The Department for Work and Pensions (DWP) will begin sending letters this week to former benefit claimants who still owe money, warning them that failure to repay could result in a driving ban. Under sweeping new powers, the DWP can reclaim funds directly from bank accounts and, in serious cases, apply to court to revoke driving licences.
New Powers Target Debtors Who Refuse to Pay
Work and Pensions Minister for Transformation Andrew Western said: "Hardworking taxpayers deserve a system that pursues those who deliberately dodge their debts, and that is exactly what these new powers deliver. To anyone with an outstanding debt - our door is open and DWP will always work with you to find an affordable way to repay. But for those who can pay and won't - we're going further than ever before to claw back cash and crack down on fraud."
The new measures are designed to clamp down on fraudsters and debtors who "refuse to pay" back what they owe. Those potentially affected should begin receiving letters this week, urging them to "get in touch and pay up."
Phased Implementation from October
The DWP's full range of new powers will be phased in from October, leaving debtors just four months to settle their debts or arrange a manageable repayment plan. Official guidance stresses that people can avoid the full force of these powers simply by contacting the DWP. Staff are also available to direct individuals to free debt support services if needed.
Currently, those who owe money to the DWP and are receiving benefits typically repay through deductions from future payments. However, when claimants stop receiving benefits while still owing money, it becomes harder for the DWP to recover the funds.
Driving Ban Conditions
A driving ban can only be imposed on those who owe at least £1,000 and do not have an essential need for their licence—for example, if they rely on their vehicle for work as a courier. Initially, the licence will be suspended only as long as repayment terms are adhered to.
Cabinet Office Minister Satvir Kaur said: "Fraud against the public sector and unrecovered debt deny our vital frontline services of the funding they deserve. Under these new powers in the PAFER Act, this Government will deliver on its promise to protect hardworking taxpayers and clamp down on those who try to cheat the system."
