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A few months ago I got into a heated battle on another side because I was right on the question but the OP did not believe me insisting the bank was failing in its duty to protect the customer by allowing direct payments with NI numbers on them to be shown on statements. With this in mind I decided to ask questions of DWP.
My first email is below(there are some responses so give me a chance to update first prior to comments, if any).
Dear DWP
I am a member of a consumer website and I am asking for some clarification from your office. The issue is with regards to Direct Payments. Why does the DWP, when they are sending payments to a UK bank account quote, National Insurance numbers on the payments of Incapacity Benefit, Disability Living Allowance etc,etc, and yet for Working Tax Credit and Family Tax Credit, no such NI number is given? Would it not be more appropriate for simply the name of the benefit be given or is there a specific reason for this?
I look forward to your response and I hope the question was clear.
Yours sincerely
NWSM
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I did edit out the person I wrote to but it was Mr Purcell minister for DWP
Their initial response was:
Dear NWSM
Thank you for your e-mail to the Secretary of State concerning Identity fraud issues. I hope you will understand that Mr Purnell is unable to deal personally with the vast amounts of correspondence that are received each day. Therefore, since your letter falls under the remit of this Department, I have been asked to respond and I am sorry for the delay in replying.
All benefits and pensions administered by the Department for Work and Pensions (DWP) use the customer's National Insurance number (NINO) as a reference for payments made through the Bacs automated clearing system.
Many of the benefits administered by DWP provide customers with their only source of income and entitlements to these benefits frequently change according to peoples’ income and circumstances. This means that payments made to the banks frequently have to be recalled and re-issued to ensure the customer is paid the correct amount of benefit. Using the NINO as a payment reference provides a full audit trail of individual transactions so that returned payments can be quickly traced and customer enquiries dealt with effectively.
Tax credits which are administered by Her Majesty’s Revenue and Customs (HMRC) provide a top-up income, and whilst awards are updated as necessary to take account of changes of circumstance, payments are adjusted so that, where possible, HMRC pay the correct amount over the year. They do not have to recall and replace individual payments on the same scale as DWP.
I hope this explains why DWP presently has no alternative but to use the NINO as a payment reference. However, the Government is very much aware of customer concerns about NINOs appearing on their bank statements and whenever improvements in banking technology arise it will consider whether it can minimise the use of NINOs with the customer information it provides to the banks.
I hope that this is helpful.
Yours sincerely
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I still wasn't happy about that response so I wrote to them again......
Thank you for your response to my initial question about National Insurance Numbers but my understanding of banking systems is that where the money is being sent from A to B bank and there is no errors in the application of the account number and sort code, the automated way BACS works means that the UK Banking system cannot tamper with the payment in any way.
Can I ask you to explain to me the improvements in Banking systems that would allow you to change the present system? From my understanding the DWP would need to either (a) change their reference numbers as that would be what counts or (b) simply change the narrative sent to the bank to say State Pension or Job Seekers Allowance. Is that something that the DWP would consider looking into because the problem of this is not about banking systems but how the payment is sent and referenced.
I look forward to your response
Nattie
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Their response was
Dear Nattie
Thank you for your further e-mail.
Your understanding of banking systems is quite correct. It is the way that DWP ‘banking’ systems operate that the Department would be looking to change in order to remove customers’ National Insurance Numbers (NINO) from the narrative it sends to the banks.
As previously explained, the Department currently has no option but to use the NINO as a reference for payments sent to Bacs. However, I can assure you that the Department is actively pursuing the use of an alternative reference in response to customer concerns about their NINOs appearing on their bank statements.
Yours sincerely
My first email is below(there are some responses so give me a chance to update first prior to comments, if any).
Dear DWP
I am a member of a consumer website and I am asking for some clarification from your office. The issue is with regards to Direct Payments. Why does the DWP, when they are sending payments to a UK bank account quote, National Insurance numbers on the payments of Incapacity Benefit, Disability Living Allowance etc,etc, and yet for Working Tax Credit and Family Tax Credit, no such NI number is given? Would it not be more appropriate for simply the name of the benefit be given or is there a specific reason for this?
I look forward to your response and I hope the question was clear.
Yours sincerely
NWSM
------------------------------- merged -------------------------------
I did edit out the person I wrote to but it was Mr Purcell minister for DWP
Their initial response was:
Dear NWSM
Thank you for your e-mail to the Secretary of State concerning Identity fraud issues. I hope you will understand that Mr Purnell is unable to deal personally with the vast amounts of correspondence that are received each day. Therefore, since your letter falls under the remit of this Department, I have been asked to respond and I am sorry for the delay in replying.
All benefits and pensions administered by the Department for Work and Pensions (DWP) use the customer's National Insurance number (NINO) as a reference for payments made through the Bacs automated clearing system.
Many of the benefits administered by DWP provide customers with their only source of income and entitlements to these benefits frequently change according to peoples’ income and circumstances. This means that payments made to the banks frequently have to be recalled and re-issued to ensure the customer is paid the correct amount of benefit. Using the NINO as a payment reference provides a full audit trail of individual transactions so that returned payments can be quickly traced and customer enquiries dealt with effectively.
Tax credits which are administered by Her Majesty’s Revenue and Customs (HMRC) provide a top-up income, and whilst awards are updated as necessary to take account of changes of circumstance, payments are adjusted so that, where possible, HMRC pay the correct amount over the year. They do not have to recall and replace individual payments on the same scale as DWP.
I hope this explains why DWP presently has no alternative but to use the NINO as a payment reference. However, the Government is very much aware of customer concerns about NINOs appearing on their bank statements and whenever improvements in banking technology arise it will consider whether it can minimise the use of NINOs with the customer information it provides to the banks.
I hope that this is helpful.
Yours sincerely
------------------------------- merged -------------------------------
I still wasn't happy about that response so I wrote to them again......
Thank you for your response to my initial question about National Insurance Numbers but my understanding of banking systems is that where the money is being sent from A to B bank and there is no errors in the application of the account number and sort code, the automated way BACS works means that the UK Banking system cannot tamper with the payment in any way.
Can I ask you to explain to me the improvements in Banking systems that would allow you to change the present system? From my understanding the DWP would need to either (a) change their reference numbers as that would be what counts or (b) simply change the narrative sent to the bank to say State Pension or Job Seekers Allowance. Is that something that the DWP would consider looking into because the problem of this is not about banking systems but how the payment is sent and referenced.
I look forward to your response
Nattie
------------------------------- merged -------------------------------
Their response was
Dear Nattie
Thank you for your further e-mail.
Your understanding of banking systems is quite correct. It is the way that DWP ‘banking’ systems operate that the Department would be looking to change in order to remove customers’ National Insurance Numbers (NINO) from the narrative it sends to the banks.
As previously explained, the Department currently has no option but to use the NINO as a reference for payments sent to Bacs. However, I can assure you that the Department is actively pursuing the use of an alternative reference in response to customer concerns about their NINOs appearing on their bank statements.
Yours sincerely
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