Banks required to flag accounts breaching the savings limit
The Department for Work and Pensions has announced a crackdown on Universal Credit, with benefit recipients facing scrutiny across 18 indicators of potential fraud. The DWP is receiving expanded powers under the Labour Party government as part of efforts to tackle error and fraudulent claims.
A new ‘eligibility verification’ provision within the Public Authorities (Fraud, Error and Recovery) Bill will compel banks and financial institutions to share information to help detect instances where people may not be fulfilling the requirements.
This means banking staff will be obliged to notify the DWP when a claimant’s account balance exceeds the capital thresholds. Those claiming Universal Credit are permitted to hold up to £16,000 in savings across all accounts – exceeding this amount results in their entitlement ending, reports Birmingham Live.
The DWP said: “When we assess your entitlement to Universal Credit, we take into account as capital the value of all money, savings and investments you own, or jointly own with someone else. The amount you (and your partner) have can affect whether you’re eligible for Universal Credit, and how much you receive”.
Officials confirmed that all money, savings and investments held both domestically and internationally are included in the assessment. The following 18 categories of capital are combined to determine whether someone remains below the £16,000 threshold:
- cash
- money in your bank account
- current accounts and digital-only accounts such as PayPal
- savings accounts in a bank, building society, credit union, Help to Save, Post Office and National Savings and Investments (NS&I) accounts
- savings for children in your name
- money that belongs to someone else but is in your name
- savings for essential building work (unless from a grant or loan)
- savings for medical care
- Individual Savings Accounts (ISAs): cash, stocks and shares, Innovative Finance, Help to Buy, and Lifetime ISAs
- Premium Bonds, dividends, stocks and shares
- cryptoassets
- property you own but do not live in yourself (except in certain circumstances)
- property, land and savings abroad
- inheritance payments
- business accounts and assets for businesses that closed over 6 months ago
- money in trust funds, apart from in certain circumstances
- unspent benefits, such as Child Benefit, Personal Independence Payment (PIP) and Disability Living Allowance (DLA)
- unspent income
The DWP clarified that debts and the worth of personal belongings are not factored into calculations of a person’s total money, savings, and investments. There’s also no requirement to inform officials about:
- life insurance policies that have not been paid out
- funeral plan contracts
- savings or investments belonging to your children and in your children’s name
- business accounts and assets for businesses that are still operating or have closed in the last six months
