Housing benefit overpayment ...please help!

[joool]

I have just received a letter from the council demanding housing benefit overpayment of £1130 or they will start court proceedings in 7 days. The circumstances are as follows:

 

I moved from my house in September 2010 and phoned the council tax department to make them aware of my change of circumstances and to take my name off the council tax bill. They informed me would cancel it and my housing benefit payment also. I received a letter later in the week outlining the date of my last payment.

 

In February 2011 I was checking my bank account and realised that I had received a payment for October and November. I emailed them straight away to tell them there had been a mistake and they did not reply. I assumed that as it was an error on their part that I didn't have to pay. I moved to another EU country in March.

 

Ten months later they sent me a letter demanding payment in full within 7 days or face court action. They claim to have sent me two previous letters, but I have not received anything from them. I also do not have the letter they sent me last September saying when the payments would stop.

 

I am now in a complete panic, as the money is due in full tomorrow. Do I have any right to appeal? Can I ask for copies of the letters they sent me acknowledging my change of circumstances as proof that it was their error? As I now live in another country can they really take me to court?

 

Any advice would be greatly appreciated, thanks!

[Flyingchange]

Firstly, a 7 day letter of action is just a pre-court warning. Overpayment of housing benefit is classed as a sundry debt.

 

If you had been living in the UK it would be relatively straight forward in that most local authorities will write to you and offer you an arrangement to pay this back at a realistic rate to avoid going to Court. If you were in receipt of a current claim of HB it could have been clawed back at a set rate per fortnight. However, neither of these apply as you are abroad.

 

First things first, if the council want to instigate debt recovery proceedings they will have to take it through the small claims track of the County Court. The usual procedure is the court will send you a summons and you have 14 days in which to respond to it. (bearing in mind you are abroad the 14 days starts from the second day after it was posted). If the council want to go down this route, then you should expect to receive it in the mail in the normal way. If you admit the debt, use the admissions form to offer a realistic level of repayment and send it back straight away. Other enforcement options such AOB/AOE and distress clearly are not an option.

 

I will be surprised if they do to be honest and it may even be written off as 'uncollectable'. The old saying, obtaining judgment is one thing and enforcing it is another, would go a long way here I suspect. I will read your updates with some interest.

Edited November 21, 2011 by Flyingchange
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[borisbeaver]

First thing to do is to speak to them and arrange a repayment schedule. Only offer what you can afford.

 

If the council decide that you may have committed fraud then you will be asked to attend an Interview Under Caution. This interview is recorded and from this the council have three options.

 

1) Do Nothing and accept that you have a repayment plan in place

2) Give you an administrative Penalty (30%) of the overpayment and this is only taken after you have repaid the overpayment

or

3) Prosecution. This is a criminal prosecution and not civil so they won't go to the small claims court. The good news is that they normally prosecute for overpayments over £2000.

 

They won't write it off as it is tax payers money and they have a duty to try and recover the money.

 

With 1 and 2, if you don't make the agreed payments, they can then go down the court route.

[ErikaPNP]

I'd encourage you to liaise with them to set up a repayment plan - most councils will agree to a repayment plan unless of course there has been one previously and repayments haven't been made. Housing Benefit is not covered by the Supreme Court decision; a housing benefit overpayment as a result of official error is still recoverable if the claimant knew, or there is a reasonable expectation that they knew, that they were being overpaid. As you knew you were being overpaid, the overpayment is recoverable. The relevant legislation is the Housing Benefit Regulations 2006.

[joool]

Hello everyone,

 

Thank for all your helpful advise.

 

I just called the housing benefit overpayment department and they say that an amount of £750 is owed from a period of April to July 2010. I never received any payment from them in this period and have all bank statements to prove it, so now I have to appeal. It just seems like a completely disorganised department!

 

ErikaPNP are you sure its recoverable if its an error on their part? I reported my changes in circumstances to all departments and had letters from them saying when my last payments would be. There is an interesting guardian article on it from 2010 which states, "The supreme court ruled today that the government cannot recover overpayments of social security benefits through the courts where the claimant is not at fault. In a landmark judgment, the court declined to accept the government's argument that the Department of Work and Pensions could sue recipients in the county court if they did not pay back overpayments that arose as a result of the department's error."

 

Anyways as I am not living in the UK they cannot get a county court judgement against me and a European Order for Payment excludes social security debt, so I am wondering what route they would have taken if I had just ignored this letter...

[ErikaPNP]

Hi Joool.

 

The article you mention is the supreme court judgment that I am referring to The Child Poverty Action Group (Respondent) v Secretary of State for Work and Pensions (Appellant) - it is only relevant to some benefits, and I'm afraid that housing benefit is not one of them.

 

The Child Poverty Action Group published new guidance for advisors following the judgment. You can read it here

 

I'm sure that the overpayment is recoverable in the event of official error. As I explained above - it's in the housing benefit regulations.