Public Authorities (Fraud, Error and Recovery) Bill 2024-25: Progress of the bill

The Public Authorities (Fraud, Error and Recovery) Bill was introduced in the House of Commons on 22 January 2025. It had its second reading on 3 February 2025 and completed its Commons committee stage on 18 March 2025. It is scheduled for report stage on 29 April 2025.

This briefing provides an overview of the progress of the bill through the House of Commons prior to report stage.

The bill, together with its explanatory notes, impact assessment and transcripts of the parliamentary stages, are available on the parliament.uk website.

What would the bill do?

The bill would introduce new powers to enable the Public Sector Fraud Authority (PSFA) within the Cabinet Office to investigate public sector fraud outside of the tax and social security systems. The bill would also introduce new powers to enhance the Department for Work and Pensions’ (DWP’s) ability to tackle fraud and error in the social security system.

Part 1 of the bill extends to England and Wales only and includes measures relating to the Public Sector Fraud Authority (PSFA). It would give the PSFA powers to:

• investigate and recover fraud in any public authority
• initiate or adopt public sector fraud investigations at the request of an affected public authority
• compel information holders to provide information as part of a fraud investigation
• request communications data from telecommunications operators
• recover fraud-related debt directly from individuals’ earnings or bank accounts
• issue civil financial penalties
• bring action against fraud within an extended timeframe of twelve years

Part 2 of the bill extends to England, Wales and Scotland, and would give the DWP powers to address fraud and error in the benefits system and recover overpayment debt. These include:

• expanding the range of third parties the DWP can compel to provide information in support of criminal investigations
• providing ‘eligibility verification’ powers to allow the DWP to require banks and other financial institutions to examine their data to help identify benefit fraud
• giving DWP investigators new powers to enter and search premises with a warrant and seize relevant material
• allowing the DWP to recover debts from individuals not on benefits or in PAYE employment by direct deductions from their bank accounts without having to go to court
• extending the scope of ‘Administrative Penalties’ to include fraud involving a wider range of DWP payments, not just benefits

Both part 1 of the bill on the PSFA and part 2 on DWP fraud, error and debt recovery powers contain measures setting out safeguards, reporting mechanisms and oversight arrangements aimed at ensuring “the appropriate, proportionate, and effective use” of the new powers.

The Commons Library briefing Public Authorities (Fraud, Error and Recovery) Bill 2024-25, prepared for the bill’s second reading on 3 February 2025, gives an overview of the bill and initial comment on it.

Second reading in the Commons

The bill had its second reading on 3 February 2025.

The Secretary of State for Work and Pensions, Liz Kendall, said the bill would “help deliver the biggest ever crackdown on fraud against the public purse”, and that its provisions were both tough and fair.

The Shadow Work and Pensions Secretary, Helen Whately, said that in principle the Conservative Party supported the bill’s aims, but had questions about how the social security powers would work in practice and concerns about the powers the bill would give to Cabinet Office ministers and the PSFA.

The Liberal Democrat Spokesperson for Work and Pensions, Steve Darling, raised various concerns, saying it was too much of a “Big Brother Bill” and “snoopers charter”. He suggested to the government that they withdraw the bill.

Many MPs speaking in the second reading debate welcomed the bill as a proportionate and timely response to enable the government to tackle fraud against the public purse. However, they also voiced concern about the potential impact of new powers on civil liberties. There were also concerns about the impact of the bill on attitudes to benefit claimants.

The motion to give the bill a second reading was agreed (ayes: 343; noes: 87). The bill was committed to a public bill committee.

Commons committee stage

The bill was considered by a public bill committee over 12 sittings between 25 February 2025 and 18 March 2025.

The committee took oral evidence from expert witnesses during the first two sittings. It also received written evidence from outside organisations and individuals. The committee examined the bill line by line over the subsequent 10 sittings.

The committee examined part 1 of the bill over five sittings from 27 February to 6 March 2025. It agreed to three government technical or drafting amendments. No amendments tabled by opposition parties or backbenchers were agreed to.

Part 2 of the bill was considered over the final five sittings of the public bill committee between 6 March and 18 March 2025. A small number of minor government amendments were agreed. No amendments tabled by opposition parties or backbenchers were agreed.

Written evidence submitted by outside organisations and individuals to the public bill committee can be found on the bill page on the Parliament website.