recovery of overpayment of HB

HI

can anyone point me in the right direction of any regs or guidance relating to recovery of HB overpaid as a result of transfer to UC?  I have checked regulation 11 of the overpayments and recovery regulations which sets out maximum rates of recovery but it does say that HB is specifically excluded from this. We are told that DWP are recovering the full amount of the overpayment from the UC - even if that leaves people with no money. Im just wondering if there is anything that sets out what is permissible in these circumstances?

Regulation 105 (HB) Recovery of overpayments from prescribed benefits

(1) Subject to paragraph (1B), For the purposes of section 75(4) of the Administration Act (recovery of overpaid housing benefit by deduction from other benefits), the benefits prescribed by this regulation are—
…
…
…

(h) universal credit.

(2) The Secretary of State shall, if requested to do so by an authority under regulation 83 (method of recovery), recover a recoverable overpayment by deduction from any of the benefits prescribed in paragraph (1) or (in the case of the claimant’s partner) any of the benefits prescribed in paragraph (1B) provided that the Secretary of State is satisfied that—
  (a) a recoverable overpayment has been made in consequence of a misrepresentation of or a failure to disclose a material fact (in either case whether fraudulently or otherwise), by a claimant or any other person to whom a payment of housing benefit has been made; and
  (b) the person from whom it is sought to recover the overpayment is receiving sufficient amounts of any of the benefits prescribed in paragraph (1) or (1B) (as the case may be) to enable deductions to be made for the recovery of the overpayment.

The maximum amounts deductible are here : http://www.legislation.gov.uk/uksi/2013/380/schedule/6

thank you Chacha. I will have a good look at this - my only thought is that is does say in consequence of misrepresentation of a material fact ..... This would not be the case here. Claimant has claimed UC; DWP have informed LA; HB ended - but often there is a delay in action (by either party) and HB has then often been paid for the period included in the first assessment period. HB is cancelled back to the date of claim of UC (I think) and it is this that creates the overpayment. Clt has not misrepresented or caused this in any way - just checking same reg would apply in this case?

dizzymare - 27 April 2016 12:00 PM

thank you Chacha. I will have a good look at this - my only thought is that is does say in consequence of misrepresentation of a material fact ..... This would not be the case here. Claimant has claimed UC; DWP have informed LA; HB ended - but often there is a delay in action (by either party) and HB has then often been paid for the period included in the first assessment period. HB is cancelled back to the date of claim of UC (I think) and it is this that creates the overpayment. Clt has not misrepresented or caused this in any way - just checking same reg would apply in this case?

don’t see in such a circumstance the claimant him/herself could have misrepresented anything.  Claimant does everything they are supposed to do and the DWP/LA can’t sort themselves out, how is that down to claimant?

Certainly worth challenging on that basis, i would have thought, unless someone knows of some other authority for overpayment recovery that LA could use?

These cases are covered by the UC Transitional Provisions Regs 2014. The HB overpayment arising directly from migration isn’t recoverable as an HB overpayment as such but it is used as income tapered at 100% in the same UC assessment period in order to prevent duplicate payments for the same housing costs. DWP is sayin"you are entitled to £1000, you’ve had £500, here’s the rest”

HB Anorak - 27 April 2016 01:09 PM

These cases are covered by the UC Transitional Provisions Regs 2014. The HB overpayment arising directly from migration isn’t recoverable as an HB overpayment as such but it is used as income tapered at 100% in the same UC assessment period in order to prevent duplicate payments for the same housing costs. DWP is sayin"you are entitled to £1000, you’ve had £500, here’s the rest”

Yes, here http://www.legislation.gov.uk/uksi/2014/1230/regulation/10, sorry thought you were referring to overpayments in general, like HB Anorak said, that particular o/p is not recoverable.

Thank you very much - that’s exactly what I was looking for - at least that explains the action.

Client has change of circs, moves from legacy bens onto full UC, starts paying over the housing element to the landlord. Client’s landlord also continues to receive HB, for reasons I am not yet clear on. UC have now caught up with this and are going to pay the client nil UC this month (assessment period 3). They have advised the client to take up the double housing payment with his landlord.

UC state in the journal “This is due to [overlapping HB] as your payment would have been less than this [...] Under UC guidelines this has to be as soon as possible. The remainder of the debt will be through DWP debt management”.

So as far as I can see, this is not UC treating HB received in the current month as income (which would have left some UC in payment), it is an overpayment from a past period being recovered.

Is it correct that an HB overpayment can be recovered from the full UC award in these circs, leaving the claimant with nothing to live on? CPAG p1233-4 suggests yes, there is no max rate of recovery. (From the journal, it seems to me that UC passing the remainder on to debt recovery is in response to a plea of financial hardship from the claimant).

I am unclear on whether HB have made a formal decision on the overpayment. Is there anything special about the HB -> UC scenario which means the usual rules on certain official error HB payments not being recoverable can’t apply?

This is how they should be tackling it:

- treat any HB paid beyond UC entitlement date as income for the APs in which it was paid
- adjust UC payment for the current AP accordingly: the HB paid during AP3 is effectively a down-payment of UC
- it’s too late to do that for APs 1 and 2, so they calculate a UC overpayment which is then recovered by instalments in the normal way.

But it sounds like they have not broken it down into individual APs: they are saying that £X of HB has been paid for the whole of APs 1-3; they have clawed as much of it back as possible from the UC payable for AP3, and then the rest gets dealt with as a residual UC overpayment.  The claimant’s rent is obviously in credit, and he can recoup that in due course by not paying his rent for a couple of months, but his problem is he has no money to live on in AP3.  If they had dealt with it properly and looked at each AP in isolation there would have been some UC payable for AP3 with a larger overpayment sent off to debt management.

Thanks for the reply. Just to follow this through ... the challenge to 100% of the UC being taken for the debt would be along the lines of:  as HB is recovered under s75 of the Administration Act, then para 3 of the Schedule linked to by chacha above should limit deductions to 40%?

I can’t find any relevant ADM for this.

The ‘HB Overpayment Guide 2015’ isn’t especially helpful, I don’t know if there is more up to date guidance somewhere:

4.110 ... Universal Credit At the present time there is no scope for deductions of HB overpayments from UC. The only deductions of HB from UC are those that are in place at the point of migration of the claimant’s benefit to UC.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/405550/hbopg-part-4-recovery-of-overpayments.pdf

There is no recoverable HB overpayment.  Separately, there is a recoverable UC overpayment because the HB payments made after UC started are used as income in the UC assessment.  I think there is an issue with the way the UC overpayment has been calculated/recovered - I think they should have dealt with each AP separately and released some UC in AP3.  But this is not a case of third party deductions, recovering HB overpayment on behalf of the Council: the TP Regs are clear that HB overpayments arising in these circumstances are not recoverable.  DWP are recovering their own overpayment here.

Ah, sorry that I’m being slow on the uptake. I was a bit misled by a comment put on the client’s UC journal saying “Due to the housing benefit overpayment you did not receive any payment of Universal Credit. ..”

.. but otherwise, yes I can see now it’s actually a UC overpayment.

Thanks again.

edit: a final cautionary note, which might be relevant to others .. in this case a subsequent journal note from DWP states that the cl is in fact in supported exempt accomm. This is the first mention that this is so, 5 months into the claim. So here, the HB was perfectly correct, and the UC o/p wasn’t caused by HB income, it was caused by ineligible housing costs. The overpayment was recovered in full before the decision explaining this was issued, which DWP later admitted was itself an error.