Public Authorities (Fraud, Error and Recovery) Bill

Debate between Lord Sikka and Viscount Younger of Leckie

Committee stage
Monday 16th June 2025 Grand Committee

[Lord Sikka (Lab)]

I am very grateful to everyone for their contributions to this debate. I want to come back on a couple of issues.

I fully understand the arguments made against Amendment 79, but at the moment the individual becomes aware that something is afoot only much later in the day. Individuals rarely have time to seek legal advice. They often cannot afford legal advice. Early notification that they are subject to scrutiny, especially when they have never committed a crime and are just under suspicion, would mean that they may be able to save the DWP some time, effort and money on needless investigations. They may even be able to go to the local citizens advice bureau or somewhere else to get some advice. Leaving it until a much later stage inevitably means that there will be a lot of psychological stress for people. They will probably throw in the towel, a bit like the sub-postmasters, and think, “I’ve got to get off this merry-go-round. I will plead guilty even though I am not, because I cannot really contest anything with the Government”. So, I understand the arguments made, but I think that the current position of not telling the benefit claimants much earlier on really will lead to problems.

The Minister referred to the information provider’s duty for data protection and so on, but I have a concern, given that the DWP will make errors. It has a history of making thousands of them. Given that banks make errors in providing information, once DWP officials have received the information from the bank, they have to interpret that information and make sense of it. There will be misinterpretations, which will have serious consequences for the people affected.

The question to which I still have not heard an effective answer is: who will be liable? Who will pay the compensation? Will it be the public purse? Will it be the banks? The DWP will have a statutory relationship with the bank and hence can demand information, but banks are normally required to preserve confidentiality or financial information, and a bank will not ask anything from the individual concerned. It cannot at that point be said to owe a duty of care to somebody with whom it does not actually communicate, especially when that duty of care is eroded by the Bill. So the question remains: who will foot the bill, which could run into billions of pounds, if we end up with a similar situation to the one in Australia? I hope that the Minister can clarify that situation about who will foot the bill.

[Viscount Younger of Leckie (Con)]

Before the noble Lord sits down, I want to raise something, which is more of a question to the Minister and the team behind her. When I was in post, I became perhaps infamous, particularly when I did not understand something, for asking for a flow chart, and I wonder whether this is such a case where a flow chart would be extremely helpful. By that I mean that, when a process starts, what happens? One answers yes or no to questions and then it follows through with the safeguards included. I would find that incredibly helpful, and I suspect the team has one already. If there is one, I would find it helpful to see how the system works and where the safeguards are.

[Baroness Sherlock (Lab)]

I have never seen a flow chart, but some of these powers are not necessarily part of the same process, so they would not necessarily appear on the same piece of paper. But if I have any other way of explaining it, I would be very happy to do that.

Since I am on my feet, I reiterate that if the DWP is asking for information about an individual and it gathers information, it will most likely be doing so from a number of sources. An authorised officer will then review the information, and if there is felt to be a case for fraud, they will then interview the suspect under caution, who will be given the opportunity to get appropriate advice. There will be a process of engaging and discussion, but even before it gets to that stage, it is entirely possible that somebody will have reached out to find out the reason why an overpayment has been made. So, there are plenty of opportunities, and this specific amendment relates specifically to the extension of an existing power, which is used only when there is reasonable suspicion of fraud by a named individual. So, I do not think this amendment would help achieve the kind of things that have been discussed, and I urge the noble Lord to withdraw the amendment.