Dead people given £850m in benefits blunders
As published by The Telegraph on the 6th April 2026: More than 2.5 million errors with many believed to relate to mental health and out-of-work claims
By Harry Brennan, Henry Lloyd, Abigail Mableson and Lara Kipper
Read the original article here: https://www.telegraph.co.uk/money/tax/news/dead-people-receive-850-million-pounds-from-dwp/
Hundreds of millions of pounds in benefits have been given to dead people in a blunder uncovered by The Telegraph.
In a costly overpayment failure, the Department for Work and Pensions (DWP) paid out £850m in benefits to claimants after they had died.
It is not known which benefits were overpaid, but it is thought the 2.6 million errors since 2021 could be related to a mix of mental health and out-of-work benefits, state pension payments and others.
Pat McFadden, the Secretary of State for Work and Pensions, has an obligation to protect public money and recover overpayments wherever possible.
Yet less than half the £850m has been recovered – adding millions to Britain’s spiralling benefits bill, which costs taxpayers about £300bn each year.
Sir Keir Starmer, the prime minister, has faced repeated accusations of being soft on benefits following pressure from backbench MPs.
Last year, he made an about-turn on plans to tighten eligibility for personal independence payments (PIPs) despite concerns over a surge in claims linked to anxiety and ADHD.
He also backed down on plans to restrict winter fuel payments, in a move that added £1.25bn to the benefits bill, and gave in to pressure to lift the two-child benefit cap – adding £3bn a year.
On Saturday, The Telegraph revealed Government plans for an online self-service benefits system for PIPs, with an official trial of the system concluding the plans will result in a surge in claims.
The latest revelations on overpayments are likely to be embarrassing for Torsten Bell, the pensions minister, who sacked the boss of National Savings and Investments (NS&I) because of a separate “missing millions” scandal.
The Telegraph revealed how NS&I failed to pay £476m owed to bereaved families of up to 37,500 dead savers because of systems issues since 2008. Dax Harkins, the bank’s chief executive, was forced out over the fiasco.
Mr Bell and Mr McFadden are now facing questions about their own failings, with critics saying the benefits department has “lost its grip on basic administration” and asking why they are not doing more to claw back erroneous payments.
Hundreds of millions of pounds in benefits have been given to dead people in a blunder uncovered by The Telegraph.
In a costly overpayment failure, the Department for Work and Pensions (DWP) paid out £850m in benefits to claimants after they had died.
It is not known which benefits were overpaid, but it is thought the 2.6 million errors since 2021 could be related to a mix of mental health and out-of-work benefits, state pension payments and others.
Pat McFadden, the Secretary of State for Work and Pensions, has an obligation to protect public money and recover overpayments wherever possible.
Yet less than half the £850m has been recovered – adding millions to Britain’s spiralling benefits bill, which costs taxpayers about £300bn each year.
Sir Keir Starmer, the prime minister, has faced repeated accusations of being soft on benefits following pressure from backbench MPs.
Last year, he made an about-turn on plans to tighten eligibility for personal independence payments (PIPs) despite concerns over a surge in claims linked to anxiety and ADHD.
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He also backed down on plans to restrict winter fuel payments, in a move that added £1.25bn to the benefits bill, and gave in to pressure to lift the two-child benefit cap – adding £3bn a year.
On Saturday, The Telegraph revealed Government plans for an online self-service benefits system for PIPs, with an official trial of the system concluding the plans will result in a surge in claims.
The latest revelations on overpayments are likely to be embarrassing for Torsten Bell, the pensions minister, who sacked the boss of National Savings and Investments (NS&I) because of a separate “missing millions” scandal.
The Telegraph revealed how NS&I failed to pay £476m owed to bereaved families of up to 37,500 dead savers because of systems issues since 2008. Dax Harkins, the bank’s chief executive, was forced out over the fiasco.
Mr Bell and Mr McFadden are now facing questions about their own failings, with critics saying the benefits department has “lost its grip on basic administration” and asking why they are not doing more to claw back erroneous payments.
A total of £9.5bn in benefits were overpaid in 2025, official figures show, but more than two-thirds of this was because of fraud, while 20 per cent was because of claimant error. The figures obtained by The Telegraph show the scale of official error relating to deceased benefit claimants for the first time.
Lee Anderson, Reform UK’s spokesman for work and pensions, said: “This is an absolutely appalling scandal that exposes just how badly broken the system has become.
“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.”
Shimeon Lee, of the TaxPayers’ Alliance campaign group, said: “These figures show a department that has lost its grip on basic administration.
“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.”
The benefits overpayments are understood to have been made by DWP staff after a notification of death of a claimant was received too late to halt payouts, or arrived at the point of payment.
Overpayments also occur when benefit claimants spend time in hospital or go into care. These include PIP – the mental health benefit – and the disability living allowance, among others.
These usually stop or are suspended after a claimant has been in hospital for 28 days. While state pensions continue, means-tested benefits such as pension credit or jobseeker’s allowance may be reduced. Benefits generally resume if someone is discharged from hospital.
The overpayment figures exclude winter fuel payments, but The Telegraph has discovered that winter fuel payments have also been sent to the accounts of dead claimants. Some £27m in winter fuel payments have been sent to close to 83,000 dead people since April 2023.
Winter fuel payments are paid out after claimants are accepted for the handouts in September, meaning by the time they are paid at the start of winter some claimants have already died.
It is thought in some cases the cost of recovery could end up being higher to the taxpayer than the cost of the overpayments themselves, which typically run into the hundreds of pounds.
A DWP spokesman said: “It is DWP policy to recover all debt where it is reasonable and cost effective to do so. 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.
“Once we’ve been notified, we act quickly to update our records and make sure benefits only go to those who are entitled to them.”