My client moved into a new property in May 2005. She was unaware that there was an overpayment dating back to 2000 - 2002 at her previous address. Both properties are owned by the same local authority. Her HB was not paid for six weeks after she moved, creating an overpayment. This sum was then used, in full, to pay off the earlier overpayment, without her permission. She was left with arrears of £500.00 and the local authority has commenced possession proceedings.
Was this lawful? Where in the regs is this dealt with?

correction, there was obviously an underpayment created when the HB was not paid for six weeks. This was used to pay off the earlier overpayment.

How did the overpayment happen?

Start with Regulation 99 of Housing Benefit (General) Regulations 1987, recoverable overpayments. This sets out what is or is not a recoverable overpayment. Establish if it is your clients fault the overpayment happened or an office error.

Then go to Regulation 101 of Housing Benefit (General) Regulations 1987, person from whom recovery may be sought.

It appears that the overpayment was created by my client's ex-husband who was intermittently in work. I would assume that recovery can be sought from my client, but can the underpayment be used in full to offset the overpayment without her permission. She is a single parent on income support.

Reg 102 (2)which limits the amount of O/P recovery from ongoing entitlement does specifically exlude "other than deductions from arrears of entitlement".

So, unfortunately, It looks as though the LA can do it.

Re the local Council seeking possession for rent arrears.

If you have the Welfare Benefits and Tax Credit Handbook publish by Child Poverty Action Group. Go to page 1091 of this years volume.Read Adjustment of a rent account.

It says ifyou are a local authority tenant and a overpayment recovery has left you in rent arrears then the overpayment recovery should be seperatly identified and you should be told that the amount recovered does not represent rent arrears, see R v Haringey LBC exparte Azad Ayub <1992> 25HLR 566 (QBD)

It then goes on to say if the local council are seeking possession for rent arrears, it should not be able to say you have rent arrears if you have been overpaid HB. Local Councils are reminded by the DWP that overpayments of HB in respect of their tenants are not rent arrears and should not be treated as such, see paras A7.361 GM.

your client did not pay rent to the council while waiting for her housing benefit claim to be determined (14 days or as soon as etc). The council took 6 weeks to award housing benefit, but 'pays' it to itself, in recovery of an earlier overpayment which she was unaware of !!! and then the LA housing department seeks to evict her on the grounds of rent arrears. its stunning when you think about it.

i've no idea why a local authority benefit administration and a housing administration would think it is a reasonable to seek to take away the home of a person on low income - (she is a person Parliament intended the housing benefit scheme should help), on the basis of a debt which she has a legal right to dispute, but of which she had no prior knowledge or opportunity, and where recovery is discretionary, reasonably taking account of the person's ability to pay.

the local authority should not wish to to make vulnerable people homeless or frighten them into debt (eg borrowing the whole £500 from loan sharks)- and should give some consideration to the effects of its actions. (maybe there was none and it's all decided by computers???) the maximum use of force is disproportionate, and one wonders whether CEO's give tuppence for the primary purpose of the services they provide or the people they are serving. (i gather from yesterday's newspaper that the commodities market has inflated the 'scrap' value of old two pences higher than it's face value.)

grounds for JR imo.

No, they should not have recovered the overpayment in full.

This should be recovered by the prescribed weekly deduction under Reg 102, which is how we would deal with this. They could therefore at best have taken 6 weeks worth of £8.70 or whatever the weekly amount is.

The meaning of 'arrears of entitlement' is very unclear, but I am convinced it should not apply in this case and the DWP's policy intention backs this up in their Overpayments Guide.

The 'arrears of entitlement' should not apply when the arrears are a result of an LA's slow processing of a new claim or an amendment. It should only be used in case where there is some additional benefit due for a past period.

If you query it and sight that it goes against DWP advice, they should put it right.

Paul

Under the HB legislation the LA can use the arrears of benefit to recover an overpayment, but it is certainly argueable that this was never intended to cover arrears caused by delays in processing.

However recent changes to the HB regs strengthen the LAs position. (See circular A4 2006 part of which is copied below).

Regulation 7(3) to (5) amend Regulation 102 of the HB regulations, allowing LAs the discretion to recover an overpayment from a previous tenancy in one lump sum from the HB due for the second property. They also prescribe how the LA should calculate the amount of the overpayment that can be recovered. This will reduce LA administration costs and stress for the claimant in having deductions made from
their future entitlement.

Again, this was probably not intended to cover this situation but it appears to allow it.

i also agree there is a question mark over the meaning of arrears - one would hope the system does not build in an incentive to delay processing to increase the amount recovered.

the key words in circ A4 2006, imo are 'allowing LAs discretion...'

it is difficult to see how discretion has been exercised well if the decision results a £500 debt to the housing department which the claimant cannot afford to pay in a lump sum, and facing court proceedings for the possession of her home most definitely is not a reduction of stress on the claimant. there are provisions in the regulations intended to take account of the fact that people on benefits are rarely in a position to pay large lump sums, so there is guidance in the legislation itself, to inform the exercise of discretion.

the mention of reduction in administration costs is interesting, because here we see that the decision of one council department results in a debt for the claimant to another council department, requiring administrative actions in the latter department threatening or referring for court proceedings to seek possession, and the claimant has to seek legal advice, maybe funded under legal help contract...dcarlin now has to write to the benefit service to try to sort out the mess, tieing up more LA admin resources, and maybe he can't persuade the LA to see sense and he has to defend against the possession hearing, so there's all those court staff, and whatever happens, the same thing can happen again with somebody else over and over...

its one hell of a gravy train at who's expense exactly? and so unnecessary...the legislation wasn't conceived without policy intentions...reinventing the wheel, only making it square this time...you can see how the scrap value of a tu'penny piece is more than its face value...

You cannot recover an HB overpayment in full from arrears of Housing Benefit - unless the arrears of benefit cover the same period as the overpayment.

This overpayment should have been recovered at the weekly rate of £8.70 for the period that was covered by the Benefit entitlement due.

I assume this overpayment was being recovered from ongoing entitlement at the previous address, or it was left unrecovered and only discovered when the cliamant had moved. She may still need appeal rights for this overpayment depending on when she she was informed about how it occurred etc, and she would have had to have been the claimant on both claims or her husband wouold still have to with her now. (I only mention this because you have said the husband caused it - so if he was the claimant at the time the op occurred and is no longer with the partner it cannot be recovered from her on her current claim).

With regard to the new regs a LA can only recover an overpayment in one lump sum if it was caused by a move from one property to another, eg the claimant moved out on 2 April but was paid Ben until 30 April - new property starts from 3 April and so the periods are consecutive and so the overpayment may be recovered - otherwise you are in effect paying benefit twice for the same period.

Hope this makes sense.

Ciran

Although I totally agree with you that as to the intention of the new regs. I think the way they are drafted gives a much wider power

(1A) Where—
(a) a claimant has moved into a dwelling which he occupies as his home;

(b) a recoverable overpayment of housing benefit is thereafter made direct to him in connection with the dwelling he occupied as his home immediately preceding the date he moved to that dwelling; and

(c) the same relevant authority which made the recoverable overpayment is paying housing benefit to that claimant in respect of that new dwelling, the relevant authority may at its discretion deduct from the housing benefit it is paying to the claimant in respect of a benefit week an amount equal to the claimant's weekly entitlement to housing benefit at his new dwelling, and may do so for the number of benefit weeks equal to the number of weeks during which the claimant was overpaid housing benefit.".

The only limiting factor appears to be that the overpayment is made after the move, and in connection to the old dwelling. In this particular case it would depend upon whether the overpayment was actually created some time ago and had been forgotten about until the move, or was created after the move.

I am afraid I also agree with derek_s that arrears are exempted from the weekly recovery rates limit.

”Arrears” for the same period as an overpayment are actually “sums to be deducted in calculating recoverable overpayments” and should fall under Reg 104.

I take your point - however the overpayments guide refers to arrears where you have revised a previous decision and so have increased entitlement for a period - this creates arrears of benefit which although it does not cover the same period of the overpayment can be used and offset in total against the overpayment.

It also states that delays in processing claims which then create arrears of Benefit cannot be used to offset an overpayment in one lump sum.

i happily agree with both of you. : )

located! - the key importance of the word 'thereafter'...

: )

Hi...another solution ... get her to apply as homeless to the same LA under Housing Act 1996 part vii (amended HA 2002) they must take an application although they can delay untill 28 days before the bailiff... however under s193 they should make a decision that they will provide temporary accommodation until they provide another permanent council tenancy. same LA that evicted her must rehouse her...

They could use s191, intentionally homeless for a "deliberate action on non- action" that causes the loss of accommodation... in your clients case ... during the period of the first tenancy when in full HB she "deliberately" did not contact then to make sure she did not owe them an overpayment... in the full knowledge that she would be evicted from her next tenancy if she did not contact them. They would not get away with that decision !

Lots of case law on intentionally home less... the bottom line being that children are taken into care ... at £500/week every week.

Use Wednesbury... no sane authority would get themselves into this possition.

If the ex husband was intermittently in work we are not talking about an overpayment, we are talking about a number of overpayments plural.

This means that there will be a number of decisions that must have been properly superseded and notified.

Get copies of all the decision letters and go through them with a tooth comb. It is quite possible that the notifications could be defective and/ or the decisons not validly revised or superseded. If you find any defects than you can argue that your clients rights of appeal are still current.

Dotn forget that followig Adan v Secretary of State and Hounslow Council, so called underlying entitlement should be offset in all cases, not just those after 2 October 2000