DWP gains powers to seize bank account money for benefit debts

Summarised from 2 outlets · Updated 22 Oct, 12:33 · Archive

The DWP can now recover benefit debts directly from bank accounts without a court order.

The Department for Work and Pensions has introduced new debt recovery powers under the Public Authorities (Fraud, Error and Recovery) Act 2025, allowing it to recover certain outstanding benefit debts directly from bank accounts without a court order. The powers apply to people who are no longer receiving benefits and whose debts cannot be recovered through deductions from ongoing benefit payments or PAYE earnings. The DWP can order banks to make regular deductions or take a specified lump sum from an eligible account.

The DWP began writing to people with outstanding debts on 24 June, warning them that the new powers could be used to recover money owed. The department stated in its letters that the action 'can be avoided entirely by getting in touch with DWP within the next four months'. The deadline is 24 October for those who received the letters on that date, though recipients should check the specific deadline stated in their correspondence.

The powers are not an automatic seizure affecting everyone who has previously claimed benefits. The DWP must follow statutory procedures before making a direct deduction order, including obtaining and considering bank statements. Previously, the DWP had limited options to recover money from people who were no longer in the benefit system and refused to repay voluntarily.

How it is being reported

• The DWP can seize money from bank accounts under new rules – who is affected?The DWP can recover certain benefit debts directly from bank accounts without a court order. Find out who is affected and what to do if you receive a letter.Oxfordshire Guardian · 22 Oct, 12:00
• The DWP can seize money from bank accounts under new rules – who is affected?The DWP can recover certain benefit debts directly from bank accounts without a court order. Find out who is affected and what to do if you receive a letter.Oxford Mail · 22 Oct, 12:00

In this story: Department for Work and Pensions · Public Authorities (Fraud, Error and Recovery) Act 2025 · Oxfordshire

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