Terms & Conditions

[Kevin D]

[b:9aaadd0a15]CH/1389/2006[/b:9aaadd0a15] – (Information Issue 08/06). The relevant extract is reproduced in full at the end of this post (full CD on HBINFO soon).

I’ve wondered about this for a while. If there is an “overpayment” for a payment on account, is it always recoverable?

In the CD cited above, Cmmr Turnbull clearly envisages that if the o/p is caused by official error, it is subject to the same rules an any other overpayment [b:9aaadd0a15](para 6)[/b:9aaadd0a15].

[b:9aaadd0a15]HBR 93(2)[/b:9aaadd0a15] requires that any notification of a POA [u:9aaadd0a15]shall[/u:9aaadd0a15] contain a notice that any “overpayment” [u:9aaadd0a15]will[/u:9aaadd0a15] be recoverable (from the payee).

Trouble is, nothing in [b:9aaadd0a15]HBR 100[/b:9aaadd0a15] supports this. Any views?

——————[b:9aaadd0a15]Para 6[/b:9aaadd0a15]—————-
Although I give no directions to the new tribunal in relation to the merits of the case, I have very considerable doubt whether any of the overpayments made in respect of the period before about 9 May 2004 could in any event properly be held recoverable. As I understand it a payment on account, in respect of the period up to about 14 April 2004, was made on that date, under the terms of a letter of that date, which stated that a payment on account was being made pending a rent officer’s valuation. That letter did not, as far as I can see, contain any information from which it could be argued that the Claimant ought to have realised that a mistake had been made by the Council. As I see it at present, the earliest moment from which it could even be argued that the Claimant ought to have realised that a mistake had been made was when he received the letters of 8 May 2004 explaining how the housing benefit had been calculated. In respect of the period from about 9 May 2004 onwards the issue will be whether the Claimant could reasonably have been expected to realise, from the information contained in those letters, that his entitlement had been wrongly calculated.
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[Anonymous]

Looks like you’ve stumbled across a contradiction in the regs here Kevin. Is it another of those things that everyone has always done but doesn’t appear to be correct?

Reg 93(2) as you say states “shall” and “will” but Reg 99 defines an overpayment as:

Meaning of overpayment
99. In this Part, “overpayment” means any amount which has been paid by way of housing benefit and to which there was no entitlement under these Regulations (whether on the initial decision as subsequently revised or further revised) [b:17bf80ec62]and includes any amount paid on account under regulation 93 [/b:17bf80ec62](payment on account of a rent allowance) which is in excess of the entitlement to housing benefit as subsequently decided.

If the definition stopped after “no entitlement under these regulations” then 93(2) would be fine as a payment on account is not a decision as to entitlement. However it continues to include “any amount paid on account” which, it could be argued groups a POA overpayment the same as any other overpayment.

As any overpayment is recoverable (Reg 100) except those caused by official error etc, then there could be an argument for saying that a payment on account which is later found to be an overpayment caused by official error, is not always recoverable.

[Anonymous]

I have wondered about this as well. Reg 99 quite clearly includes a payment on account in the definition of an overpayment for the purposes of Reg 100 et seq:

“In this Part, “overpayment” means any amount which has been paid by way of housing benefit and to which there was no entitlement under these Regulations (whether on the initial decision or as subsequently revised or superseded or further revised or superseded) and includes any amount paid on account under regulation 93 (payment on account of a rent allowance) which is in excess of the entitlement to housing benefit as subsequently decided”

– that gives a lot of support to the view that an overpayment on account is subject to the same official error rules as any other overpayment.

Section 75(2) of the Administration Act says that Regs may require an authority to recover an overpayment in prescribed circumstances. The commentary in Findlay assumes that Reg 93(2) and (3) are made under that subsection; but it is possible to argue that these paragraphs only apply in so far as an overpayment is recoverable in the first place under Reg 100. I can see both sides of this one and I think it will make for an interesting Commissioner’s decision one of these days.

[petedavies]

Just to try to confuse matters a wee bit further…

I think that it has to be interpreted in a way which will provide a right of appeal, otherwise it will fall foul of HRA?

I do not think that this was the intent but still…

I also think that the test on recoverability should be a far more stringent one than arising from a revision/supersesion decision:

1) A PoA must be for such amount as the L.A. considers “reasonable” i.e. it is an estimate. Although the L.A. must “have regard” to the other factors I do not think that this can be equated with making decisions. If I am correct here, to show a PoA as being due to official error, in addition to the other tests, the payment itself would have to be unreasonably high in the context of the information available at the time.

2) The term “any notice” in R100(2) should, I suspect, include to the decision notice – this is the first point at which the content of the notice regarding the payment is prescribed. If this is the case then, so long as the initial decision notice provides sufficient information I cannot see how there can be no “reasonable” expectation.

In short, I think that there is a right of appeal but that a far harder test is to be applied.

[Author]

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