Public Authorities (Fraud, Error and Recovery) Bill

Baroness Bennett of Manor Castle Excerpts

Committee stage
Monday 16th June 2025 Grand Committee

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure briefly to follow the noble Lord, Lord Vaux, who made a typically powerful case. I echo his comments, particularly on the need for safeguards on the face of the Bill. We need only look across the Atlantic to see how badly things can go wrong and how important it is that there are laws on which future Governments—I am not at all referring to this Government—can be held to account.

I support all the amendments in this group, but I will focus particularly on Amendment 79, in the name of the noble Lord, Lord Sikka, which would insert:

“A copy of the information notice must be sent to the parties affected by the notice”.


In considering that amendment, I looked at reports today from the horrific case of Nicola Green, the mother of a teenager with cerebral palsy, who was pursued by the DWP for more than a year, having been accused of fraudulently claiming nearly £3,000 in carer’s allowance. The DWP—this is the point of the story that is relevant to this amendment—wrote to her employer without her knowledge to try to take money from the pay of this part-time college worker who works less than 14 hours a week. That is a demonstration of how people need awareness so that they can know what is going on. To finish the story of Ms Green, last month the tribunal judge ruled in her favour and said that she had done absolutely nothing wrong. The DWP did not attend the hearing and then said that it was planning to appeal against the judge’s ruling. A few days ago, the Guardian got involved and Ms Green has now been told that she will not be pursued and she will receive information on how she can claim for compensation.

That is one case, but what we are looking at here is when a case is getting started, if we assume that there are reasonable grounds, as the noble Lord, Lord Vaux, has outlined should be put on the face of the Bill. If the DWP asks for this information and it has got something horribly wrong and has misunderstood the whole situation, as we know happens all too often, the claimant who knows about the information request will be in a position—hopefully, without going through the year of turmoil that poor Ms Green has gone through—to be able to stop the matter at that point.

Amendment 79 is, therefore, a terribly important amendment. I hope that we might hear from the Minister an ironclad, watertight statement that this will happen anyway, but if that is not what we hear, I will encourage the noble Lord, Lord Sikka, to bring the amendment back on Report, because it is an absolutely crucial issue.

[Lord Palmer of Childs Hill (LD)]

My Lords, these amendments in the names of the noble Lords, Lord Sikka and Lord Vaux, on the information-gathering powers of the DWP, provide greater clarity and safeguards regarding the collection and consequences of information requests under the Bill.

Amendments 76 and 78 both address liability and aim clearly to establish which party is responsible for any consequences arising from the provision of incorrect information. This clarification will, I hope, be important in ensuring that all parties understand their responsibilities and the potential implications of their actions, thereby promoting fairness and reducing uncertainty.

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[Baroness Bennett of Manor Castle (GP)]

I thank the Minister for giving way. It is important that we identify something here. I mentioned that case study because there are, of course, many carers in this situation. As I understand it, the DWP is considering prosecuting carers where it regards the outstanding sum to be more than £5,000. In November, the Guardian reported that more than 250 unpaid carers were potentially facing prosecutions for fraud under DWP guidelines. I fully acknowledge the points made on this—the noble Viscount, Lord Younger, made some useful points—but I think that there are two different sorts of case here. There are undoubtedly criminal gangs organising frauds, where, yes, you would not want to do so in those cases, but in the cases of these carers you know that it is one person and this may cause issues. There are two different use cases here that might need to be approached in two different ways.

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[Lord Verdirame (Non-Afl)]

My Lords, I agree with many of the concerns that have been expressed in connection with this group, but I will say a few words specifically in support of Amendment 79B in the names of the noble Lord, Lord Vaux, and the noble Baroness, Lady Kramer. As it stands, paragraph 1(1) in new Schedule 3B affords a very broad discretion to the Secretary of State. It says that the Secretary of State may, for the named purposes,

“give a person of a type mentioned in paragraph 2 a notice … requiring the person to take the following steps”.

On its face, this is an unfettered discretion—or, rather, it is a discretion limited only by the purpose. Other than those purposes, the discretion does not, on its face, have a limit. The power that the Secretary of State has under this clause is very broad because, on receiving those notices, the banks or financial institutions will have to take those two steps. Perhaps later we will explore the step in connection with the eligibility indicators, which is potentially quite intrusive.

It seems to me that the language proposed in the amendment would identify a standard—reasonable satisfaction—that would have to govern the exercise of this discretion. In that respect, together with a number of other amendments also proposed by the noble Lord, Lord Vaux—but particularly in the context of this power—the amendment seems extremely sensible. I urge the Government to consider it and, in due course, accept it.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I attached my name to the Clause 74 stand part notice tabled by the noble Baroness, Lady Kramer, and Amendment 80 tabled by the noble Lord, Lord Davies. The stand part notice is a simple solution, but the amendment of the noble Lord, Lord Davies, effectively, has the same impact, which is ensuring that you can investigate only when there is cause to investigate. I do not care which way it is done, but it is very clear—I associate myself with every word said by the noble Lord, Lord Davies of Brixton, here—that we are now at the sharp end of the Bill. As the noble Lord said and as I understand it, this is unprecedented in British law. This is going trawling; it is a fishing expedition and a mass intrusion. As the noble Lord said, quoting the DWP itself, it is about “‘persons unknown’ at scale”—that is an extremely telling phrase.

To put this in context, today the High Pay Centre put out its annual report on fat cat pay, which exposed what a hugely unequal society we have. It found that, on average, the top payees in organisations were getting 52 times as much as the median paid worker. The most extreme case of this that it found was the security and waste group Mitie, whose CEO was being paid 575 times the median salary of the workers. That is a comparison to the median but of course we know that many of those Mitie workers will be on the minimum wage or very near the minimum wage, and they will be in receipt of the benefits explicitly identified in the Bill. They will face their bank accounts being trawled through without their knowledge, while the CEO, with that lovely and enormously high pay level, does not face the same intrusion. This is a fundamental inequality in our society that is actively dangerous in terms of building the divisions within society.

The noble Lord, Lord Palmer, powerfully introduced the clause stand part notice, but I note his Amendment 89, which would ensure that the Bill may be used only in relation to the benefits listed in the Bill. I will not do the full Henry VIII story but, as is very obvious—it was made clear in the briefing I think we all received from the Justice organisation—with the Henry VIII powers, the Government can extend this to any other benefit. The one that immediately comes to mind, given how much it is in the headlines at the moment, is the personal independence payment—PIP—and the issues and the level of fear that already exist around that. I cannot remember the specific occasion, but I suspect that the Minister will have joined me, under the previous Government, in questioning Henry VIII clauses. This would shut the door on a Henry VIII clause, and it urgently needs to be done. I commend the noble Lord, Lord Palmer, for identifying that and putting the amendment down.

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There are two ways to do it: either we throw everything in at the beginning and Parliament approves it, but then we can do anything we want; or we start here and say, “If the situation changes, we will make an appropriate change with parliamentary oversight”. The fact that the DPRRC and the Constitution Committee have not objected suggests that we are in the right place.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the Minister made a powerful point about the position of the current Opposition. As she identified, the old-age pension being covered in the former iteration of the Bill caused an enormous amount of concern. Obviously, all the groups we are talking about are potentially vulnerable, but old-age pensioners are particularly vulnerable and prone to be stressed and worried about this situation. Can the Minister assure me that the Government will not put the old-age state pension underneath the Bill?

[Baroness Sherlock (Lab)]

My Lords, I am grateful to the noble Baroness for giving me the opportunity to recover my voice and to say that not only will we not do it but the Bill says explicitly that the measure cannot be used on the state pension, so there is no question of it being used for that.

The case load is really straightforward. Fraud in the state pension is so low that it is the one area where the NAO does not qualify the accounts. We have to have a rationale. The reason we have chosen these three benefits initially is specifically because they are the areas where fraud is significant, and we know the information is out there that could make a difference. I can absolutely reassure the noble Baroness on that point: without amending primary legislation, this measure cannot be used on the state pension, and the Government will not do that. Any subsequent Government would have to change the law to be able to do it. I am grateful to the noble Baroness.