State Pension Underpayment

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  • #285601
    liffe
    Participant

    We have a case where the customer has had her State pension revised back to 2007 and received over £60,000 in arrears due. Searchlight confirms it was a case that missed a conversion scan and was part of the LEAP exercise

    Has anyone else had any of these cases?

    #285608
    pbirks
    Participant

    no – but what a wonderful Christmas pressie for her!!!

    #285619
    helevans
    Participant

    Hello – yes, we have had a couple – some eyewatering arrears payments made!

    #285620
    John Boxall
    Participant

    Just think though of those who were owed money and are either now dead or no longer able to benefit from it as they are to frail or unwell.

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #285697
    NickStrowbridge
    Participant

    How have benefits team been handling these cases? The regs seem to suggest the underpayment must be treated as income for the period concerned, but the capital may be disregarded if it is the result of official error.

    #285698
    Peter Barker
    Keymaster

    The capital is not disregarded. The capital disregard only applies to arrears of means tested benefits; of PIP and equivalent benefits; and in certain circumstances ESA(c)

    While the income is applied retrospectively, this is just a paper exercise because any HB overpayment is DWP official error and it is difficult to see how it could ever be recoverable. The subsidy rate is 100%. But that leaves the claimant with a significant amount of capital which there is no provision to disregard.

    See paragraphs 21 and 22 of Schedule 6 to the HB9SPC) Regs, in particular the definition of the term “benefit” in para 21(2) and of “relevant benefit” in para 22(4). Note that “relevant benefit” does not have its usual meaning here and is defined in a way that excludes SRP.

    #285700
    NickStrowbridge
    Participant

    Thanks for clarifying! I must have misread the regs guide.

    #285706
    liffe
    Participant

    We have looked at LAWD3 2023 which only states to treat the arrears paid as capital, no mention of income?? As quoted below.

    ‘Effect on Housing Benefit
    3. There are no changes to Housing Benefit (HB) regulations to disregard the arrears payments of State Pension and these payments are capital. Entitlement to HB will be affected if the claimant already has capital between £10,000 and £16,000 where the arrears payment takes them above £16,000.’

    #285802
    liffe
    Participant

    Hi,

    Those of you who have has these cases, can you confirm how you dealt with them please.

    Is the income treated for the period it covered? If so, is the overpayment of HB treated as DWP error?

    Or, is the arrears payment of RP just treated as capital?

    #285803
    Peter Barker
    Keymaster

    It’s income for the historic period it covers, and then capital from the point of payment onwards. But these are definitely DWP error overpayments and non-recoverable with 100% subsidy.

    #285807
    John Boxall
    Participant

    Peter, its a Win Win then for the claimant

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #285808
    Peter Barker
    Keymaster

    Well, except they aren’t entitled to means tested benefit any more of course, but given the choice I’d take the capital!

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