Recommendation 29

HM Government Not Addressed

The Department already shares extensive data with local authorities. There are currently 28 bulk data shares with local authorities, some of which also include HMRC data, where information is shared between DWP and local authorities and vice-versa. These are used for a very wide variety of purposes including: • Housing Benefit administration • Local Council Tax Reduction administration • Discretionary Housing Payment administration • Household Support Fund administration • Blue Badge Disabled Parking Permit administration • Adult Social Care Financial Assessments • Various forms of Local Welfare Provision. These data sharing arrangements include but are not limited to: • access to the DWP Customer Information System, • daily notifications of relevant changes to DWP benefits, • access to PAYE earnings information, sourced from HMRC, and notifications of any changes to those earnings. Under the terms of a memorandum of understanding, local authorities have substantial freedom to re-use the data shared with them in accordance with legislative requirements. In line with data protection legislation, local authorities should seek their own legal advice when intending to re-use data shared by DWP, to ensure they are fully aware of any legal risks they may be taking. DWP also requests that local authorities notify DWP when they do intend to re-use such data. This is also in line with the requirements of data protection legislation and ensures that the Department is fully aware of any potential risks, including reputational risks. This data re-use process can be used by local authorities to help them identify people eligible for Pension Credit. Existing data shares allow local authorities to know about existing Pension Credit claimants. Local authorities who wish to increase Pension Credit take-up in their areas can source information via existing DWP data shares which can help them to identify households may be entitled to Pension Credit but are not claiming it. For example, DWP used housing benefit data, which local authorities provide to DWP, to identify and target households potentially entitled to Pension Credit for the ‘Invitation to Claim’ initiative in November 2024. Further data sharing is in the pipeline. In the next 12 months, we expect these to include: • more Universal Credit information being made available to local authorities via the Customer Information System – substantial improvements were delivered in June and August 2025 and we anticipate two further sets of improvements to the data being shared by March 2026. • an additional Universal Credit data share, which should make it searchable, filterable and downloadable – which local authorities have long requested. We anticipate a test version of this new strategic data share to be available to a small group of trial local authorities in the first half of 2026, and subject to successful testing, wider national rollout during the remainder of 2026–27. • Depending on the final policy design and requirements of the new Crisis Resilience Fund (CRF), there may be scope to add further data shares during 2027. In respect of the barriers to sharing more data with local authorities, the Department can only share data where there is a legal gateway to do so and for specified purposes. The existing legislation which governs data sharing limits what data can be shared, the conditions under which it can be shared and how it can be used. As an example, there is currently no legal gateway for the exchange of data between local authorities and DWP or vice-versa in relation to Council Tax which limits fraud prevention and debt recovery. Officials in DWP are investigating what might be possible in this area, with potential changes during the lifetime of this Parliament and an ambition for simplification of legislation that would allow DWP and local authorities to share customer data with each other for any relevant and appropriate purpose, subject to the strong protections that existing data sharing legislation provides—for example, principles around proportionality and data minimisation—as well as the strict governance processes that are designed to provide assurance that personal and highly sensitive data is kept secure and that access to data is limited. Simplifying data share legislation would allow: • Policies to be moved to delivery much quicker, without the need for ongoing changes to legislation, every time a new policy was announced. • Greater data sharing would be allowed, which in time would deliver more seamless delivery of welfare provision, both locally and nationally. • There would be significant reductions in fraud and error for both DWP and LAs. • Much greater clarity for DWP and LAs about what is and is not allowed. With the current complexity, some LAs are taking sensible legal risks on some of their data reuses, in order to deliver administrative efficiencies and local welfare provision to vulnerable citizens. Whereas other LAs are not reusing data