacco.

I couldn't give even the tiniest shit about benefit fraud, given the grand scheme of things.

Given we lose more money to it than non payment of private school VAT, non doms and dodgy covid contracts..? Shall we leave all them alone as well?

They've always done this, it's nothing new.

What's proposed now is new.

DWP will, in future, be able compel the banks to watch for and disclose to them certain types of activity including large sums, spending abroad etc. where people are claiming benefits.

of Course she could. It’s what she’s done her entire life.
so what happened was her universal credit got stopped when she declared it
she spent a few months living off that excess until she got down below the 16k then had to restart her claim which took more time. By which point the inheritance had gone lower.

just seems an incredibly short term way of looking at something to me for what was ultimately not a huge amount

There is a reason the lottery is called a poor tax

The savings limits have been £6k & 16k for years, they have never increased in line with benefit increases, what £6k was worth when the limit was introduced is probably at least £8k now. Just like the earnings limit for carers allowance, they should be increased to reflect today's value.

Err yes, that's what benefits are there for. Those in a precarious situation. Not those who have a nice fat cash buffer and earn low income.

A friend of mine got asked by the DWP to explain why she'd had a large amount of money in her account and which then had disappeared

Yes, she and her (recently disabled) dh had sold a house and had moved North and bought a new one that was lot cheaper, so they could be mortgage free (as her dh was never going to be able to work again ), so this was the short time the money had been in her bank account.

So no fraud, because they were doing their best not to be a burden on the state.

Fortunately her reason was accepted - but it's exactly the sort of finer detail that is needed in "reports" about raw statistics like this

Agree completely @NDmumoftwo !
However I think things have become blurred, partly because so many people who have full-time jobs also need to claim benefits.
As I understand it they need to claim benefits in large part because wages are too low relative to housing costs.