Our local office is recovering an overpayment. They had suspended recovery pending the appeal but restarted on receipt of the statement of reasons. They tell me they will suspend recovery again when 'the appeal is accepted' (by which I am assuming they mean leave is granted).

I'm sure I've read a decision which states that recovery should hold off until the matter is settled, but I can't find any reference, or any help in the DMG or anywhere else.

Can anyone remember, have any ideas or experience? Many thanks.

Now then, it may be on a different tack, but in CIS/2654/99, Commissioner Fellner decided that a claimant was entitled to reduced Income Support on the basis of an appeal against an incapacity decision until it had finally been determined by refusal of leave to appeal. The principle being that the "determination of an appeal occurs only once it can be taken no farther, and not merely once a tribunal has reached a conclusion".

Seems to me that the local office should hold off overpayment on analagous grounds, but will they agree? That I don't know. Still, it might be some help.

Thank you so much Robbo that's exactly the case I was thinking about - it all comes clear now. (although I'd bet £20 they don't agree)

Andrew

Wed 20-Oct-04 02:04 PM by shawn

andrew,
my understanding is that there is no legislation, but it is accepted policy and good practice not to recovery until the appeal is finally determined. the case law supports the arguments about the end point (R(SB) 5/91 might also help) and your LO actually appear to have accepted the argument, and doesn't really have an excuse about its stop/start messing about. sounds like a rush of red tape to the head. they ought to drop it on confirmation from you that leave to appeal has been applied for. i wouldn't bet £20 quid, though! : )

i think on previous threads the lack of legislation on this has been discussed, and if the DWP changed it's policy there'd only be the JR route to challenge it.

the principle that recovery of a disputed overpayment before the dispute is resolved is WRONG, has been endorced in a local government ombudsman's decision a few years back, and if the link below works, scroll to decision 10. i've found it useful in the past.

jj

http://www.lgo.org.uk/pdf/digest00/secte00.pdf

Is this principle wide enough to stop the Inland Revenue administratively clawing back alleged TC overpayments while an appeal on the underlying entitlement decisision has still not been decided? Or would it be, if anyone at the TCO actually understood that its for a Tribunal, Commissioner, Court etc to determine an entitlement appeal rather than for one of their officers to dismiss it?

(If this should have been put in the TC forum with a link to this thread, then I apologise - maybe one of our friendly technical wizards at rightsnet could put it right?)

Thank you both for your comments.

I have a feeling that this may be more a symptom of our local office's debt management section being told of imminent redundancy between the request and production of the statement of reasons as much as anything else. (Not that I blame them for feeling uppity, but I do if they take it out on my client)

I'm afraid Gerry that even the previously discussed rioting in the street may not be enough to get the Inland Revenue to stop their officers unilaterally settling and/or just telling a claimant that an entitlement appeal is actually a non-recoverable overpayment and so doesn't need to be settled because it doesn't even exist.

Is somebody please please please trying to JR them on the subject?

Para 6 of R(SB) 5/91 quotes CSB/1158/1982:

"'Accordingly until adjudication is complete the Secretary of State has no right to recover.'"

And then at para 7: "...when the amount of overpayment has been finally determined by , as in this case it is by my decision (unless it is proposed to take the matter on appeal to the Court of Appeal), then, and then only, for the purposes of recovery by action in the Courts, time begins to run."

I think that's pretty clear - surely recovery by way of deduction from benefit is analogous to recovery in the courts?

Thanks jj not so sure about my £20 on that one!

the above works ok where you have a clear overpayment decision (amount, period and how it arose), restrictions on the powers of recovery, a right of appeal, and an independant adjudication process.

we can be sure that once upon a time some scruples about the morality of enforcing repayment from poor people who would experience further hardship, must have existed.

the restrictions on power of recovery have variously been in the areas of 'good faith', 'due care and diligence', 'misrepresentation/failure to disclose' and official errors, prior to any need for the exercise of discretion in the matter of recovery. and where recovery is required, repayment by installment is allowed, with legal restrictions on the weekly amount, as a percentage of benefit income, with discretion for lower amounts to be negotiated.

with the tax credit system, there is no right of appeal against the overpayment decision itself and no restrictions on the powers of recovery, including official errors. there is a discretion, which is not exercised unless representations are made, if i understand correctly. recovery can be made by reducing the current tax credit entitlement or altering the tax code, and from what i am seeing, just stopping the payments whilst the Inland Revenue looks into things and makes a decision. (leaving aside what the I R can do via the courts if it wants to get really nasty).

in addition, it can impose penalties if it decides an offence has been committed. (this could be signing a review form which has incorrect information on it). It can mitigate the penalties at its discretion - say down from £1000 to £300, and it expects immediate payment of penalties, unlike the overpayment which it wants to have paid back within three years. it has difficulties providing comprehensible and accurate award notices, even when information has been correctly provided, and contact with the IR is via an under-resourced call centre, which can only access claim information which has been put onto the computer system, and it cannot give out telephone numbers so that you can speak to the person you need to speak to.

the decision on whether there has been an overpayment or offence in some cases, is made at the end of an enquiry or examination interview, by the person who has actively participated in the interrogation which he/she had prepared for beforehand, in the role of investigator. if the findings are disputed, the IR can require proof from the claimant, eg to show that she was NOT living with her husband, and say things like - it must be official documents and they won't accept statements from relatives ie the onus is on the claimant to prove a negative, and they get to dictate what evidence they will or will not accept.

have i lost the plot already?

jj

No.