ASSESSMENT OF THE OVERPAYMENT by tum19250

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									                        APPENDIX A




 POLICY ON THE RECOVERY OF
OVERPAID HOUSING AND COUNCIL
         TAX BENEFIT
                                POLICY OBJECTIVES

When dealing with the administration of overpayments, Staffordshire Moorlands District Council
undertakes to:

   Make fair and good quality decisions about the recovery of overpayments.

   Comply with the rules of the Housing and Council Tax Benefit scheme.

   Properly notify the people affected by our decisions and tell them about their rights of
    appeal.

   Provide relevant and accurate information, when required, to the person who has been
    asked to repay the overpayment.

   Work to process cancellations of entitlement and reconsideration requests / appeals
    regarding overpayments as quickly as possible.

   Offer customers a flexible and structured means of repaying their debts through deductions
    from ongoing Housing Benefit and instalment plans where an invoice has been issued.

   Reduce the total level of debt outstanding in respect of overpaid Housing Benefit




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                                      CONTENTS

1. Assessment Of The Overpayment                                                   4

2. Who Should The Overpayment Be Recovered From?                                   4

3. Notifying The Decision                                                          5

4. Recovery Of The Overpayment                                                     5

5. Deduction From Ongoing Benefit (Weekly Reclaim)                                 6

6. Recovering The Overpayment From The Landlord                                    7

7. Recovery From Arrears Of Outstanding Housing Benefit                            7

8. Recovering Overpayments By An Invoice                                           8

9. Recovering An Overpayment Of Housing Benefit On Behalf Of Another Authority     9

10.   Recovering An Overpayment Of Housing Benefit From Social Security Benefits   9

11.   Overpayments Of Council Tax Benefit                                          9

12.   Appendices (not included)

      Appendix A – Overpayment „Write Off Request‟ Proforma

      Appendix B – Invoicing Procedures

      Appendix C – Council‟s Debt Recovery Policy

      Appendix D – Council‟s Write Off Policy




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1.     Assessment Of The Overpayment

At the point of assessment of each claim that will result in an overpayment the processor will
ensure that the following steps are followed:

1.1.   The assessment is actioned as soon as possible

1.2.   The claim is cancelled from the correct date, or in the case of a disadvantageous change
       that will result in some Housing Benefit entitlement remaining that the change is actioned
       on the correct information and from the correct date.

1.3.   That where the customer‟s current circumstances are unknown, a new form will be
       issued to either assess subsequent entitlement or underlying entitlement.

1.4.   A decision is made as to whether the overpayment is recoverable or non-recoverable.
       (An overpayment is non-recoverable if it was caused by an official error and the person
       affected could not have been reasonably expected to know of the overpayment. )

1.5.   Where the overpayment is recoverable, would it be appropriate to exercise discretion and
       not recover the debt? There is always discretion in whether we should recover a debt or
       not, and this discretion is not open to appeal by debtors.

       The request to consider an overpayment for write off should be submitted to the Benefit
       Manager – See Appendix A. The request, if agreed by the Benefit Manager will then be
       submitted to the Head of Finance for consideration.

1.6.   From which party should the overpayment be recovered?

       For details on the considerations to be made at this stage, please refer to section 2 “Who
       should the overpayment be recovered from?”



2.     Who Should The Overpayment Be Recovered From?

2.1.   An overpayment may be recovered from any of the following

          The applicant
          The applicant‟s partner (but by deductions from benefit only when the applicant and
           partner were partners both at the time when the overpayment was caused and at the
           time it is being recovered.)
          The person to whom the Housing Benefit was paid (being a Landlord, Agent, or
           Appointee.)
          In the case of an overpayment being caused by a misrepresentation or failure to
           disclose a material fact, the person that made the misrepresentation or failed to
           disclose the fact.
          The estate of a deceased person.
          The claimant‟s appointee


2.2.   The decision about which person or body recovery is to be made from is at the discretion
       of the Local Authority.

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2.3.   Each decision should be made on its own merits and take into consideration “all relevant
       factors”. In most cases it will be apparent which party it is most appropriate to recover
       from – for instance, overpayments caused by changes in the applicant‟s income will
       usually indicate recovery from the applicant.

2.4.   There are prescribed circumstances when we cannot recover from a Landlord. These
       are when:

       a)    The Landlord has informed the Local Authority or the Benefits Agency in writing that
             he suspects there is an overpayment, and
       b)    It appears to the Authority that the overpayment has been caused by the customer
             attempting to commit a fraud or by deliberately failing to report a change of
             circumstances and
       c)    The Authority is satisfied that the Landlord has not colluded with the tenant or
             acted/failed to act so as to contribute to the period or the amount of the
             overpayment.

       The Landlord is not protected from recovery proceedings where the overpayment arises
       from the fact that the claimant has left the property.



3.     Notifying The Decision

3.1.   The determination notice of the overpayment should be promptly dispatched to the
       “persons affected”. The “persons affected” will always be the applicant themselves, and
       also the Landlord, Agent, Executor or Appointee when the overpayment is to be
       recovered from them.

3.2.   It is important to note that we should always send a decision notice to the customer, even
       when we choose to recover from the landlord. This is to ensure that the customer has the
       right to appeal against any aspect of our decision.

3.3.   The decisions will always be dispatched on the day they are produced.

3.4.   The decision notice shall be checked for accuracy and amended if required.



4.     Recovery Of The Overpayment

4.1.   Recovery may be pursued by any of the following methods:

           By deductions made from on-going benefit.
           By recovery from the payments made to a third party in respect of the tenant or other
            tenants.
           From arrears of outstanding Housing Benefit.
           By an invoice.
           By asking another local authority to recover the overpayment from Housing Benefit
            that they are paying.
           By deduction from Social Security Benefits.

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          For Council Tax Benefit only by adding overpaid Council Tax Benefit onto a claimants
           Council Tax Account as an amount of Council Tax owed.


4.2.   The method selected must be appropriate to the circumstances of the case



5.     Deduction From Ongoing Benefit (Weekly Reclaim)

5.1.   This method is most commonly used when we have decided to recover an overpayment
       from a tenant, and that tenant is still in receipt of Housing Benefit.

       Deductions from entitlement where the payments are paid to a Landlord constitute
       recovery from the tenant, not the Landlord.

5.2.   There are maximum amounts set by law governing the amounts that may be recovered
       by ongoing deductions. These are increased each year by the DWP.

       The amounts for the current financial year are as follows:

          £8.70 per week
          £11.60 per week where the customer has committed a fraud. (see 5.6 below)

       In addition to the above deductions we can also recover additional amounts equal to:

          50% of the customers standard earnings disregard (i.e. 50% of £5, £10, £20 or £25)
          50% of the £20 disregard made in respect of Charitable or Voluntary Payments
          50% of any £10 War Pension Disregard
          50% of the disregard to maintenance payments

5.3.   We should maximise the rate at which recovery is made but ensure that due regard is
       made for any financial difficulties encountered by the customer. We should always
       ensure that the customer is left with a minimum of £0.50 per week as benefit.

5.4.   If a customer is having difficulty in repaying the overpayment because the level of
       deduction is too great then we undertake to consider any representations.

5.5.   If a customer wants to pay more and gives their permission we can recover a higher
       amount than the maximum rate. The customer must be made aware that the higher
       payment is entirely voluntary.

5.6.   A customer is said to have committed a fraud if:

          They have been found guilty of an offence in Court, or
          They have accepted an Administration Penalty, or
          They have accepted a Formal Caution.

       (An investigation being undertaken into a suspected customer will not constitute a
       fraudulent case if none of the sanctions above are made)




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6.     Recovering The Overpayment From The Landlord

6.1.   There are two ways in which an overpayment can be recovered from a Landlord.

          By deducting amounts from their schedule of payments (blameless tenant recovery)
          By raising an invoice as a sundry debt through the Recovery Section


6.2.   Deducting an Overpayment from the Landlords Schedule of Payments

6.2.1. This can be done when the Landlord has incurred a recoverable overpayment and still
       has other tenants that are receiving Housing Benefit paid directly to that Landlord.

6.2.2. To facilitate this, our Landlord Schedule and Rent Allowance Notification carry
       information explaining this option.

6.2.3. In such circumstances the tenant that has had payment reduced to cover the
       overpayment of another tenant is to be treated by the Landlord to have received the
       amount of benefit that was recovered.

       Example

       If Landlord A is overpaid £50 because tenant B has left the property we can recover the
       £50 from the entitlement paid for tenant C. The Landlord is then obliged to treat the £50
       as having been received for C and cannot take action for arrears of this sum against
       tenant C but must go back to tenant B for the money.

6.2.4. Normally recovery will not be pursued by this method whilst the overpayment is subject
       to review or appeal. In any case, the first instalment of a debt will not be demanded
       before the period in which a reconsideration or appeal can be made has expired.

6.2.5. We can also recover an overpayment from the Landlords Schedule of payments in
       respect of a tenant that is still resident. In addition, any overpayments may be recovered
       from the Landlord Schedule by the request or agreement of the Landlord.

6.2.6. Just as we must consider the financial circumstances of a customer where we are
       making deductions from entitlement, we should also consider any potential financial
       difficulties that would be caused to a Landlord when we recover overpayments from their
       schedule.

6.3.   Raising an Invoice as a sundry debt through the Recovery Section – see Section 8



7.     Recovery From Arrears Of Outstanding Housing Benefit

7.1.   Overpayments may also be recovered from arrears of outstanding entitlement.

7.1.1. Where a person is entitled to revised Housing Benefit for the same period as the
       overpayment, this will be used to reduce the overpayment. This is called “offsetting”
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7.1.2. Where a person is entitled to Housing Benefit for a different period to that of the
       overpayment, any arrears of benefit due can be used to recover the overpayment.


7.1.3. We must consider whether the recovery of the overpayme nt from the arrears would
       cause the claimant hardship or financial difficulty. If this is the case then consideration
       should be given to reducing the amount of recovery from the arrears and making weekly
       deductions for the balance of the overpayment.

7.2    If a customer changes address, we have the discretion to recover an overpayment from a
       previous tenancy in one lump sum from the Housing Benefit due for the second property
       as shown in the following example: -

       Example

          A customer receives HB for Property A at £80.00 per week
          The customer moves to Property B and is entitled to HB of £70.00 per week
          The customer informs the Local Authority that he has changed address 3 weeks after
           he has moved

       There is an overpayment of £240.00 for Property A (i.e. 3 x £80.00) as the customer has
       not been residing in the property. The customer is entitled to £210.00 (i.e. 3 x £70.00) for
       Property B.

       The LA can recover £210.00 of the overpayment for Property A from the HB owing for
       Property B. The remaining £30.00 overpayment should be recovered weekly from the
       customer’s ongoing HB payments (see section 5).

       If the HB credit is more than the overpayment, the remaining credit should be paid to the
       customer.

7.3.   A further way to reduce overpayments is to consider cases where there may be an
       underlying entitlement to benefit. Where necessary further information should be sought
       from the claimant to establish underlying entitlement.

7.3.1. Where a decision is made to refuse “backdated” benefit the case should be investigated
       to determine whether there would be an underlying entitlement that could be offset
       against the overpayment.

7.3.2. Underlying entitlement will not be calculated to reduce an overpayment that occurred as
       the result of a change of address. This will allow the overpayment at the property the
       customer was not residing in to be recovered and alleviate the problem of rent arrears at
       the new address.



8.     Recovering Overpayments By An Invoice

8.1.   The traditional way to recover an overpayment from a debtor, be it a Landlord, a
       customer no longer in receipt of Housing Benefit, or an executor of a deceased claimant;
       is to raise an invoice.

8.1.1. Invoices are usually raised one calendar month after the overpayment has been decided.

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       Please refer to the Sundry Debtor Invoicing/Overpayment write off from Pericles
       guidance note – Appendix B


8.1.2. Recovery of the outstanding debt will be made in accordance with: -

       Staffordshire Moorlands District Council Debt Recovery Policy – Appendix C
       Staffordshire Moorlands District Council Write Off Policy – Appendix D


9.     Recovering An Overpayment Of Housing Benefit On Behalf Of Another Authority

9.1.   The law allows for one Local Authority to recover an overpayment of Housing Benefit
       made to another authority where the claimant is in receipt of Housing Benefit at the
       recovering Authority.

9.2.   The recovery is achieved by deductions from Ongoing Benefit (Weekly Reclaim) in
       accordance with the regulations governing this. The amounts are then passed to the
       Local Authority, which raised the original overpayment, to clear the debt.

9.3.   Use of this method of Recovery is rare due to the complexity of the arrangement.


10.    Recovering An Overpayment Of Housing Benefit From Social Security Benefits

10.1. It is possible to request the Benefits Agency to reco ver an overpayment of Housing
      Benefit. This can only be done if there is no Housing Benefit entitlement outstanding and
      the customer is in receipt of Benefits Agency benefits.

10.2. The DWP will only recover a Housing Benefits overpayment that was caused by the
      customer (or someone acting on their behalf) misrepresenting or failing to disclose a
      material fact.

10.3. The BA cannot recover an overpayment of HB from the following benefits;

          Guardians Allowance
          Child Benefit
          Retirement Pension
          War Pension



11.    Overpayments Of Council Tax Benefit

11.1. Overpaid Council Tax Benefit is referred to in the regulations as “Excess Benefit”.

11.2. Recoverable Excess Benefit will always be recovered through the Customers Council
      Tax account.

11.3. The issues of method of recovery, level of ongoing deductions, party from whom
      recovery is to be sought etc. do not apply to Excess Council Tax Benefit.

11.4. However, exercising the discretion not to recover, and deciding that the overpayment is
      recoverable are both issues that definitely must be considered with Excess Council Tax
      Benefit.
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