BENEFIT cheats could be banned from driving if they repeatedly fail to pay back cash to the taxpayer, under a new Government drive to curb welfare fraud.

The Department for Work and Pensions (DWP) will also be able to recover money directly from fraudsters’ bank accounts, in what has been dubbed the biggest fraud crackdown in a generation.

The Public Authorities (Fraud, Error and Recovery) Bill, which would put the measures into law, is due to be introduced in Parliament on Wednesday.

It will help save the taxpayer £1.5 billion over the next five years, the DWP estimates.

Once the Bill is made law, benefit cheats could be disqualified from driving for up to two years if they refuse to repay money they owe.

Courts could suspend fraudsters’ driving licences following application by the DWP, if they owe welfare debts of more than £1,000 and have ignored repeated requests to pay it back.

The department will also have powers to get bank statements from people they believe have enough cash to pay back welfare debts, but are refusing to do so.

The DWP however insists it will not have direct access to people’s bank accounts.

“We are turning off the tap to criminals who cheat the system and steal law-abiding taxpayers’ money,” Work and Pensions Secretary Liz Kendall said.

She added: “This means greater consequences for fraudsters who cheat and evade the system, including as a last resort in the most serious cases removing their driving licence. Backed up by new and important safeguards including reporting mechanisms and independent oversight to ensure the powers are used proportionately and safely.

“People need to have confidence the Government is opening all available doors to tackle fraud and eliminate waste, as we continue the most ambitious programme for government in a generation – with a laser-like focus on outcomes which will make the biggest difference to their lives as part of our Plan for Change.”

In an attempt to provide assurance about the Bill, ministers will bring forward codes of practice for those who will use the new powers.

They also plan to introduce new oversight and reporting mechanisms to monitor how the powers are used.

Elsewhere in the Bill, the Public Sector Fraud Authority will be given more powers to tackle Covid-era fraud.

Helen Whately, the shadow work and pensions secretary, welcomed the measures, and claimed they were a “continuation” of the Conservatives’ work in power.

She added: “But having knowingly appointed a convicted fraudster to his cabinet, Keir Starmer cannot be trusted to get tough on fraud.

“Labour must do more to tackle the spiralling welfare budget, and explain why they are yet to match our £12 billion in savings – raising the prospect that Rachel Reeves will be back again later this year with another tax raid on working people.”