DWP pays £850million to dead claimants in benefits error as Reform UK slams 'appalling' scandal

Joe Sledge
Tue, 07 Apr 2026 07:51:11 +0000

The Department for Work and Pensions (DWP) has paid out £850million in benefits to deceased individuals since 2021.

The payments stem from approximately 2.6 million separate errors, involving a combination of mental health support, unemployment benefits and the state pension.

Fewer than half of the overpayments have been recovered, raising concerns about the department’s ability to safeguard public funds.

The figures, obtained by The Telegraph, place renewed pressure on Pat McFadden, who is responsible for overseeing welfare spending and ensuring that incorrect payments are reclaimed where possible.

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Britain’s annual benefits bill stands at around £300billion, making losses on this scale particularly significant.

Lee Anderson, Reform UK’s spokesman for work and pensions, said: "An absolutely appalling scandal that exposes just how badly broken the system has become."

He added: "Nearly a billion pounds of taxpayers’ money has been paid out to people who are no longer alive, and ministers have known about the problem for years yet failed to fix it.

"Both Labour and the Conservatives have shown time and again that they cannot be trusted with the public’s money."

The issue has developed over several years, with ministers from successive governments facing questions over why more effective safeguards were not introduced sooner.

The findings are also likely to increase scrutiny on Torsten Bell, who has recently taken action in a separate case involving financial oversight.

The TaxPayers' Alliance criticised the scale of the errors, with Shimeon Lee saying: "These figures show a department that has lost its grip on basic administration."

He added: "Funnelling nearly a billion pounds to deceased claimants is a staggering waste of taxpayers’ money. The Government must simplify the welfare state and standardise eligibility so there is a streamlined system that prioritises accuracy."

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The problem extends beyond core benefits, with additional payments also affected.

Since April 2023, around £27million in winter fuel payments has been issued to nearly 83,000 individuals who had died before receiving the funds.

This is partly due to the structure of the scheme, under which eligibility is determined in September but payments are made later in the winter.

Officials have said that in some cases, death notifications are received too late to prevent payments from being processed, or arrive at the same time as transfers are being made.

Further complications arise when claimants enter hospital or move into care, as certain benefits are typically paused after 28 days, creating scope for administrative delays.

In some instances, the cost of recovering smaller overpayments may exceed the value of the funds involved, which can amount to several hundred pounds.

A spokesperson for the DWP said: "It is DWP policy to recover all debt where it is reasonable and cost effective to do so."

They added: "We encourage anyone who has recently lost a loved one to use our Tell us Once service, which makes it easy to notify us and other Government services of a death in one simple step."