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Capital over limit but possible disregard
Hi
I have a client who had £24,000 in a few bank accounts which she did not declare but has been found out and now has massive Overpayments of Income Support, Housing Benefit and Council Tax Benefit.
Aside from the fact that IS have not used diminution of capital so the Overpayment is way larger than it should be I have another issue around lump sum payments of benefits.
In 2004 my client received a telephone phone call out of the blue from Income Support to tell her she had been underpaid a disability element for her daughter (who got DLA) and they were going to send her a payment of £10,500 (rough amount, out by a few pounds).
This she received a few days later.
My client did not spend this money and instead put it into a bank account. It is not clear where the other money came from but that is irrelevant for the purposes of my disregard anyway.
When my client was inteviewed by fraud they did not even know she had received an Underpayment in 2004 but when the claim was assessed they decided to disregard it for 1 year only.
My appeal was centred on the benefit lump sum being disregarded for as long as the client remained on Income Support as the underpayment was due to official error and the amount paid was over £5000. Income Support did not agree hence we are waiting on a Tribunal date.
Because this involves more than one benefit there has been lots of toing and froing to HMCTS and my latest direction says that we have to provide proof that it was an official error as DWP have disregarded for 52 weeks already.
The client has no letters and the DWP have no info as their system has been archived so how exactly can I prove that it was official error.
I was hoping to go on the balance of probabilities - what are the chances that someone claims IS and suddenly becomes entitled to £10,000 which is paid as a normal payment???
Any help on this would be appreciated.
Also the submission from DWP mentions a completely different name to my clients but also mentions that the capital limit levels have changed - does anyone have a list of capital limits and when they changed?
Thanks for any help you can give
You need to ask for a subject access referral for her archived documents
You need to ask for a subject access referral for her archived documents
Sorry I did not mean archived I meant deleted.
There are no records anywhere as the system automatically deletes it after 6 years.
If it wasn’t an official error then such a large amount couldn’t possibly have been paid given restrictions in arrears for postive supersessions and/or backdating.
I think that that in itself should be quite determinative so long as you can confirm the client’s circs from the start of the claim so you can ‘ghost calc’ what might have been due from non-official error arrears payments - if you see what I mean?
Helpfully IS as part of the appeal pack have given me hundreds of pages which list the payments the client received over the last 12 years (which is interesting if the claim that all records have been deleted are true)
I will double check what happened after the date in 2004 when she got her money although interestingly the payments made to her do not list this lump sum although DWP acknowledge they sent her a payment of £10,500.
Thanks for your help
Is it clear that DWP forgot to apply the disability element or did they only have enough information to award it down the line? My experience is that DWP does award the SDP back quite a long way even when the claimant didn’t apply for it, not sure about other additions for disability.
Does your client have capital now? Diminishing capital rules only apply where there is notional capital. If there is actual undisregarded capital of over £16,000, diminishing capital rules won’t help your client.
Is it clear that DWP forgot to apply the disability element or did they only have enough information to award it down the line? My experience is that DWP does award the SDP back quite a long way even when the claimant didn’t apply for it, not sure about other additions for disability.
Does your client have capital now? Diminishing capital rules only apply where there is notional capital. If there is actual undisregarded capital of over £16,000, diminishing capital rules won’t help your client.
I agree that diminishing capital rules apply with notional capital but they also apply with actual capital in regard to Overpayments but is called diminution of capital rule.
This applies if there is an issue with capital being taken in to account (rightly or wrongly) and the OP lasted more than 13 weeks. It is all about reducing the capital by the amount of any OP for the same period and is calculated every 13 weeks for the whole period of the OP.
There should be some movement on this soon - we have a hearing scheduled for next month.
If it wasn’t an official error then such a large amount couldn’t possibly have been paid given restrictions in arrears for postive supersessions and/or backdating.
I think that that in itself should be quite determinative so long as you can confirm the client’s circs from the start of the claim so you can ‘ghost calc’ what might have been due from non-official error arrears payments - if you see what I mean?
Hi Tony
I have attempted a ghost calculation and the amount of money they were paying the client prior to the lump sum is about £28 per week less than I think she should have been getting if they paid for 2 children or £10 per week too little if they were paying for 1. (I have allowed for lone parent premium, family premium and 1 or 2 child premiums - is there anything I have forgotten?)
Interestingly the week after the lump sum was paid they increased her payments by exactly the same amount as the Disabled Child and Enhanced Disability (Child) premiums.
It seems from looking at the payments that the client applied for CA in 2004 and when this was awarded it has triggered something which has made them look into the claim.
The daughter got DLA in 1997.
Do you think this is enough to prove official error?
You need to ask for a subject access referral for her archived documents
Sorry I did not mean archived I meant deleted.
There are no records anywhere as the system automatically deletes it after 6 years.
I wouldn’t accept that out of hand; I’ve done a couple and got info going back 10 years and more. Ask and you might receive; clerical and computer based records
Thanks for this Tony - looks like we will have to wait for the Tribunal to decide.
I will ask for a SAR and see what the DWP come back with.
I worked out Disability Premium from 1997-2000 and then DP and EDP from 2000 onwards and it comes to just over £11k.
We don’t actually have any proof they paid the money except the clients say so and also they acknowledge the client got a payment hence they mention a 52 week disregard. We know the date but that is because DWP told us in the submission pack but no where have they mentioned the amount (I am not sure if it is because they don’t know or because for their argument the amount is irrelevant).
The figure I gave above of £10,500 is just a best guess from the client.
Will see what the SAR brings in.
Thanks again
Well we had our appeal and it went very well.
The DWP PO said that he felt the client should not have had the backdated money and that in itself was an official error but the fact she was given the money backdated for all those years was not an official error!!
The Appeal Judge was very good and said that the client seemed damned if she did and damned if she didn’t!!
Interestingly the DWP PO had papers which had not been included in the bundle for Tribunal and the Judge was all for adjourning the hearing but we were happy to go ahead.
He had a very important piece of paper that everyone at DWP told me didn’t exist - it was the memo card from Carers Allowance Unit to IS team in my local area advising them of CA, on the same card was the notes from the Assessing Officer with her calculations and how much she awarded each year and the total amount paid which was only £100 more than my client thought!!
In the end the DWP agreed that their had been an official error which had caused the award and the large backdated Underpayment and it should be disregarded for the lifetime the client is on the benefit!!
DWP have adjusted the OP of IS and the client only owes £2000 instead of £8000 but what they haven’t done is re-opened her claim from Jan 2012 when they closed it due to excess capital. Apparently the team who deal with changing the OP did not notify our local benefit centre and so they werent even aware a Tribunal had been held.
I have asked them to re-open claim from Jan 2012.
The end result should be that she only has the IS OP of £2000 instead of OP’s of £23,000 from IS, HB & CTB.
But then we have the issue of when she gets all the backdated money it may well take her over the capital limit even though £10,800 is disregarded!!!