Benefits claimants who concealed savings, investments and other financial assets cost British taxpayers a record £1.325 billion last year, according to new Department for Work and Pensions figures, intensifying calls for a tougher crackdown on welfare fraud.
The latest figures suggest fraud involving undeclared capital has reached its highest recorded level, with more than £25 million being lost every week through claims where savings or other assets were not properly disclosed.
The biggest losses came through Universal Credit, where more than £1.04 billion was attributed to claimants failing to declare savings that could have affected their entitlement.
The total is up sharply from £982 million in 2021–22, highlighting what critics say is a growing challenge for Britain’s welfare system.
Under current rules, most benefit claimants must declare savings and other capital because these can affect eligibility and the amount of support they receive.
Deliberately failing to disclose assets may constitute benefit fraud and can lead to repayments, financial penalties or prosecution.
The DWP has stepped up efforts to recover money lost through fraudulent claims, but the latest figures indicate that undeclared savings remain one of the largest sources of welfare fraud.
The figures have reignited political debate over the government’s handling of welfare fraud.
Opposition politicians argued the losses demonstrate weaknesses in enforcement and fraud detection, while the government has previously said it is investing in enhanced data-sharing powers, technology and investigations to identify fraudulent claims and recover public money.
Shadow Work and Pensions Secretary Helen Whately said: “Billions of pounds of taxpayers’ money is lost to benefit fraud each year. People are abusing and gaming our welfare state, and this undermines public trust in it.”
She added: “After two years in office, Labour is failing on welfare reform, failing on welfare savings and so far they have been failing to stop welfare fraud too.”
The competing arguments come as ministers face mounting pressure to control welfare spending while protecting support for people who genuinely qualify for assistance.
Recent prosecutions illustrate how undeclared savings can lead to significant overpayments.
In one case, a woman admitted fraud after receiving more than £40,000 in Universal Credit while holding savings above the level she had declared.
In another, a claimant continued receiving benefits after inheriting around £44,000, despite the inheritance affecting her entitlement under welfare rules.
Such cases represent only a small proportion of the millions of benefit claims made each year, but they illustrate how investigators identify fraud through financial checks and other evidence.
The scale of the losses is likely to increase calls for stronger fraud prevention measures.
The government has announced plans to expand the use of data analytics and information-sharing to identify suspicious claims more quickly, while continuing efforts to recover money obtained through fraud.
Supporters say stronger enforcement is essential to protect taxpayers’ money and maintain confidence in the welfare system.
Critics caution that anti-fraud measures must also avoid creating unnecessary barriers for legitimate claimants or incorrectly targeting people who comply with the rules.
Benefit fraud forms only part of the overall level of incorrect welfare payments, which also include claimant mistakes and official administrative errors.
Nevertheless, with public finances under pressure, reducing fraud linked to hidden savings has become an increasingly important priority.
The latest figures underline the challenge facing policymakers: protecting the integrity of the welfare system while ensuring that support continues to reach those who are entitled to it.
A DWP spokesman said: “The Government inherited a broken system, but we now have stronger powers to go directly to banks and check what fraudsters are really sitting on as part of a commitment to save £14.6bn over the next five years.
“If you’re hiding savings to claim benefits you’re not entitled to, our message is simple – we will find out, stop the payments and recover money.
“We’re committed to tackling all types of fraud and error and have already reviewed over a million Universal Credit claims via our Targeted Case Review and stopped £1bn in incorrect payments.”
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