The Department for Work and Pensions (DWP) is preparing to make use of new powers in 2026 to recover debts created by Personal Independence Payments (PIP)
The Department for Work and Pensions (DWP) is gearing up to launch a renewed crackdown on fraud and error. Officials are preparing to deploy fresh powers in 2026 to claw back debts arising from Personal Independence Payments (PIP).
According to government documents regarding the Public Authorities (Fraud, Error and Recovery) Bill, the new powers “will reform the legislative framework to safeguard taxpayers’ money by helping identify, prevent and deter fraud and error across the public sector, and enable the better recovery of debt owed to the taxpayer.”
The papers continue: “To meet the challenges presented by the scale of fraud and error, it is essential that all of government has access to the capabilities and tools required to investigate fraud, detect error and recover debt. This Bill will address the gap across the public sector and enable the PSFA enforcement unit to investigate and deal with public sector fraud outside of the tax and social security system.”
Officials have stated that the Bill will also “modernise DWP’s powers to ensure money spent is reaching those who need it, and not those who exploit the system. This will result in more money being recovered, more robust action being taken against those who attack the system, and an increased deterrent to potential fraudsters.
“The powers contained in this Bill to address overpayments in the social security system will be tough on criminals and fair for the taxpayer – and DWP claimants – that money in the public sector is spent wisely and effectively.”
The bill is projected to deliver total benefits of £1.5 billion over the next five years. For the DWP, the government asserts that the bill “forms part of wider government plans to save a total of £8.6 billion over 5 years in the biggest welfare fraud and error budget package in recent history.”
DWP minister Andrew Western summarised the government’s stance in comments made in the House of Commons late last year: “DWP is committed to tackling fraud and error in the benefits system and to the recovery of debts, including those generated by Personal Independent Payments. Working closely with counter fraud experts, the DWP has introduced measures to prevent fraud entering the system based on the types of cases and trends we have seen.”
New DWP measures to tackle benefit fraud
- Introducing more rigorous checks for customers changing personal details, including bank accounts
- Delivering awareness sessions for Case Managers and Healthcare Professionals, reinforcing action to take when suspicious cases are identified – for example, fake documents
- Strengthening the Identity and Verification Process to prevent fraudulent cases from entering the system
The minister went on to say: “DWP is delivering against key counter fraud activity, including investing in counter fraud professionals and building data analytical capabilities. The new Fraud, Error and Debt Bill will bring forward new measures to tackle fraud in the system.
“Details on the measures the Government will be legislating will be presented to Parliament in due course.”
The Department for Work and Pensions (DWP) supports nearly 24 million people across Great Britain with benefits, including 3.7m receiving Personal Independence Payment (PIP). The most recent DWP figures show that £330m was lost through fraud and error within the PIP system last year, marking a dramatic rise from £90m in 2023/24.
Fraud and error across the welfare system led to overpayments that hit taxpayers with a £9.5bn bill last year, down marginally from the £9.7bn recorded in 2023/24.
Fraud
GOV.UK guidance explains that this refers to claims where all three of the following conditions are met:
- The conditions for receipt of benefit, or the rate of benefit in payment, are not met
- The claimant can reasonably be expected to be aware of the effect on their entitlement
- Benefit payment stops or reduces as a result of a review of the claim
Claimant error
These represent cases where overpayments have happened due to claimants supplying incorrect or incomplete details, or failing to notify authorities of changes to their circumstances. Nevertheless, there is no indication of deliberate fraudulent behaviour by the claimant.
Official error
This happens when benefits have been awarded incorrectly due to administrative failures, delays, or erroneous assessments by the Department, local authorities, or His Majesty’s Revenue and Customs. This occurs irrespective of whether anyone beyond that department has played a part, even when the business unit has handled the information correctly.
PIP changes in circumstances
There are several changes in circumstances that people receiving PIP must inform the DWP about, or they risk losing their benefit entitlement and having regular payments paused or stopped.
Altering your name, GP, healthcare provider or address doesn’t require notification to the DWP and won’t influence your payments or award – though it’s sensible to ensure the information DWP has on record remains current.
Nevertheless, departing the country or intending to leave the country for more than four weeks – even for a simple holiday – could impact eligibility.
Instructions in the latest version of the PIP Handbook state: “This change may affect the claimant’s entitlement to PIP. We will need to know the date the claimant is leaving the country, how long they are planning to be out of the country, which country they are going to and why they are going abroad.”
If you’re set to journey overseas in the coming weeks, ensure you notify the DWP with the information they’ve requested as quickly as possible – and bear this in mind when arranging summer breaks this year.
How to report a change of circumstances to DWP
Ring the PIP enquiry line on 0800 121 4433 to notify of a change in circumstances – phone lines operate from 9am to 5pm, Monday to Friday. Below is a complete breakdown of all circumstance changes and whether you must contact the DWP regarding them.
Changes to daily living or mobility needs
Changes to your daily living or mobility requirements should be communicated to the DWP. This includes if you need more or less help, or if your condition is anticipated to last longer or shorter than previously stated.
Such changes could influence your Personal Independence Payment (PIP) eligibility, sum, and duration.
Leaving the country
If you’re considering leaving the country for over four weeks – even for a holiday – this could impact your PIP entitlement. The DWP needs to be informed of your departure date, the length of your stay, your destination, and the purpose of your journey.
Stays in hospital or similar institutions
According to DWP guidelines, both components of PIP stop being payable 28 days after admission to an NHS hospital. However, privately funded patients are not affected by these rules and can continue receiving either component of PIP.
If you’re in hospital or a similar institution when your PIP entitlement begins, PIP won’t be payable until you’re discharged.
For those in care homes, the daily living component of PIP stops being payable after 28 days if the accommodation costs are covered by public or local funds. However, the PIP mobility component can continue to be paid.
Those who fully self-fund their care home placement are not impacted by these rules. If a claimant is in a care home at the date of entitlement, the PIP daily living component is not payable until they leave.
Hospital stays and care home stays are considered linked if the gap between them is no more than 28 days. The daily living component for spells in a care home is also linked if the gap between them is no more than 28 days.
There is no link for the mobility component because payment is not affected when in a care home. Both components of PIP will cease to be paid after a total of 28 days in hospital.
The daily living component of PIP will stop being paid after a total of 28 days in a care home. If a claimant moves between a hospital and care home, or vice versa, these periods will also link.
Imprisonment or claimant held in legal custody
This change may affect the amount of PIP that can be paid to the claimant if they are imprisoned or held in legal custody. The DWP needs to know the date the claimant was taken into prison or legal custody and the length of time they are expected to be there, if known.
PIP ceases to be payable after 28 days where someone is being detained in legal custody. This applies whether the offence is civil or criminal and whether they have been convicted or are on remand.
Benefit payments that have been suspended are not refunded, irrespective of the proceedings’ outcome against the individual. Two or more separate periods in legal custody are linked if they occur within a year of each other.
Change of name
This alteration will not impact the payment or eligibility for PIP, but it’s important that the DWP has the most current details for the claimant. This change must be reported in writing – if the claimant phones to provide these details, the DWP will request that these details be put in writing. The written notification should include:
- full details of their previous name
- their new name
- details of any changes made to the bank or building society account into which PIP is paid, such as the name of the account or the account number
- their signature on the letter
Change of account PIP is paid into
The DWP requires full details of the name and address of the new bank or building society, along with details of the new account, including the name of the account, the account number and the sort code or roll number.
Change of person acting for the claimant
This refers to an appointee or someone with power of attorney for the claimant. This change is important so the DWP can make payments to the correct person at the right time.
They need the full name, address and contact details of the new person who is acting for the claimant. If the person acting for the claimant has moved or has different contact details, the DWP just needs the new details.
Change of address
Provided it’s not a hospital or nursing home, this change won’t impact the eligibility or payment of PIP. It’s crucial that the DWP has the most current details for the claimant. The DWP requires comprehensive information about the new address the claimant has relocated to, including the postcode and the date of the move.
Change of doctor or healthcare professional
This alteration will not affect the payment or eligibility for PIP and is not obligatory once a decision on the PIP claim has been reached.
However, if the change occurs during the claiming stage, it’s vital that the DWP possesses the most recent information. This ensures that the assessment provider has the correct contact details to collect any additional details they might need.
The DWP needs the full name, address, and contact details of the new doctor or health care professional. Complete details about changes of circumstance if you are receiving PIP can be found in the online handbook here.
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