Public Authorities (Fraud, Error and Recovery) Bill

Neil Duncan-Jordan Excerpts

Report stage & 3rd reading
Tuesday 29th April 2025 Commons Chamber

The carers investigation is ongoing. It is not set to report until later this summer, yet the Government are rushing ahead with the proposals in the Bill. I suggest to colleagues that they do not back these proposals until we hear that investigation’s findings and see what lessons can be learned.

[Neil Duncan-Jordan (Poole) (Lab)]

I rise to speak in support of amendments 10, 11 and 12, which stand in my name. I would like to start, though, by placing on record my thanks to the Minister for Transformation, my hon. Friend the Member for Stretford and Urmston (Andrew Western), including for his willingness to engage in a discussion on the terms of this Bill. It has been extremely helpful, so I wanted to place that on record.

I also make it clear that my amendments do not in any way seek to undo or frustrate the Government’s legitimate aim of recovering public money from fraudsters and criminals. We absolutely need to do that to ensure that criminal behaviour does not undermine the benefits, legitimacy or standing of our welfare system. The Bill rightly seeks to tackle organised crime and online fraud, but worryingly it also ushers in dangerous new powers compelling banks to trawl through financial information.

[Jon Trickett (Normanton and Hemsworth) (Lab)]

I am grateful to my hon. Friend for giving way, and I support his amendments. The fact is that millions of innocent people whose behaviour has attracted no suspicion at all will be subject to intrusion into their bank accounts. Is it not odd that there is also access to bank accounts for the £40 billion of tax unpaid by tax avoiders, but that power is rarely used? In the last year for which I have seen figures, 300,000 people were suspected of tax avoidance, but only 1,000 had their banks investigated. Is it not the case that this legislation appears to treat wealthy tax avoiders differently from the poor?

[Neil Duncan-Jordan]

I thank my hon. Friend for his contribution. It is the very poorest in our society who will be most affected by this legislation. Banks will be able to trawl through financial information even when there is no suspicion of wrongdoing—that is the key point in this debate. The very poorest, including disabled people on PIP, older people on pension credit, carers and those on universal credit, will effectively have fewer rights to privacy than everyone else. I am also deeply concerned about the slippery slope of compelling banks to act as an arm of the state.

[Ayoub Khan (Birmingham Perry Barr) (Ind)]

I am extremely grateful to the hon. Member for tabling his amendments. We have the finest legal system in the world, and one of its principles is the presumption of innocence. As drafted, the Bill undermines that fundamental principle, which will raise stress and anxiety and undermine vulnerable people in our society. Does the hon. Member agree that that is the current position with the Bill?

[Neil Duncan-Jordan]

Yes, and I am going to address that point shortly.

It is not the purpose of banks to act as an arm of the state, and compelling them to do so sets a very dangerous precedent that we in this House need to be aware of. We also know that organised crime groups, which are responsible for more than £7 billion of large-scale fraud, will evade detection by spreading funds across multiple accounts, beyond the reach of the algorithmic scanning that will be used to flag overpayments. It will be welfare recipients who are caught up in the net of bank surveillance, regardless of whether they are suspected of fraudulent activity.

[Richard Burgon (Leeds East) (Lab)]

I congratulate my hon. Friend on his eminently reasonable and common-sense approach to this debate and on amendment 11. Does it seem to him, as it seems to me, that this legislation takes place in a wider context? Along with the proposed tightening of eligibility for personal independence payment, it moves us towards a hostile environment for benefit claimants, particularly disabled benefit claimants. We will end up treating them as suspects automatically. Does he agree that it was right for us to oppose this measure when the Conservatives wanted to do it? I tabled an early-day motion, signed by nearly 50 MPs, to that effect. We have to oppose this measure now. The best way to resolve it is by the Government accepting his eminently reasonable—

[Madam Deputy Speaker (Caroline Nokes)]

Order. That was a very long intervention. Perhaps we would be better off going back to Neil Duncan-Jordan.

[Neil Duncan-Jordan]

I thank my hon. Friend for his intervention. I will cover the connection between this piece of legislation and the Green Paper shortly.

[Neil Coyle]

Will the outcome for the individual disabled people my hon. Friend is concerned about—the vast majority of whom commit no fraud—be any different if these measures are implemented? They will not be affected, because they are not committing any crime.

[Neil Duncan-Jordan]

As I have tried to explain, the Bill introduces fundamental changes to the nature of our welfare system and its use.

[David Davis]

I am a signatory to amendment 11. In answer to the point that has just been made to the hon. Gentleman, if the banks use algorithms, they will have an error rate of at least 1%. That means 10,000 or more innocent people will be dragged through the system by this proposal.

[Neil Duncan-Jordan]

The right hon. Member brings me to my next point, which is the risk of a Horizon-style scandal on a massive scale, given the sheer volume of accounts that will be scanned. That is glaringly obvious. These new powers also strip those who receive state support of that fundamental principle of British law, the presumption of innocence, as the hon. Member for Birmingham Perry Barr (Ayoub Khan) said earlier.

Amendment 11 would ensure that the Government can tackle fraudsters, but would limit the use of an eligibility verification notice to cases where a welfare recipient is suspected of wrongdoing and not merely of error. That proportionate and necessary safeguard would prevent the corruption of our welfare system, which will turn it from a safety net—meant to offer dignity and support to those in need—into a punitive system, where accessing help comes at the cost of someone’s privacy and civil liberties.

The Bill grants the Department draconian powers to apply to a court to have people stripped of their driving licence if they have an outstanding debt, whether for overpayment, fraud or error. Amendments 10 and 12 would remove that power from the Bill. There are fairer and more effective ways to enforce the law. Analysis of the Bill has shown that where assessment deems that a financial deduction would cause hardship, the debtor can face losing their licence. That is not justice in my view, but a penalty for being poor.

I have heard the claims that this measure will be a last resort when the debtor has failed to engage over a period, but that overlooks the fact that non-engagement can be a symptom of hardship rather than wrongdoing. Many welfare recipients, including those with mental health conditions and caring responsibilities, find it difficult to navigate the complex bureaucracy of our social security system, and may be unfairly deemed not to have engaged with the DWP.

[Jim Shannon (Strangford) (DUP)]

It is important and necessary to have better legislation to look after people. I doubt that anyone in the Chamber has not been confronted by a constituent who has made an inadvertent mistake. Given the complexity of the paperwork and the reams of questions, it is beyond the ability of most people to respond. Does the hon. Gentleman share my concern, and that of many others, that if the system continues to be so complicated, it will inadvertently drive people into a position for which they are not responsible?

[Neil Duncan-Jordan]

I agree. I think that the complexity of our system lends itself to errors on the part of individuals who find it extremely difficult to navigate. In Committee, several witnesses explained that people avoid repayment for a variety of reasons, including not knowing where to get help, simply being overwhelmed by the whole process, or facing multiple debts. I hope that the Minister will provide further reassurance on that specific point relating to amendments 10 and 12.

All these challenges will only be made worse if the Government proceed with the planned cuts in disability benefits outlined in the recent Green Paper, which will affect more than 3 million families. The last Government stripped our welfare state to the bone during 14 years of deep cuts—disabled people are already far more likely to be in destitution and to rely on food banks—but spying on millions of people or piling cuts on to a failed system will not repair our welfare model. The Government must pause for thought, meet representatives of disability organisations, and build a fairer system with their consent and confidence. Our welfare state needs to provide support for those who need it, and the change that we promised as a Government must lead to a more compassionate and caring society—one that enables rather than penalises. These are the values that make us different from the last Government, and we should not forget that.

[Several hon. Members rose—]