The Department for Work and Pensions says the aim is also to recoup more of the £1.2bn the government loses to benefit fraud every year. A No 10 spokesman said getting the welfare budget under control is “key.”
Credit references can already be checked by officials but are not often used and are dependent on tip-offs.
Prime Minister David Cameron believes calling in bailiffs to confiscate and sell expensive items, such as cars and computers, from cheats will be a strong deterrent to fraudsters. Low-value possessions and essential items are unlikely to be taken.
The spokesman said, “Getting the welfare budget under control is a key part of our long-term plan for the economy. We want to end the something-for-nothing culture and deliver for people who want to work hard and play by the rules.”
The government launched a scheme this year to encourage benefit claimants to disclose changes in their circumstances to help prevent overpayment, which costs £1.6bn a year.