Public Authorities (Fraud, Error and Recovery) Bill

Debate between Lord Verdirame and Lord Vaux of Harrowden

Committee stage
Monday 16th June 2025 Grand Committee

[Lord Vaux of Harrowden (CB)]

My Lords, Amendments 84 and 85 attempt to strengthen important safeguards around the use of information that is gained through an EVM. The Minister has quite rightly said that the scope of the information the banks can provide in response to an EVM is tightly limited. She is right, and that is a very significant improvement to the previous incarnation of the Bill. As currently framed, the only information that can be provided to the Secretary of State by the bank is specified details about the account, such as sort code and account number; specified details about the account holder, such as name and date of birth; and specified details about how the account meets the eligibility indicators. It is also clear in the Bill that transaction data or special category data may not be provided. So far, so good and, as I said, it is a great improvement.

But there is another important potential loophole here. Clause 72 gives the Secretary of State the power to require much more intrusive information if the Secretary of State

“has reasonable grounds to suspect that a person has committed, is committing or intends to commit a DWP offence”.

So, if the existence of an eligibility indicator alone would meet the threshold of “reasonable grounds to suspect”, then the tightly drawn restrictions on the data that banks can provide under an EVM become somewhat meaningless. It will just move on to the next phase almost automatically. We have had a lot of discussion around automation, and I agree with the noble Baroness, Lady Fox, that given the volumes of data that will be provided over time, it seems extremely likely that it will—in fact, it is extremely unlikely that it will not—be processed automatically by the DWP, which will choose which ones to investigate more deeply. We have heard about the human elements and will come on to those in the second amendment in this group. but the code of practice does not cover the transfer from EVM to Clause 72’s more intrusive data searching.

Nothing in the code of practice or the Bill would prevent this eligibility indicator being used as reasonable grounds to suspect and, therefore, the Clause 72 provision being triggered with no other safeguard. There may be many reasons why the existence of an eligibility indicator might be entirely innocent. The impact assessment and the noble Baroness have given the example of authorised disregards and genuine error—and genuine error on the part of both the individual and the department. So it seems that, before exercising the robust and intrusive powers under Clause 72, much more should be required, or at least more should be required, than just the existence of an eligibility indicator alone, and I stress “alone”. That is what Amendment 84 tries to achieve, and I think this is probably in line with what the noble Baroness intends, so I hope that this or something like it will be acceptable.

The second amendment, Amendment 85, deals with another critically important safeguard. In response to various concerns raised about the use of algorithms, algorithmic processing, the use of AI and so on, the noble Baroness has stated very clearly that information must be reviewed by a human person before action is taken, and a previous group discussed how bias and stereotyping can creep into automated systems—I will not repeat that. But again, the human element—the human review—does not appear anywhere in the Bill. There is a reference to human decision-making in paragraph 4.31 of the draft code of practice:

“No data source is perfect or infallible. That is why in fraud and error, a human will make any final decisions that affect benefit entitlement, and any indications of potential fraud or error will be looked at comprehensively”.


But this does not set out any level of seniority or qualification, and it covers only final decisions that affect benefit entitlements and not, for example, decisions to affect the intrusive investigative powers that Amendment 84 is looking at. More importantly, the code of conduct can be changed at will by the department; there is no parliamentary oversight or what have you.

As I have said before, I do not doubt the noble Baroness’s intentions in this respect, but the Bill will outlast her tenure and indeed her party’s tenure. Future Governments or Ministers may not have vulnerable people’s interests at heart in the same way that she does. Imagine a future Government applying a DOGE-style approach to this.

The requirement for any decision to be taken by a suitably qualified and senior human is such an important safeguard that I believe it must be in the Bill and not left to the whim of any future Government who might wish to simply automate the whole process—and they could do that: they just change the code of conduct. The issue is not about decisions that affect benefit entitlement alone; as I say, appropriate human review should cover also the use of the more intrusive powers under Clause 72, and the code of conduct does not cover that at all.

I am very happy to discuss the wording, but the principle of suitably qualified and senior human review before decisions are taken is, for me, one of the key safeguards. I hope the noble Baroness will be able to look sympathetically at this amendment, especially as all it does, I think, is to codify what she has consistently said will be the case. I beg to move.

[Lord Verdirame (Non-Afl)]

My Lords, I will be very brief. I very strongly support everything that the noble Lord, Lord Vaux, has said on these two amendments. They are some of the most important amendments that have been debated today because they go to a very fundamental principle. The power in Clause 72, with the new Section 109BZB, is quite significant, and we need to have limits to the exercise of this power in the Bill, both as regards the reasonable grounds—that is Amendment 84—and as regards the human decision-maker. I will not repeat the noble Lord’s reasons because I thought he put his case so compellingly, but I am very much in favour.

Public Authorities (Fraud, Error and Recovery) Bill

Debate between Lord Verdirame and Lord Vaux of Harrowden

Committee stage
Monday 9th June 2025 Grand Committee

[Lord Verdirame (Non-Afl)]

My Lords, I, too, have a few comments to make on these amendments. I very much support the intention behind them. I would like to understand a bit more about Clause 34 and how it will operate. Paragraph 219 of the Explanatory Notes says:

“This clause introduces a process for review of deduction orders by an authorised officer of a higher grade than the original decision maker upon application by relevant parties”.


As far as I can see, there is no mention in the legislative text of the authorised officer who conducts the review being of a higher grade. Perhaps I have missed it, and it is somewhere else; if so, I would be grateful to know where. If it is not somewhere else, it may be that the Explanatory Notes made that point on the basis of general principles of administrative law. Either way, it would be useful to know where that comes from.

My second point concerns the grounds for review, which are very narrow. Clause 34(4) says:

“An application for a review under this section may not be made on, or include, any ground relating to the existence or amount of a payable amount (unless the amount is said to be incorrectly stated in the order)”.


The grounds for appeal in the following clause are equally narrow. Is my understanding correct that the reason these grounds are so narrowly drawn is that there has already been a final determination of the payable amount by a court or tribunal—which was the reference to Clause 12 that we were given earlier on? Can the Minister give us some examples of grounds for review, given how narrowly drawn that provision is in Clause 34(4)?

Finally, I note that there is no time limit imposed on the Minister for carrying out the review. The applicant would have to put in an application within 28 days, but they might just sit and wait for the outcome of that review for an indefinite period. Would it not be a good idea to include a clear time limit on the reviewer—ideally the independent reviewer—or the authorised officer for that review to be concluded?

[Lord Vaux of Harrowden (CB)]

My Lords, I will say very briefly that I support the concept, at least, behind these amendments. It cannot be right that the Minister marks his own homework. The noble Lord, Lord Verdirame, talked about what it says in the guidance notes. I do not know whether this is the right mechanism but, at the very least, if a review is to be carried out by the department, it must be by somebody who was not at all involved in the original decision and is not answerable to anybody directly involved in the decision-making process. That needs to be set in stone somewhere, not just in guidance notes or whatever that can be changed at a whim by any future Government. This is one of the weaknesses throughout this. We have lots of safeguards, but they are all in codes of conduct, future statutory instruments or whatever; they are not set in stone in the law and therefore are not strong safeguards. That is a general thought.

I have a feeling that I know what the answer will be: if they do not like the outcome of the review, they can go to the First-tier Tribunal. But that is a big leap from going back and saying, “Can we have an independent review?”. A First-tier Tribunal is, effectively, a full legal process. We need something that works and in which people can have confidence at the first level, before needing to take it to the much more legalistic, costly and complicated process of the First-tier Tribunal. I think the Minister will say that that is the answer, but I am not sure that I agree.