Charities worried after AVDC claim back overpayments

Charities worried after AVDC claim back overpayments

Published by Mix96 News at 5:44am 25th March 2019. (Updated at 7:26am 25th March 2019)

Aylesbury Vale District Council reclaimed more than a million pounds in overpaid housing benefit from claimants, which charities say could push them dangerously into debt.

Turn2Us, which helps people in financial hardship, warned that recovering funds paid in error could have a "snowball effect", putting people at risk of serious poverty and impacting their mental health.

The Department for Work and Pensions data shows the amount of money recovered by the local authority which was accidentally paid to people who are not entitled to benefits or who got paid more benefit than they should. Cases of fraud are excluded.

The latest figures show that, in the nine months to September, housing benefit claimants had to pay back £1.22 million to Aylesbury Vale District Council from overpayments.

Matthew Geer, campaigns manager at Turn2Us said:

"A benefit overpayment can happen for many reasons. It’s often something as simple as a DWP error or a small unreported change in circumstances.

"However, we are seeing that overpayments can have a real snowball effect on some claimants which often results in people falling into more severe debt and being harassed by bailiffs.

"The impact this can have one someone’s well-being is often overlooked and we speak to people every week struggling with their mental health as a result."

Housing charity Shelter says the rates at which "housing benefit overpayments are clawed back can be be incredibly high", which can push people into debt and homelessness.

In Aylesbury Vale, the bulk of the money reclaimed, £1.2 million, was to housing associations or private tenants. A further £10,000 was repaid from rent reductions for council tenants.

Additonally, Aylesbury Vale District Council wrote off £96,000 of housing benefit overpayments.

In September 2018, the council still had £7 million of housing benefit overpayments outstanding.

Mr Geer added:

"We encourage local authorities to take a holistic and sensitive approach to recovering accidental overpayments.

"It is vital that a benefit overpayment doesn’t become a trigger for falling into serious poverty."

Across Great Britain, overpayments during the period totalled £588 million, a 15% drop compared with two years earlier.

During that nine month period, local authorities recovered £506 million of housing benefit overpayments, while £74 million was written off.

A total of £2.1 billion remained outstanding across the country in September.

AVDC had this to say:

“Aylesbury Vale District Council (AVDC) has a responsibility to protect public funds, including where overpayments of Housing Benefit have been made.

In most cases, these overpayments have arisen due to a delay in claimants notifying our Housing Benefit team of a change in their circumstances.

These overpayments are recoverable in line with legislation.

In all cases, it is the claimant’s responsibility to inform our Housing Benefit team of changes in their household which can affect the amount of money they receive towards their rent.

Overpayments are usually collected from ongoing payments of Housing Benefit in line with amounts dictated by current legislation.

However, when a claimant is no longer entitled to Housing Benefit, the outstanding amount is invoiced to them with information on the various ways in which this can be repaid.

Most commonly, claimants set up an affordable repayment plan with a member of our Recovery team.

We also offer the services of our in-house Debt Advisory team, if it is felt the collection of the overpayment could possibly cause hardship.

Furthermore, we sometimes refer people to the Citizens Advice Bureau for additional support.

On 26 September 2018, Aylesbury Vale became a Full Universal Credit service area.

Since then, if a claimant has a change of circumstance, our Housing Benefit team is notified by the Department of Work and Pensions (DWP) to stop paying Housing Benefit.

This claimant is then required to claim Universal Credit to cover their housing costs and at the same time any collection of overpayments from ongoing Housing Benefit will cease.

Any existing Housing Benefit overpayments being collected at that time will then be invoiced by AVDC for the amount outstanding amount with details of the various ways this can be repaid.

AVDC does not own any council houses or have any council tenants, but works closely with local housing associations to ensure claimants are awarded the maximum amount of Housing Benefit available.

However, we can only act on the information provided to us by a claimant or a third party (a housing association, for example), and when this information is either incorrect or withheld a claimant can be overpaid.

We have a duty to collect overpaid amounts, which is why it is very important that claimants notify our Housing Benefit team as soon as there is a change in their circumstances to minimise any financial impact on them."

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