The Department for Work and Pensions (DWP) has issued its first Eligibility Verification Notice to a financial institution, activating new powers intended to identify potential errors in benefit payments through checks on relevant bank accounts.
The move, confirmed on Monday 26 October 2026, marks the first operational use of the Eligibility Verification Measure (EVM), introduced under the Public Authorities (Fraud, Error and Recovery) Act 2025. Ministers estimate the measure could save taxpayers £1.2 billion by 2030–31. That figure is a forecast, not savings already achieved.
What has changed?
Under an Eligibility Verification Notice, a bank or other financial institution must compare relevant accounts against specified eligibility indicators supplied by the DWP. These are designed to identify possible discrepancies involving savings or time spent outside the UK that could affect entitlement to certain benefits.
The DWP says the initial implementation will be a controlled test-and-learn phase, allowing it to assess data quality, operational effects and outcomes before any wider rollout. The department has not announced that all banks or all benefit claimants are being checked immediately.
Which benefits are covered?
The powers currently apply to accounts associated with Universal Credit, Pension Credit and New Style Employment and Support Allowance. Financial institutions may also be required to check linked accounts, including joint accounts, where permitted by the rules.
According to published DWP guidance, information that can be returned where an indicator is met includes account-holder names, account identifiers, balances and limited dates associated with overseas transactions. The legislation and statutory code prohibit sharing transaction information or detailed spending histories through this measure. The DWP cannot log into customers’ online banking or monitor their accounts in real time.
Does a bank flag mean benefit fraud?
No. Ministers explicitly state that a bank flag is a prompt for further enquiries, not proof of wrongdoing. The DWP cannot determine or change entitlement solely on the basis of information obtained through EVM. Trained staff must consider the relevant evidence and established decision-making procedures.
The Government argues that the checks will help detect undeclared capital, incorrect payments and cases where overseas residence affects eligibility. The policy also raises questions about privacy, proportionality, errors in financial data and safeguards for people who are legitimately entitled to benefits.
Projected savings and Budget plans
The DWP estimates that EVM will save £1.2 billion by 2030–31, forming part of a wider programme that ministers say could save £14.6 billion through measures addressing fraud, error and debt. The department also says a further anti-fraud package is expected to be set out at Wednesday’s Budget, with projected savings of £1.4 billion between 2027 and 2032, including plans for additional anti-fraud staff.
These amounts are government estimates and should not be interpreted as recovered funds or independently established outcomes.
Oversight and next steps
A written statement to Parliament by DWP minister Lilian Greenwood says the system will be subject to independent oversight, with an Independent Reviewer expected to report annually to Parliament. The department has also published a statutory code of practice governing the use of notices and information-sharing safeguards.
The central change is that a power previously established in legislation has now been exercised for the first time. Its effectiveness, costs and impact on claimants will depend on the results of the initial testing and subsequent implementation.