Reply To: Underlying entitlement following change of address

Julian Hobson

I’m pleased that this discussion has come up again. DWP are considering amendments to the regs to support the view that Peter (and I) hold. Following the announcement at the IRRV conference in february I sent the following to DWP (sorry about the length of this).

[i:012ff27c83][b:012ff27c83]Non Residency/ Change of address[/b:012ff27c83]

The problem as I understand it is that DWP is of the opinion that a late notified change of address ends entitlement to HB creating an overpayment for which there is no facility to offset against any underlying entitlement.

This view appears to have been formed because of:

(1) the provision in regulation 104(1)(c) excluding change of address from the circumstances when underlying entitlement is appropriate; and,
(2) the view that the end of a liability to pay rent in respect of the dwelling for which HB had been paid, brings HB to an end requiring a new claim to be made in respect of any new liability.

This appears to be the basis for the guidance set out in sections 3.61 to 3.75 of the DWP Overpayments Guide.

It is my proposition that the guidance is wrong and that the provision in reg 104(1)(c) is unnecessary.

Section 130(1) of the Social Security Contributions and Benefits Act 1992 sets out the basic conditions of entitlement to HB. The main condition is

‘(1) A person is entitled to housing benefit if – he is liable to make payments in
respect of a dwelling in Great Britain which he occupies as his home.’

The idea that that a change of address necessarily means that the provision is no longer satisfied is clearly wrong. The provision talks about “liable to make payments in respect of a dwelling”, that means that as long as the customer liable to make payments in respect of any dwelling the basic conditions continues to be met. The condition would only cease to be met in cases where there was no ongoing liability.

A change of address is a change of circumstances and the only provisions that would now come into play are those that deal with changes of circumstances. Those provisions are perfectly adequate for dealing with any change regardless of when it was notified. There would be no circumstance under which the provision of regulation 104(1)(C) would come into play.

Perhaps it would be useful to consider three examples.

1. Following a residency check it is found that a customer ceased to occupy the property 3 months ago. At this stage no further information is known. The authority will supersede the award from the Monday following the date occupancy ceased and create an overpayment. There is no provision to consider underlying entitlement because of 104(1)(c) and the gross overpayment can be notified, even had it been required that the LA calculate underlying entitlement it would have been Zero.
2. Three months have passed since the customer changed address and yet they have only just notified the authority. The rent in respect of property A was £100 and the rent in respect of property B is £110. Because the customer was receiving LHA there entitlement for both properties is £95.00.

The provision in s130 of the act still applies because they continue to have a liability, it is not a requirement of the act that a single liability continues. Were that the case no change of address would be a change of circumstances regardless of how prompt the customer reported it.

The only provisions that apply here are those relating to a change of circumstances. Had the customer benefited from the change in that the award would have increased then the authority will decide that the increase will only take effect from the date of notification unless there are mitigating circumstances.

3. It is possible that a third scenario might come into play where the original decision to end entitlement as in example 1 might have been different if we had known at the time that the customer did have a continuing liability albeit at a different address.

DWP reminded authorities in A16/2008 para’s 21 to 26 that it is possible to revise a decision to terminate entitlement.

This provision is perfectly capable of being used to reinstate entitlement in cases like these. Authorities should reinstate entitlement by revising their decision to terminate in such cases. The decision to terminate was based on a mistake as to the customers actual circumstances because the authority believed that s130 was no longer satisfied, If it is subsequently shown that s 130 was satisfied throughout then the decision to terminate must be revised.

I have tried to think of circumstances when the use of these provisions might be likely to present other difficulties and I can think of none.

There are of course issues around any overpayment that might be deemed recoverable and in some cases the target for recovery. None of those issues will impact on the way the overpayment is calculated. [/i:012ff27c83]

That prompted a telephone conversation with Jane Autherson where we discussed whether s130 of the act was a barrier. The following was my written reply to that.

[i:012ff27c83][b:012ff27c83]Overpayments and s130 of the act.[/b:012ff27c83]

Assuming that s130 of the act doesn’t require a single liability to be continuous or a single occupancy to be continuous in order for benefit to continue, the following might apply.

Before looking at the most simple examples it might be useful to consider the most complex.

A customer moves from property A to property B and requests benefit in respect of both properties because of an unavoidable dual liability. Because of the customers circumstances they are considered vulnerable and using the LA’s safeguard policy payment is to be made to both Landlords rather than the customer. The first notification of the change occurs 9 weeks after the change occurred.

On receipt of the notified change of circs the authority has to decide when it is effective from. The LHA rate applicable changes as a result of the change of address and is potentially more beneficial Reg 13C(2)(iii) and 13D(1)(a).

Reg 79 determines the date that a change of circumstances is effective. In this case notwithstanding that there is a change of address and landlord there is also a change in the amount of the rental liability and a change in the LHA rate payable these are distinct changes and need to be considered separately. Reg 79 and Reg 8 (D&A) determine the effective dates.

The only change here that might be advantageous to the customer is the change in LHA rate arising from the move and not the move itself.

All of the changes were reported outside of the month allowed by reg 8(3) of the D&A regs, only those not beneficial would be effected from the date of change unless the LA accepted that there was good reason under reg 9. For the purposes of this example we shall say there was good reason arising from the customers vulnerability.

HB award at address A = £120.00 per week
LHA rate applicable at address A = £120.00 per week
Rent at address A = £130.00 per week

Moved 05/01/09 from address A to Address B.

Change notified 09/03/09

Tenancy on Address A ended 01/02/09
Tenancy on Address B started 05/01/09

Benefit on two homes requested due to unavoidable liability.

Rent at address B £120.00
LHA rate applicable at address B £118.50
HB award at address B = 118.50

[b:012ff27c83]Are there any overpayments ? [/b:012ff27c83]

Yes. Reg 99 defines an OP as any HB to which there was no entitlement. HB in respect of Address A either comes to an end on the day of the move, 05/01/09 or will run to 01/02/09 if the unavoidable liability is accepted. In this case it is accepted and therefore benefit comes to an end for that property on 01/02/09. Landlord A was however paid upto and including 01/03/09 which means he is overpaid from 02/02/09 to 01/03/09 = 4 weeks at £120.00 = £480.00 the La decide it is recoverable from him.

The new L/L is entitled to receive payment in respect of the new occupancy and will receive payment of £118.50 from the start of the tenancy.

Reg 104(1)(c) works to ensure that the new entitlement is not deducted from the overpayment.

Reg 102(1A) works to ensure that had a decision been made to recover the overpayment from the claimant rather than landlord A it could have been recovered from any sum due in respect of the new property.

[b:012ff27c83]S130 of the act [/b:012ff27c83]

S130 does come into play here but it does not end the award s130 simply recognises that there is continuous liability and occupancy and that in order for the overlapping provisions to work there would need to be a provision to recognise liability where there was no occupancy. That is achieved through s137 (2)(h) and reg 7 of the HB regs that is the product of it.

There is no need for any new provision here. If the issue relates to whether subsidy is properly payable in respect of the overpayment and the new entitlement then I would say it is, simply because we have properly identified both.

If any provision is lacking or unclear it is those provisions in 104(1)(c) and 102(1A), the combined effect of which is to ensure subsidy is payable in respect of over and overpayments covering the same period.

I don’t think this issue is anything to do with the HB Regs and can quite easily be resolved by amendment to the subsidy order. [/i:012ff27c83]

I’d be interested as to whether you agree with what i have put to DWP ?