Housing Benefit and Council Tax Benefit overpayments guide · The Housing Benefit and Council Tax...

Housing Benefit and Council Tax Benefit overpayments guide

The Housing Benefit and Council Tax Benefit overpayments guide has been archived.

The new Housing Benefit overpayments guide is at:

https://www.gov.uk/government/publications/housing-benefit-overpayments-guide

https://www.gov.uk/government/publications/housing-benefit-overpayments-guide

HB/CTB Overpayments Guide

Amdt3 September2010

Classification and recoverability

Contents


Classificationsofoverpaymentsandsubsidy...............................................................2.00

Overpaymentssubsidytable...................................................................................2.10

Explanationsoftheclassifications...............................................................................2.30

Eligibleoverpayments..............................................................................................2.31

Fraudoverpayments...........................................................................................2.31

Claimanterroroverpayments.............................................................................2.35

ReportingchangeofcircumstancestodifferentdepartmentsintheLA....2.36

Nodetailsprovidedofwheretoreportchangeofcicumstances............2.36

Detailsprovidedofwheretoreportchangeofcircumstances................2.38

‘Other’overpayments.........................................................................................2.39

LAofficialerrorandAdmindelayoverpayments..................................................2.50

Whichclassificationisappropriate?....................................................................2.53

Suspensionwhenfurtherinformationisneeded..............................................2.70

Sufficientinformationprovidedbyathirdparty..............................................2.90

LAofficialerror/Admindelaysubsidythreshholds..........................................2.100

Departmentalofficialerroroverpayments..........................................................2.110

IOWProcesses.....................................................................................................2.116

ClaimantsinreceiptofPensionCredit..............................................................2.130

Technicaloverpayments........................................................................................2.140

CTB-CTliabilityceases......................................................................................2.145

Rentrebate-rentalliabilityceases...................................................................2.146

OverpaymentsarisingfollowingthesuspensionofCTB.................................2.148

ExcessCTBarisingfromareductioninCTliability...............................................2.170

IndicativeRentLeveloverpayments.....................................................................2.171

Duplicateoverpayments........................................................................................2.180

Morethanoneoverpaymentcategory................................................................2.181

Isanoverpaymentrecoverable?................................................................................2.190

Wastheoverpaymentcausedbyamistake?.......................................................2.191

Didanyonecontributetothemistake?.................................................................2.194

Couldanyonereasonablyhavebeenexpectedtorealisetheywerebeingoverpaid?....................................................................................2.210

Whenshouldarecoverableoverpaymentberecovered?........................................2.230


Amdt3 September2010


2.00-2.03


Classifications of overpayments and subsidy

2.00 LocalAuthorities(LAs)receivesubsidyof100%forthegreaterpartofthequalifyingbenefitexpendituretheyincur.However,inareasofexpenditurewhereLAshavethemostscopetomonitorandcontrolcosts,lowerratesapply.OneareathatattractslowerratesofsubsidyisoverpaidHousingBenefit(HB)andexcessCouncilTaxBenefit(CTB).

2.01 It is important that each HB/CTB overpayment identified is classified and a record of itmaintainedsothecorrectrateofsubsidycanbeclaimedandinformeddecisionscanbemadeonrecoverability.

2.02 Thesubsidyarrangementsalsoact,atleastinpart,asanincentiveforLAstoclassifyandrecoveroverpaymentscorrectly.InmostcaseswhenoverpaymentsarerecoverableanLAmaykeepboththeamounttheyrecoverandthesubsidy.

Example 1

Claimantoverpaid(Claimanterror)3May2010to30May2010forfourweeks

@£50.00 =£200.00

LAclaimssubsidyof40%(Claimanterror) =£80.00

LArecovers =£200.00

LA allowed to keep £280.00

Example 2

Claimantoverpaid(Fraud)5July2010to18July2010fortwoweeks

@£40.00 =£80.00

LAclaimssubsidyof40%(Fraud) =£32.00

LArecovers =£80.00

LA allowed to keep £112.00

2.03 ItisimportanttorememberthatmostHB/CTBoverpaymentsareareaswhereLAsdonotreceive100%subsidyfromtheDepartmentforWorkandPensions(DWP).Overpaymentscanbecostlytorecover.Money lost throughreducedsubsidyandthecostsof recoveringoverpaymentscomesfromtheLAsoverallbudgetandthatmeanstherearefewerfundsavailableforotherservices.


September2010 Amdt3


2.04-2.10

2.04 Itisimportanttoensurethatinadditiontopreventingoverpaymentsoccurringeveryeffortismadetorecoverthem.

2.05-2.09

Overpayments subsidy table

2.10 Overpayment type Benefit type Subsidy rate

1. Eligible overpayments AllHB/CTB

• Fraud •40%

• Claimanterror •40%

• Other(alloverpaymentsthatdonotfallinto •40%anyoftheothercategories)

2. LA official error and Administrative(Admin) AllHB/CTBdelay overpayments

• totallevelofoverpaymentsdoesnotexceed •100%lowerthreshold

• totallevelofoverpaymentsisgreaterthan •40%lowerthresholdbutdoesnotexceedupperthreshold

• totallevelofoverpaymentsexceedsupper •Nilthreshold

3. Departmental official erroroverpayments AllHB/CTB 100%not recovered

4. Departmental official error overpayments AllHB/CTB Nilrecovered

5. Technical overpayments (benefit credited in RentRebateandCTB Niladvance of entitlement)

6. Excess Council Tax Benefit arising from the CTB Nilreduction ina claimant’s Council Tax liability

7. Indicative Rent Level (IRL) overpayments not RentAllowance 100%recovered (overpayments arising because an IRL exceeded the maximum rent payable)

8. IRL overpayments recovered (overpayments Rent Nilarising because an IRL exceeded the Allowancemaximum rent payable)


Amdt3 September2010


(2.10) Overpayment type Benefit type Subsidy rate

9. Duplicate overpayments UsuallyRentAllowance, 25% butcouldbeRent RebateorCTBifactual paymentmade

2.11-2.29

Explanations of the classifications2.30 Classifyinganoverpayment

• isanessentialbutbasicstepintheoverpaymentprocess,and

• shouldbecarriedoutattheoutsetwhenanoverpaymentisidentified

Eligible overpayments

Fraud overpayments

40% subsidy

2.31 Definition:Fraudoverpaymentmeansanoverpaymentinrespectofaperiodfallingwhollyorpartlyafter31March1993,whentheclaimanthas,inrespectoftheoverpayment

• beenfoundguiltyofanoffencewhetherunderstatuteorotherwise

• madeanadmissionaftercautionofdeceptionorfraudforthepurposeofobtainingrelevantbenefit,or

• agreedtopayapenaltyundersection115AoftheSSAAandtheagreementhasnotbeenwithdrawn

‘Admissionaftercaution’means

(i) inEnglandandWales,anadmissionafteracautionhasbeenadministeredinaccordancewithaCodeissuedunderthePoliceandCriminalEvidenceact1984

(ii)inScotland,anadmissionaftercautionhasbeenadministered,suchadmissionbeingdulywitnessedbytwopersons

HB Reg 102 & (Pension Credit) 83

2.32 ForsubsidypurposesthereisnoneedtorecordasFraudanyoverpaymentthatoccursbecauseofafraudulentclaim.Thisisbecausetheyarerecordedasaneligibleoverpaymentonthesubsidyclaimformandreceive40%subsidy.However,foroverpaymentrecoverypurposesitisimportantthateachoverpaymentisclassifiedaccordingly,ieFraud,Claimanterroror‘Other’.

(2.10)-2.32


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2.33-2.35

2.33 AnyHBoverpayment classifiedas Fraud canbe recoveredatahigher recovery rate.Also,overpaymentsclassifiedasFraudcanbetreateddifferently,forrecoverypurposes,whentheclaimantisinvolvedininsolvencyprocedures–seeCourts and civil proceedingslaterinthisguide.

2.34 ItmayalsobeusefulforManagementInformation(MI)purposestodifferentiatebetweenClaimanterror,Fraudand‘Other’overpayments.LAsshouldprioritisetherecoveryoftheirfraudulentoverpayments.

Claimant error overpayments

40% subsidy

2.35 Definition:Claimanterroroverpaymentmeansanoverpaymentwhich

a iscausedby

i theclaimant,or

ii apersonactingontheclaimant’sbehalf

- failingtoprovideinformationinaccordancewithHBRegs83(1)or86((PensionCredit)64(1)or67)orCTBRegs69(1)or72((PensionCredit)53(1)or57),or

- failingtoreportachangeofcircumstancesinaccordancewithHBReg88((PensionCredit)69)orCTBReg74((PensionCredit)59),and

b isnotafraudulentoverpayment

Example 1

Achangeoccursintheclaimant’searningson19January2010.Theclaimantfailstoreportthechangeuntil9February2010.TheLAactionsthechangeon10February2010.Theoverpaymentisclassifiedasfollows

25January2010–14February2010:Claimant error

Example 2

TheLAreceivesanHBMSscanon16February2010whichsaysthattheclaimant’sJSAclaimceasedon12January2010.On19March2010theLAsuspendstheHBandwritestotheclaimanttoaskfordetails,allowingonemonthtoreply.Noreplyisreceivedfromtheclaimant,andon19April2010theLAdecidestoterminatetheHBclaim.HBhadbeenpaidupto14March2010.Theoverpaymentisclassifiedasfollows

18January2010–14March2010:Claimant error

AlthoughtheLAknewaboutthechangefromtheHBMSscan,theclaimantstillhasadutyunderHBReg88tonotifytheLAofthechange.BecausetheclaimantdidnotnotifytheLAofthischange,theclaimanthascontributedtotheoverpayment,andthereforeitwouldbeclassifiedasClaimant error.

http://www.dwp.gov.uk/docs/hbopg-courts.pdf


Amdt3 September2010


2.36-2.39

Reporting change of circumstances to different departments in the LA

No details provided of where to report change of cicumstances

2.36 If an LA does not give details of where a claimant must report changes of circumstancesto (designated office), and just uses terms such as ‘us’, ‘council’ or ‘local authority’ in itscommunications,aclaimantmayreportachangeofcircumstancestoanydepartmentintheLA.Theywillhavesatisfiedtheirdutytoreportchangesofcircumstancesasprescribedbytheregulations.

2.37 AnyoverpaymentfromwhentheclaimantreportsthechangetotheLA(irrespectiveofwhichdepartmenttheclaimantreportsthechangeto)uptowhenthechangeofcircumstancesisprocessed,wouldbeclassifiedasLAofficialerrororAdmindelay(dependingonwhethertheoverpaymentwascausedbyadelayandwhetherthatdelaywascausedbyamistake).SeeLA official error and Admin delay overpaymentslaterinthissection

Details provided of where to report change of circumstances

2.38 IfanLAmakesitclearinitscommunicationsthataspecificdepartment/addressisthe‘designatedoffice’ towhicha claimantmust report changesof circumstances, then the claimantmustreportchangestothatdepartmentinordertosatisfytheregulations.Iftheclaimantreportsachangeofcircumstancestoadifferentdepartment,anyoverpaymentwouldbeclassifiedasClaimanterrorupuntilthe

• claimantnotifiesthedesignatedofficeofthechange,or

• LAstopstheoverpaymentfromcontinuing(suspendstheclaimorprocessesthechange)HB Reg 88 & (Pension Credit) 69; CTB Reg 74 & (Pension Credit) 59

‘Other’ overpayments

40% subsidy

2.39 Definition:‘Other’overpaymentmeansanyoverpaymentswhichdonotfitinanyoftheothercategories.Examplescouldbewhenan

• LAmakesapaymentingoodfaith,butachange,suchasanadversedecisioninajudicialreview,resultsinanoverpayment

• awardofbenefitdoesnot take intoaccountany income subsequentlypaidasarrears,forinstancewhenaclaimant’searningsincreaseretrospectivelyandtheyreceivealumpsumpaymentofarrears,orasaresultofentitlementtoanotherbenefitcommencingorincreasing


September2010 Amdt3


2.40 ClassifyoverpaymentsofHB/CTBcausedasa resultofbackdated incomeas ‘Other’, asnoofficialerrorhasbeenmade.However,iftherehasbeenadelayinprocessingabenefitanditisduetoamistakemadebytheDWP,theoverpaymentcanbeclassifiedasDepartmentalofficialerror.YouwouldneedtoliaisewiththeDWPtoestablishwhetherthedelaywasduetoamistake.

Example 1

AnemployedearnerwhoispaidmonthlyisentitledtoapayincreasefromApril,butthearrearsarenotpaiduntilNovember.

AstherewasentitlementtothepayincreasefromApril,takethearrearsofpayintoaccount for theperiodoverwhich theywouldhavebeen taken intoaccount if theincreaseinpayhadbeenpaidontime.

Calculatetheoverpaymentinthenormalway.Thisshouldbeclassifiedas‘Other’.

Example 2

MrsAisawardedISfromMonday8February2010andisgrantedmaximumHBasaresult.OnMonday22March2010MrsAreceivesanawardofCarersAllowance(CA),whichisbackdatedtoMonday25January2010andtheoveralleffectexceedsherISentitlement.

TheDWPterminateherISfrom8February2010andnotifytheLAofthisonthesameday.

The LA process the change of circumstances and calculate an overpayment from 8February2010to28March2010.Classifythisas‘Other’.

2.41-2.49

LA official error and Admin delay overpayments

100% Subsidy (less than or equal to the lower threshold)

40% Subsidy (more than the lower and up to and including the upper threshold)

Nil subsidy (more than the upper threshold)

2.50 Definition:LAofficialerroroverpaymentmeansanoverpaymentcausedbyamistake,whetherintheformofanactoromission,madebytheLAorsomeoneactingontheirbehalf.Theclaimant,apersonactingontheclaimant’sbehalf,orthepersontowhomthebenefitwaspaid,didnotcauseormateriallycontributetothatmistake,actoromission.

2.51 AnLAofficialerroroverpaymentisonlyrecoverablewhenthepersonaffectedcould,atthetimeofreceiptofthepayment,oranynoticerelatingtothatpayment,reasonablyhavebeenexpectedtorealisethatitwasanoverpayment.

HB Reg 100 & (Pension Credit) 81; CTB Reg 83 & (Pension Credit) 68

2.40-2.51


Amdt3 September2010


2.52 Definition:Admindelayoverpaymentmeansanoverpaymentarisingwhen

a anLAisnotifiedofachangeofcircumstancesandhassufficientinformationandevidencetomakearevisionorsupersessiondecision,and

b theLAdoesnotmakethedecisionbeforetheclaimant’snextpayday,and

c thedelaywasnotcausedbyamistake,whetherintheformofanactoromission,madebytheLA,and

d thedelaywasnotcausedormateriallycontributedtobytheclaimant,apersonactingontheclaimant’sbehalf,oranyotherpersontowhomthebenefitwaspaid

Which classification is appropriate?

2.53 Whenalltheinformationneededtoprocessachangeofcircumstancesthatwouldreduceaclaimant’sHB/CTBentitlementisreceived,theLAmustactionitbeforetheclaimant’snextpayday.Ifitisnotactionedbeforethenextpayday,anyoverpaymentfromthefirstdayofthebenefitweekfollowingreceiptofalloftheinformationshouldbeclassifiedasanLAofficialerrororanAdmindelay.

2.54 Ifthedelayinprocessingthechangeofcircumstanceswascausedbyamistake,forexampletheLAputthechangeofcircumstancesinformationtoonesideandforgottoprocessit,theoverpaymentshouldbeclassifiedasanLAofficialerror.

2.55 IfthedelayinprocessingthechangeofcircumstanceswasduetosomethingoutoftheLA’scontrol,forexamplestaffshortagesduetosickness,oriftheyhadprioritisedtheirworkload,buttheywereunabletoprocessitbecauseofabacklog,theLAmaydecidethattheoverpaymentshouldbeclassifiedasanAdmindelay.

2.56 IftheoverpaymentisclassifiedasanLAofficialerror,theLAmustthenmakeadecisiononwhetheritisrecoverable.Couldtheclaimantreasonablyhavebeenexpectedtorealisetheywerebeingoverpaidatthetimeoftheoverpaymentoranynoticesrelatingtothepaymentsofbenefitthatwereoverpaid?Iftheclaimantcouldn’t,theoverpaymentisnotrecoverable.

2.57 If theoverpayment is classifiedasanAdmindelay, theoverpayment is recoverable.This isbecausealloverpaymentsofHBandCTBarerecoverableexceptcertainofficialerrors.AstheLAhasmadeadecisionthattheoverpaymentwasnotcausedbyamistakeandisthereforenotanLAofficialerror,theoverpaymentisautomaticallyrecoverable.

2.58 An LA might decide an overpayment that was caused by a delay in processing should beclassifiedpartasAdmindelayandpartasLAofficialerror.Thismightbe,forexample,becausetheydecidethattheycouldnothaveprocessedthechangeofcircumstanceswithinacertainperiod,forexamplewithintwoweeksofreceivingalloftheinformation,giventheworkloadsontheirbenefitprocessingteamsandthereforethosetwoweeksoftheoverpaymentshouldbeclassifiedasAdmindelay.Theniftheoverpaymentcontinuedbeyondthosetwoweekstheymightdecidethatfromthatpointonwardsthedelaywasduetoamistake,thatis,therewasanerrorinthattheyomittedtoprocessthechangewheninfacttheycouldhave.TheoverpaymentshouldthereforebeclassifiedasanLAofficialerrorfromthatpoint.

2.52-2.58


September2010 Amdt3


2.59 ThedecisionastowhethertheoverpaymentisanLAofficialerrororAdmindelaymustbemadebytheLAbasedontheindividualcircumstancesofeachcase.Iftheclaimantappealsagainsttheoverpaymentdecision,forexampletheLAhasclassifiedtheoverpaymentasanAdmindelayandtheclaimantthinksthatitwascausedbyanofficialerror,theLAmustbeabletojustifytheirdecision.ItshouldalsobenotedthatiftheLA’sdecisionisthattheoverpaymentisrecoverablebecauseitisnotanofficialerror,atribunaloracourtmighttakeadifferentview.Thereshouldthereforebearecordofthedecision,outliningwhythedelayinprocessingthechangeofcircumstanceswasnotcausedbyamistakemadebytheLA.

Example 1

Whilstreviewingacaseon20October2010theLAnoticesthatthewageshavebeenincorrectlyassessedsincetheclaimwasawardedfrom8February2010.ThereasonforthisisthattheLAhasincorrectlycalculatedthewages.Theclaimanthasnotcontributedtotheerrorinanyway.

TheLArevisestheclaim,creatinganoverpaymentof£10aweek.

TheLAclassifiestheoverpaymentasLAofficialerrorbecauseitwascausedbyamistake.

Example 2

On 16 February 2010 the claimant informs the LA that their contracted hours haveincreased,whichwilltakeeffectfrom8February2010.Fullevidenceisprovided.

Theclaimant’snextpaydayis1March2010,inrespectoftheperiod1February2010to28February2010.

AstheLAhasabacklog,duetostaffsickness,thechangeisnotprocesseduntil4March2010causinganoverpaymentfortheperiod8February2010to28February2010.

TheLAclassifiestheoverpaymentasfollows:

8February2010to21February2010 Claimanterror

22February2010to28February2010 Admindelay

TheLAclassifiespartoftheoverpaymentasAdmindelaybecausetheydonotthinkthedelayinprocessingthechangeofcircumstanceswascausedbyamistake.

2.60-2.69

Suspension when further information is needed

2.70 Regulation11oftheHBandCTB(DecisionandAppeals)Regulations2001statesthatanLAmaysuspendHBorCTB,inwholeorinpart,ifthereisanissueregardingtheconditionsofentitlementonaclaimoriftheLAsuspectsanoverpaymentisoccurring.Astheword‘may’isused,thismeansthedecisiontosuspendisdiscretionary.Thereforeifanoverpaymentoccurs,itisnotnecessarilyanLAofficialiftheLAhasnotsuspendedbenefit.However,thisdoesnotmeanitisneveranLAofficialerroriftheLAhasnotsuspended.

2.59-2.70


Amdt3 September2010


2.71 The LA will have to decide the classification of the overpayment based on the individualcircumstancesofeachcase.Thedecidingfactorsare

• hastheLAmadeamistake,whetherintheformofanactoromission?

• hastheclaimant,personactingontheirbehalforthepersontowhomthebenefitwaspaid,causedorcontributedtothatmistake,actoromission?

2.72 Inacasewheretheclaimantreportsachangeofcircumstances,butdoesnotprovidesufficientinformationandtheLAhasnotsuspendedbenefit,adecisionwillhavetobemadeonwhethertheLAwerejustifiedinnotsuspendingthebenefitandwhethertheclaimanthascontributedto the overpayment. The classification of the overpayment will also depend on how longbenefitispaidwhentheLAareawarethatthereareissuesaroundconditionsofentitlementorasuspectedoverpayment.TheLAshouldnotpaybenefitindefinitelywhilstawaitingfurtherinformationfromtheclaimant.

Example

TheclaimantwritestotheLAtellingthemthedatetheyhavestartedwork.TheydonotgivetheLAanyotherinformationandtheydonotsaywhethertheywanttocontinueclaimingHB.TheLAconsidersanExtendedPaymentbut,astheclaimanthasnotbeeninreceiptofaqualifyingbenefitfor26weeks,theyarenoteligible.TheLAdecidestocontinuepayingHBwhilsttheygatherfurtherinformation,becausetheydecide,basedonthecircumstancesofthisparticularcase,thattheclaimantmayfacehardship.

They write out to the claimant, requesting information and evidence of their newcircumstances,includingdetailsoftheirearnings,inordertocalculatein-workHB.Theygivetheclaimantonemonthinwhichtorespond.Attheendofthemonththeclaimanthasnotreplied.

TheLAdoesnotsuspendbenefitandwritesouttotheclaimantagain,givingthemafurthermonth.Againtheclaimantdoesnotreply.AtthispointtheLAsuspendstheclaim,writesouttotheclaimantagain,tellingthemthatiftheydonotrespondwithinonemonth,theirclaimforbenefitwillbeterminated.Theclaimantdoesnotrespond,sotheclaimisterminatedfromtheMondayfollowingthedatetheclaimantstatedtheyhadstartedwork.IntheLA’sview,theclaimanthas(orcouldacquire)theinformationrequested,butwithholds it.TheLA,therefore,drawsanadverseinferencefromtheclaimant’sfailuretorespondandholdsthattheworkissuch,astoendentitlementtoHBfromthedatetheclaimantstatedtheyhadstartedwork.Theawardissupersededonthisbasis.

2.73 Theoverpayment in theexampleabovewouldbeclassifiedasClaimanterror for thefirstmonthandthenLAofficialerrorforthesecondmonth.TheLAcouldjustifytheirdecisiontocontinuepayingbenefitforthefirstmonth,inorderforhardshipnottobecaused.AlsoitcouldbearguedthattheclaimantdidnotprovidesufficientinformationfortheLAtobeabletoprocessthechangeofcircumstances,soitwouldbeacceptabletoclassifythefirstmonthoftheoverpaymentasClaimanterror.

2.71-2.73


September2010 Amdt3


2.74 However,aftertheclaimantdidnotrespondtothefirstrequestforinformationandevidence,theLAshouldhavesuspendedbenefitastheyknewtheclaimanthadstartedworkandtherewereissuesaroundconditionsofentitlement.TheydidnotknowwhethertheclaimantwantedtocontinueclaimingHB.Thesecondmonths’overpaymentshouldthereforebeclassifiedasLAofficialerror.(Iftheoverpaymentwascausedbyadelayinprocessing,whichtheLAdecidedwasnotcausedbyamistake,whetherintheformofanactoromission,someoftheoverpaymentcouldhavebeenclassifiedasAdministrativedelay.)

2.75 Remember thatyoumustapply thenormal rulesonclassifyingoverpayments, iewhenanoverpaymentchanges fromoneclassification toanother, the subsequentclassificationwillstartfromtheMondayfollowingthereasontheclassificationisbeingchanged.

Example

TheLAreceivesanETDfromtheDWPstatingthataclaimanthasceasedreceivingJSA(IB)becausetheyhavestartedwork.TheclaimantdoesnotcontacttheLA.TheLAconsidersanExtendedPaymentbut,astheclaimanthasnotbeeninreceiptofaqualifyingbenefitfor26weeks,theyarenoteligible.TheLAdecidestocontinuepayingHBwhilsttheygatherfurther information,becausetheydecide,basedonthecircumstancesofthisparticularcase,thattheclaimantmayfacehardship.

They write out to the claimant, requesting information and evidence of their newcircumstances,includingdetailsoftheirearnings,inordertocalculatein-workHB.Theygivetheclaimantonemonthinwhichtorespond.Attheendofthemonththeclaimanthasnotreplied.

TheLAdoesnotsuspendbenefitandwritesouttotheclaimantagain,givingthemafurthermonth.Againtheclaimantdoesnotreply.AtthispointtheLAsuspendstheclaim,writesouttotheclaimantagain,tellingthemthatiftheydonotrespondwithinonemonth,theirclaimforbenefitwillbeterminated.Theclaimantdoesnotrespond,sotheclaimisterminatedfromthedateJSA(IB)ceased.IntheLA’sview,theclaimanthas(orcouldacquire)theinformationrequested,butwithholdsit.TheLA,therefore,drawsanadverseinferencefromtheclaimant’sfailuretorespondandholdsthattheworkissuchastoendentitlementtoHBfromthedateJSA(IB)ceased.Theawardissupersededonthisbasis.

2.76 ThefulloverpaymentintheexampleabovewouldbeclassifiedasClaimanterrorbecausetheclaimantdidnotinformtheLAthattheyhadstartedwork,whichtheyhaveadutytodounderHBRegulation88.Theclaimantthereforecontributedtotheoverpayment.Anoverpaymentcannotbeclassifiedasanofficialerroriftheclaimanthascontributedtoit.

2.77 AnLAshouldnothaveablanketpolicyofalwayssuspendingorneversuspendingbenefit.Eachcaseshouldbeconsideredonitsownmeritsandadecisiontosuspendshouldbebasedontheparticularcircumstancesofthatcase.TheLAmustconsiderthewelfareoftheclaimant,forexamplewhethertheywillfacehardshipiftheirbenefitissuspended.HowevertheLAmustalsomanagetheiroverpaymentdebt,anddoeverythingtheycantokeepittoaminimum.

2.78-2.89

2.74-2.89


Amdt3 September2010


Sufficient information provided by a third party

2.90 IftheLAhassufficientinformationforthemtobeabletoprocessachangeofcircumstances,irrespectiveofwherethatinformationhascomefrom,anyoverpaymentfromtheMondayfollowingreceiptofthatinformationwouldbeclassifiedasLAofficialerrororAdmindelay,dependingonwhetherthedelayinprocessingwascausedbyamistake.FromthepointthattheLAhassufficientinformation,theclaimantisnolongercontributingtothemistake.Thisisbecausenothingfurtherisneededfromtheclaimant.

2.91 Ifthethirdpartydoesn’tprovidesufficientinformation,forexamplewhentheLAreceivesanETDfromtheDWPstatingtheclaimanthasstartedwork,furtherinformationwouldbeneededfromtheclaimantandthereforetheoverpaymentwouldcontinuetobeclassifiedasClaimanterrorupuntiltheinformationisreceivedortheclaimissuspended.

2.92 Thisisbecausetheclaimanthasnot

• satisfiedtheirlegaldutytonotifychangesofcircumstancesthattheymightreasonablybeexpectedtoknowmightaffecttheirbenefitentitlement

HB Reg 88 & (Pension Credit) 69;CTB Reg 74 & (Pension Credit) 59

• providedtheevidenceandinformationneededtoprocessanyquestionsarisingoutoftheclaim


Theclaimantisthereforecontributingtotheoverpayment.

2.93-2.99

LA official error/Admin delay subsidy thresholds

2.100 IfanLAofficialerrororAdmindelayoverpaymentoccurs,therearedifferentratesofsubsidythatcanbeclaimed.TheseratesdependonwhetherthetotalamountofLAofficialerrorandAdmindelayoverpaymentsexceedacertainthreshold.

2.101 Currentlythethresholdsexpressedasapercentageoftotalcorrectpaymentsare

• Lowerthreshold 0.48%

• Upperthreshold 0.54%

2.102 Correctpayments(knownas‘totalspecifiedpayments’intheSubsidyOrder)aredefinedaspaymentsforwhichfull(100%)subsidyispayable.Thisincludes

• RentRebates

• non-HRARentRebates

• RentAllowancesandCTB,andincorporates

• anybackdatingthathasbeenproperlyundertaken

2.90-2.102


September2010 Amdt3


2.103 IfthetotalvalueofLAofficialerrorandAdmindelayoverpayments

• donotexceedthelowerthreshold,100%subsidyispayableforalloftheLAofficialerrorandAdmindelayoverpayments

• aregreaterthanthelowerthreshold,butdonotexceedtheupperthreshold,40%subsidyispayableforalloftheLAofficialerrorandAdmindelayoverpayments

• exceedtheupperthreshold,LAsreceivenilsubsidyfortheirLAofficialerrorandAdmindelayoverpayments

Example

TheLA’stotalcorrectpaymentsforthefinancialyearis£34,475,000.

• IfthetotalvalueofLAofficialerrorandAdmindelayoverpaymentsisbelow£165,480theLA can claim100%subsidyonallof their LAofficial errorandAdmindelayoverpayments.

• If the total valueof LAofficial errorandAdmindelayoverpayments isbetween£165,481and£186,165inclusively,theLAcanclaim40%subsidyonalloftheirLAofficialerrorandAdmindelayoverpayments.

• If the total value of LA official error and Admin delay overpayments exceeds£186,165theLAcannotclaimanysubsidyfortheirLAofficialerrorandAdmindelayoverpayments.

2.104 ThesethresholdscouldbereducedinsubsequentyearsinordertograduallyprovidefurtherincentivesforLAstotacklelevelsofLAofficialerrorandAdmindelayoverpayments.

2.105-2.109

Departmental official error overpayments

100% subsidy

Nil subsidy for recovered Departmental official error overpayments

2.110 Definition:Departmentalofficialerrormeansanoverpaymentwhicharisesfromamistake,whetherintheformofanactoromission,madebyanofficerof

• theDWP

• theCommissionersofHerMajesty’sRevenueandCustoms(HMRC)

• apersonactingforanyoftheaboveHB Reg 100 & (Pension Credit) 81; CTB Reg 83 & (Pension Credit) 68

2.111 Thisclassificationisnotappropriatewhenthepersonaffectedcausedormateriallycontributedtothemistake,actoromission.

2.103-2.111


Amdt3 September2010


2.112 ADepartmentalofficialerroroverpaymentisonlyrecoverablewhenthepersonaffectedcould,atthetimeofreceiptofthepaymentoranynoticerelatingtothatpayment,reasonablyhavebeenexpectedtorealisethatitwasanoverpayment.

2.113 RecoveredDepartmentalofficialerroroverpayments,oranypartofaDepartmentalofficialerroroverpaymentwhichisrecovered,arenoteligibleforsubsidy.

2.114 ItisnotnecessarilyaDepartmentalofficialerroriftheDWPfailstopassinformationontoLAsregardingchangesintheclaimant’scircumstances.ThisisbecausetheclaimanthasadutytoreportanychangesthatmayaffecttheirentitlementtoHBorCTBtotheLAthatadministerstheirbenefit.EvenifaclaimanthasnotifiedtheDWPofachange,theystillhaveadutytoreportittotheLA.AnoverpaymentarisingaftertheDWPhasnotifiedtheLAmaybeclassifiedasLAofficialerrororAdmindelay,becauseoncetheLAisawareofachangetheyareexpectedtoactonit.However,thiswillalldependontheinformationthatissentbytheDWP.Iffurtherinformationisstillneededfromtheclaimant,theyarestillcontributingtotheoverpaymentandthereforetheoverpaymentwouldbeclassifiedasClaimanterror.

2.115 TherearehoweverexceptionstotheregulationsthatstipulatethataclaimantmustnotifytheLAofachangeofcircumstances,egInandOutofWork(IOW)ProcessesandclaimantsinreceiptofPensionCredit.

IOW Processes

2.116 TheHBandCTBregulationshavebeenamended,sothatincertaincircumstances,claimantscandischargetheirdutyofreportingtheyhavestartedworktotheLAbyreportingittotheappropriateDWPoffice,(ifatelephonenumberhasbeenprovidedforthatpurpose).


2.117 WhentheclaimanttelephonestheDWPtonotifyamoveintowork,theDWPwillconductaninterviewandsimultaneouslycompleteanintoworkstatement,formIWK4.TheDWPwilladvisetheclaimantabouttheevidencetheyneedtosendtotheLAandconfirmtherequestforevidencehasbeenmadeontheIWK4.OncethetelephonecalliscompletedtheIWK4issentimmediatelytotheLAbysecureemail.

2.118 IftheIWK4doesn’tarriveattheLAorthereisadelayintheIWK4arrivingattheLA,butthereisarecordoftheclaimantreportingtheyhavestartedworkusingtheIOWprocessesandtheclaimanthasprovided sufficient information toenable theLA toprocess the change,anyoverpaymentwouldbeclassifiedasDepartmentalofficialerrorfromtheMondayfollowingtheclaimantnotifying theDWP.This isbecause theclaimanthas satisfied their legaldutyofreportingthechangeofcircumstancestotheappropriateofficeandprovidingsufficientinformationandevidence.

2.112-2.118


September2010 Amdt3


2.119 Ifhowever, the claimanthasnotprovided sufficient information, theoverpaymentwouldcontinuetobeclassifiedasClaimanterroruntiltheclaimanthasprovidedtheinformationandevidence.Thisisbecausetheclaimantiscontributingtotheoverpaymentbynotprovidingsufficientinformationandevidenceandanoverpaymentcannotbeclassifiedasofficialerroriftheclaimanthascontributedtoit.

Example

ClaimantreceivingJobseeker’sAllowance(JSA)telephonesthenumberpublishedbytheDWPtoreporttheyhavestartedwork.

TheyconfirmtheynolongerwishtoclaimHBandCTBbecausetheamountoftheirearningsistoohigh.

TheDWPfailstosendtheIWK4totheLAandtheLAthereforecontinuestopayHBandCTBforafurtherthreeweeks.

TheoverpaymentshouldbeclassifiedasDepartmentalofficialerrorbecauseitwascausedbyamistakemadebytheDWP,whichtheclaimantdidnotcontributeto.

2.120-2.129

Claimants in receipt of Pension Credit

2.130 TherearecertainchangesofcircumstancesthataclaimantwhoisalsoinreceiptofPensionCreditcanreporttotheDWPandbydoingso,havesatisfiedtheirdutyofreportingthechangetotheLA.Inthesecases,theLAisreliantonreceivingtheinformationfromtheDWP.

2.131 IfapensionerreportsachangeofcircumstancesontimetotheDWP,andthatchangereducestheirPensionCredit,whichthenreducestheirentitlementtoHBand/orCTB,theLAwouldonlytakethechangeintoaccountfromtheMondayfollowingreceiptoftheinformationfromtheDWP(normallyreceiptofanElectronicTransferofData(ETD))orthedatethePensionCreditreduces,whicheveristhelater.

2.132 IfapensionerdelaysinreportingachangeofcircumstancestotheDWP,andthatchangereducestheirentitlementtoPensionCredit,whichthenreducestheirentitlementtoHBand/orCTB,theLAwouldtakethechangeintoaccountfromtheMondayofthebenefitweekfromwhichthePensionCreditreduced.TheoverpaymentwouldbeclassifiedasClaimanterrorfromthedateofchangetotheendofthebenefitweekinwhichthechangewasnotifiedtotheDWP.ItwouldthenbeclassifiedasDepartmentalofficialerrorfromthefollowingMondayuntiltheendofthebenefitweekinwhichtheDWPsendstheinformationtotheLA.

2.133 IfapensionerhasachangeofcircumstancesthatincreasesentitlementtoPensionCredit,whichthenreducestheirentitlementtoHBorCTB,theLAwouldtakethechangeintoaccountfromtheMondayfollowingreceiptoftheinformationfromtheDWP(normallyreceiptofanETD)orthedatePensionCreditincreases,whicheveristhelater.ItdoesnotmatterifthepensionerdelayedinreportingthechangetotheDWP.

HB (Pension Credit) Reg 60; CTB (Pension Credit) Reg 51

2.119-2.133


Amdt3 September2010


(2.133) Example

AclaimantinreceiptofPensionCredithasanincreasetotheiroccupationalpensionon5January2010.

TheyreportittotheDWPon27January2010.

The DWP recalculates the Pension Credit and sends an ETD to the LA on 10February2010,showingthatPensionCreditdecreasedfrom11January2010.

The LA calculates an overpayment, which is classified as Claimant error from 11January2010to31January2010.

It is then classified as Departmental official error from 1 February 2010 to 14February2010.

2.134 Incasesofdoubt,liaisewiththerelevantDWPofficetoestablishiftheDWPhasmadeamistakeandthereforecausedtheoverpayment.IfyouidentifyanerrorcausedbytheDWP,telltheappropriateDWPofficeassoonaspossible.ItisstilltheLA’sresponsibilitytotakeactiononanyHB/CTBoverpaymentclassifiedasaDepartmentalofficialerror.

2.135-2.139

Technical overpayments

Nil subsidy

2.140 Definition:TechnicaloverpaymentmeansanoverpaymentwhenrentrebateorCTBiscreditedin advance of entitlement for a particular period, where a change of circumstances or arecoverableoverpaymentcausesthatentitlementtoberemovedorreduced.

2.141 AnyrentrebateorCTBoverpaymentthatstartsorcontinuesfromthebenefitweekfollowingtheweekinwhichthechangeisdisclosedtotheLAorinwhichtheLAidentifiesthechange,isaTechnicaloverpayment.

2.142 However,theclassificationsofLAofficialerrorandAdmindelaytakepriorityovertheTechnicaloverpaymentclassification.ThisisbecauseLAofficialerrorsandAdmindelaysaregenuineoverpaymentsonwhichadecisiononrecoverabilityisrequired,whereasTechnicaloverpaymentsarejustadjustmentstotherentorCouncilTax(CT)account.ThebenefitcreditedfortheperiodoftheTechnicaloverpaymentcanbetakenbackoutoftherentorCTaccount.Forexample,ifaclaimantreportsachangeandtheLAmakesamistakeordelaysinprocessingthechange,whichresultsinCTBorrentrebatebeingcreditedagainsttheclaimant’saccountforalongerperiodthanshouldhavebeen,thiswouldbeanLAofficialerrororAdmindelayoverpaymentandnotaTechnicaloverpayment.

(2.133)-2.142


September2010 Amdt3


2.143 AnexampleofaTechnicaloverpaymentiswhenCTBiscalculatedforthefullfinancialyearandiscreditedtotheCTaccount.IfachangeofcircumstancesoccursthataffectstheamountofCTBtheclaimantisentitledto,aTechnicaloverpaymentwouldhaveoccurredforthefutureperiodthathasalreadybeencredited.AsCTBisadailybenefit,calculateaTechnicaloverpaymentfromthedaythechangeisprocessedbytheLA,totheendofthefinancialyear.Therewillnotactuallyhavebeenanybenefitpaidout;itwilljusthavebeenacredittotheCTaccount.TherewillnotbeanymoneytorecoverfromtheclaimantfromthedaytheLAprocessesthechangeandthereforestopstheoverpaymentfromcontinuing.ItispurelyapaperexercisethatisdealtwithbytheCTaccountssystem.

Example

MrXclaimedCTBon5April2010andiscreditedwithafullrebatethroughtotheendofthefollowingMarch.

Hisincomeincreases,andheisnolongerentitledtoCTBfrom21June2010.

HenotifiesthechangetotheLAon6July2010,andtheyreassesshisclaimfrom22July2010,whentheCTBisterminated.

ThereisanoverpaymentofCTBfrom21June2010to31March2011.

TheyclassifytheexcessCTBasfollows

21June2010to11July2010 = Claimanterroroverpayment

12July2010to21July2010 = LAofficialerror/Admindelayoverpayment

22July2010to31March2011 = Technicaloverpayment

2.144 TheTechnicaloverpaymentclassificationshouldalsobeusedwheneitherCTliabilityceasesinaCTBcaseortherentalliabilityceasesinarentrebatecase.ThisisbecauseCTBispaidbyreducingtheCTliabilityandrentrebateispaidbyreducingtherentalliability.IftheCTandrentalliabilityhaveceased,thereisnothingtoreduceandthereforethereisnothingtorecoverfromthecustomer.TheCTBandrentrebatethathasbeencreditedaftertheliabilityceasedcanbetakenbackoutoftheCTandrentaccounts.SubsidyisnotpayableforCTBorrentrebatecreditedafterliabilityhasceased.

Section 134 and Section 138 SSAA1992

CTB – CT liability ceases

2.145 CTBTechnicaloverpaymentscanoccurwhencounciltaxliabilityhasended,butbenefithasbeenpostedtotheaccountforaperiodaftertheendofliability.Thiscouldbebecausetheclaimanthas

• moved,or

• died

Note:ExcessCTBcausedbytheclaimant’sCTliabilityceasingshouldalwaysbeclassifiedasaTechnicaloverpayment.Fortheperiodtherewasn’taCTliability,thereisn’tanythingtorecoverfromtheclaimant.TheCTBcreditedtotheCTaccountfortheperiodaftertheliabilityceasedcanbetakenbackoutoftheCTaccount.Thereisn’tanysubsidypayableforthisperiod.

2.143-2.145


Amdt3 September2010


(2.145) Example

MrXclaimedCTBon5April2010andiscreditedwithafullrebatethroughtotheendofthefollowingMarch.

MrXvacatesthepropertyandhisliabilitytopayCouncilTaxcomestoanendonTuesday13July2010.

HenotifiesthechangetotheLAonFriday23July2010andtheLAprocessesthechangeonFriday6August2010.

TherecanbenooverpaymentofCTBastheclaimantwasnolongerliabletopayCouncilTax.

ForrecordingpurposestheexcessCTBisclassifiedasfollows

13July2010to31March2011 = TechnicalOverpayment

Rent Rebate – rental liability ceases

2.146 HB technical overpayments can only occur in rent rebate cases. As with CTB technicaloverpaymentsthisisduetoliabilityendingandbenefitbeingpostedtotheterminatedrentaccount.Thisisoftenduetoboththeclaimantandhousingdepartmentfailingtonotifythebenefitsection.

Example

MrsCclaimedHBon4January2010.

MrsCvacateshercouncilpropertyandmovesoutoftheLA’sareaon12August2010.

Thehousingdepartmentclosesherrentaccountandthereforeceasesherrentalliabilityfrom23August2010.

MrsCnotifiesthebenefitsectionofthechangeon26August2010,andtheyreassesstheclaimfrom30August2010.

ThereisanoverpaymentofHBfrom16August2010to29August2010

TheHBoverpaymentisclassifiedasfollows

16August2010to22August2010 = Claimanterroroverpayment

23August2010to29August2010 = Technicaloverpayment

(2.145)-2.146


September2010 Amdt3


2.147 TheTechnicaloverpaymentclassificationcanbeappliedretrospectivelyiftherentalliabilityisterminatedretrospectively.Themostcommonreasonforthisiswhenaclaimantdiesormovesoutofacouncilpropertyandacloserelativetakesoverthetenancy.

Example

MrBdieson7July2010andtheHBsectionisinformedon29July2010.

TheHBclaimisterminatedfrom12July2010,whichleadstoanoverpaymentofHBfrom12July2010to1August2010,whichtheyclassifyasOther.

MrsBlaterappliesforandisgiventhetenancyforthepropertybacktothe19July2010.SheclaimsHBanditisbackdatedtothebeginningofthetenancy(19July2010).

AsMrsBtookoverthetenancyfromthe19July2010,thehousingdepartmentterminatesMrB’stenancyfrom19July2010.

TheHBsectioncanthereforetaketherentrebatecreditedtoMrB’srentaccountbackoutoftheaccountfromthe19July2010.

Theoverpaymentisclassifiedasfollows

12July2010to18July2010 = Other/Claimanterror

19July2010to1August2010 = Technicaloverpayment

Overpayments arising following the suspension of CTB

2.148 ConsidersuspendingCTBifa

• doubtaboutaperson’sCTBentitlementarises,or

• claimantfailstoprovidenecessaryinformationthatyouhaverequested

2.149 Aswithallcasesofpossiblebenefitsuspension,suchactionisnotmandatoryasithasalwaysbeenanimportantprinciplethatDecisionMakersconsidereachcaseonitsmerits.

2.150 If you decide to suspend CTB in a given case, the immediate impact of this differs fromsuspensionsinotherbenefits(includingHB)givenCTBworksbyrebatingtherelevantannualamountofCouncilTaxduefromtheclaimantatthestartoftheiraward.BecausepaymentsofCTBarenotphysicallyongoingduringtheyeartheyarenotsuspendedinthesenseofpaymentsbeingactuallystopped.

2.151 Therefore,suspensionofCTBhasnomaterialimpactoneithertheauthorityortheclaimantduringthesuspensionperiod,otherthanissueandreceiptofthenotificationletter.

2.152 Suspensionisatransitoryeventdesignedto

• encouragetheclaimanttoco-operate,or

• enabletheawardtobeterminated

2.147-2.152


Amdt3 September2010


2.153 Ifthesuspensionisduetoafailuretosupplyinformation,itendswhen

• theinformationisprovided,or

• CTBisterminatedundertheprovisionsintheHBandCTB(DecisionsandAppeals)Regulations2001,Regulation14

2.154 Ifthesuspensionisduetoadoubtaboutentitlement,itendswitheither

• continuationofthedecision

• revisionofthedecision

• supersessionofthedecision

Note:Suspensionisneveranendinitself.

2.155 FromthedatethatCTBissuspended,benefitisnotoverpaid.However,asCTBiscrediteduptotheendofthefinancialyear,calculateanyoverpaymentupuntiltheendoftheyear.Fromthedateofsuspension,anyoverpaymentisclassifiedasaTechnicaloverpayment.Thismeanstherehasn’tactuallybeenanybenefitoverpaid–itismerelyanaccountingmatter.SomeLAsrefertotheseas‘paper’overpayments.

Example

AclaimanthasbeenentitledtofullCTBfrom1April2010,worth£1,200(or£100permonth).Thisfullamountisrebatedatthestartofthefinancialyear.

OnTuesday3August2010,theLAlearnsthattheclaimanthasstartedahigherpaidjob.TheysuspendCTBbysimplynotingtheirsystemandwritingtotheclaimant

• advisingthemofthesuspension

• tellingthemarevisedCouncilTaxbillwillnotbeissuedduringthedurationofthesuspension

• requestingdetailsoftheirnewemploymentandearnings

Theclaimantreplieson1September2010totheeffectthattheirnewjobbeganonWednesday,30June2010.ItisclearthattheirnewearningsaresufficienttoniltheirCTBentitlementandtheoriginaldecisionissuperseded.

Inthiscase,CTBentitlementendedonSunday,4July2010–justoveramonthbeforethesuspension.TheLAwritestotheclaimanttoadvisethemofthisandthatarevisedCouncilTaxbillwillbeissued.TheLAissuesaCouncilTaxdemandfor£900fortheperiod5July2010to31March2011.

continued

2.153-2.155


September2010 Amdt3


(2.155) Theoverpaymentisclassifiedasfollows

5July2010to2August2010 = Claimanterror

3August2010to31March2011 = Technicaloverpayment

TheLAnotifiestheclaimantoftheClaimanterrorpartoftheoverpayment,satisfyingSchedule8requirementsandgivingtheappropriateappealrights.

2.156-2.169

Excess CTB arising from a reduction in CT liability

Nil subsidy

2.170 Definition:ExcessCTBmeansanoverpaymentthatarisesfromthereductioninaclaimant’sCTliability,egadelayedawardoftransitionalrelief,areductioninaproperty’sbandingfollowinganappealoralateawardofdiscount.SubsidycannotbeclaimedforreductionsinCTliability.Thereisn’tanythingtorecoverfromtheclaimant.ItisjustanadjustmenttotheCTaccount.

Indicative Rent Level overpayments

100% subsidy

Nil subsidy for recovered Indicative Rent Level overpayments

2.171 Definition:IndicativeRentLevel(IRL)overpaymentmeansanoverpaymentwhicharisesasaresultofbenefitbeingpaidusingIRLfigures,whichexceedsthemaximumrentpayable.

2.172 IfanIRLfigureisusedwhendecidingtheamountofpaymentonaccount,andarentofficer’sdecisionresultsinlesseligiblerentthantheIRL,LAsshouldrecovertheexcesspaymentonaccountfromongoingbenefit.

2.173 RecoveredIRLoverpaymentsoranypartofanIRLoverpayment,whichisrecovered,arenoteligibleforsubsidy.

2.174-2.179

Duplicate overpayments

25% Subsidy

2.180 Definition:Duplicateoverpaymentmeansanyoverpaymentarisingfromaduplicatepaymentfollowingallegednon-receipt,loss,theft,ordestructionincaseswheretheoriginalpaymenthasbeencashed.

(2.155)-2.180


Amdt3 September2010


More than one overpayment classification

2.181 Anoverpaymentmayhavemorethanoneclassification.Forexample,anoverpaymentcausedinitiallybyaclaimantfailingtoreportachangeofcircumstancesmaybeprolongedifthereisadelaybytheLAinactioningthechangeonceitisfinallyreported.ThepartoftheoverpaymentattributabletotheclaimantfailingtoreportachangeshouldbeclassifiedasClaimanterrorandtheremainingpartoftheoverpaymentshouldbeLAofficialerrororAdmindelay.

2.182-2.189

Is an overpayment recoverable?2.190 Therearethreequestions,whichmustbeconsideredinordertodecidewhetheranoverpayment

isrecoverable.Theyare

• Wastheoverpaymentcausedbyamistake,whetherintheformofanactoromission,bytheLA,DWP,HMRCorapersonactingontheirbehalf?

• Didtheclaimant,apersonactingontheirbehalforthepersontowhomthebenefitwaspaid,causeormateriallycontributetothemistake,actoromission?

• Couldtheclaimant,apersonactingontheirbehalforthepersontowhomthebenefitwaspaid,reasonablyhavebeenexpectedtorealisetheywerebeingoverpaid,eitheratthetimeoftheofficialerroroverpaymentoranynoticerelatingtothepaymentsthatweremade?


Note:Thequestionofwhetheranoverpaymentisrecoverableisseparatefromthequestionofwhethertorecoverit.

Was the overpayment caused by a mistake?

2.191 Wastheoverpaymentcausedbyamistake,whetherintheformofanactoromission,bytheLA,DWP,HMRCorapersonactingontheirbehalf?

2.192 Iftheanswertothisquestionisno,thentheHBorCTBoverpaymentislegallyrecoverable.Theoverpaymentshouldnotbeclassifiedasanofficialerror.However,justbecauseanoverpaymentisrecoverabledoesnotmeanthatitmustberecovered.

2.193 Iftheanswertothisquestionisyes,youmustgoontoconsiderthenextquestion.

Did anyone contribute to the mistake?

2.194 Didtheclaimant,apersonactingontheirbehalforthepersontowhomthebenefitwaspaid,causeormateriallycontributetothemistake,actoromission?

2.181-2.194


September2010 Amdt3


2.195 Iftheanswertothisquestionisyes,thentheHBorCTBoverpaymentislegallyrecoverable.Theoverpaymentshouldnotbeclassifiedasanofficialerror.However,justbecauseanoverpaymentisrecoverabledoesnotmeanthatitmustberecovered.

2.196 Iftheanswertothisquestionisno,theHBorCTBoverpaymentshouldbeclassifiedasanofficialerror.Youmustgoontoconsiderthenextquestion.

2.197-2.209

Could anyone reasonably have been expected to realise they were being overpaid?

2.210 Couldtheclaimant,apersonactingontheirbehalforthepersontowhomthebenefitwaspaid,reasonablyhavebeenexpectedtorealisetheywerebeingoverpaid,eitheratthetimeoftheofficialerroroverpaymentoranynoticerelatingtothepaymentsthatweremade?

2.211 Iftheanswertothisquestionisyes,thentheHBorCTBoverpaymentislegallyrecoverable.

2.212 Iftheanswertothisquestionisno,thentheoverpaymentisnon-recoverable.Itmustbewrittenoff.

2.213 However,thiscanbeadifficultdecisiontomake.Thereareanumberoffurtherissuesthatmustbeconsidered,suchas,didthepeopleaffected

• receivethedecisionnotices?

• readthedecisionnotices?

• knowwhichchangesofcircumstancesmustbereportedtotheLA?

2.214 Also,couldthepeopleaffectedreasonablyhave

• knownanoverpaymenthadoccurred,fromtheinformationprovidedbytheLA?

• expectedachangeintheamountofbenefittheyreceive,havingnotifiedtheLAofachangeofcircumstances?

• expectedanoverpaymenttooccuriftheyhadpreviouslyhadasimilarchange,whichcausedachangeintheamountofbenefittheyreceived?

2.215 ‘Reasonablyhavebeenexpectedtorealise’canbeinterpretedinthepersonaffected’sfavour,if

• youconsider,becauseoftheirage,intelligence(egcantheyread)ormentalcondition,thattheygenuinelywereunawareoftheofficialerroroverpayment

• theystatetheywerewronglyadvisedbyanofficial source;howevertheonusofproofwillbeonthepersonaffected.Insuchcases,astatementshouldbetakenfromallpartiesconcernedandadecisionmadeonthebalanceofprobabilities.

2.195-2.215


Amdt3 September2010


2.216 In some cases, an overpayment may need to be split into different classifications, ie partattributabletoofficialerrorandpartClaimanterror.Inthesecircumstances,determineatwhatdatetheerrortransferredfrombeingtheresponsibilityofonepartytotheother.

2.217 If,afterallthesefactorshavebeenconsidered,youaresatisfiedtheoverpaymentoccurredduetoofficialerrorandthepersonaffectedcouldnotreasonablyhavebeenexpectedtorealisetheywerebeingoverpaid,thentheoverpaymentshouldbecategorisedasnon-recoverable.

2.218-2.229

When should a recoverable overpayment be recovered?

2.230 Any recoverableoverpaymentmaybe recoveredat the LA’sdiscretion. If youestablishanoverpaymentisrecoverable,itdoesnotmeanyoumustrecoverit.

2.231 Thedecisionthatanoverpaymentisrecoverablemustbeseparatefromthedecisiontorecoverit.Dueregardshouldbegiventothecircumstancesrelatingtoindividualcases,whendecidingwhetherornotrecoveryisappropriate.

2.232 AnLAisnotobligedtomakerecoveries.Eachindividualcaseshouldbedecidedonitsownmerits,ieablanketpolicyforrecoverymustnotbeapplied.AnLAthatactedunreasonablyorirrationallycouldbesubjecttojudicialreview.

2.233 AnLAmustsatisfyitselfthatitisreasonabletomakerecoveryineveryindividualcase,seeRecovery of overpayments, Write-offslaterinthisguidefordetailsofrecoverableoverpaymentswhenadecisionismadenottorecover.

2.234-2.999

2.216-2.999

http://www.dwp.gov.uk/docs/hbopg-rec-op.pdf

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