Overpayment recovery rates

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    We have a few queries about overpayment recovery ….

    Some LA’s seem to adopt a blanket recovery rate of £8.70 in all cases … is this lawful?

    Is there an appeal right against the recovery rate?

    How do we challenge the recovery rate if there is no appeal right (as the LA letters suggest)?

    Isnt there any guidance about setting such a high recovery rate for say, someone on IS who cannot afford that (and is probably paying an additional amount for rent arrears)? Whose debt has priority?

    What is the logic behind setting a max reciovery rate of 8.70 – other than to effectively transfer the debt into rent arrears (sometimes this has the advantage of course in that the courts may require a lower recovery for arrears than benefits are setting!!!). Wouldnt it be more sensible to view the 8.70 as the maximum deduction (in total) from all benefits at one time?

    How come someone who gets invoiced for an overpayment can arrange to pay at say £5.00 a week – and they no longer get any HB but someone on HB and IS/JSA/IB is expected to pay at 8.70 a week? Isnt this some kind of victimisation?

    Is this the policy intention of the DWP – that LA’s should set with £8.70?

    Have any LA’s got any local policies that enable a more flexible approach – especially by working with tenancy sustainment officers and more vulnerable clients?

    Any views and thoughts appreciated – especially comments from the DWP


    We are always willing to reduce the recovery rate if asked and the claimant can show that it is causing financial hardship

    We don’t give the right of appeal against the amount of the recovery rate as I don’t think it’s an appealable decision(the o/p itself, of course, is appealable).

    I suppose you could go to the ombudsman if the LA refuses to reduce the recovery rate but I don’t think you would get anywhere as where would be the maladministration.

    Hope this helps.


    If the claimant requests a change in their recovery rate, we get them to complete a means enquiry form and then we will reduce the recovery rate down to as low as £2.85 p/w if it looks like they will struggle. We also liase with our housing department and will reduce it on their say-so without the need for a form.


    We don’t adopt the blanket policy of deducting £8.70 wk from ongoing benefit, we only do this where the clt, having been notified of the o/p, has neither appealed or contacted us to discuss an alternative repayment arrangement. If this causes hardship we will of course reconsider the matter.

    As for a right of appeal, I don’t belive there is one over any decision about how the debt is being recovered, only if it is recoverable.

    The figure of £8.70 itself is the maximum permitted amount that an LA can recover, plus half of any income diregards (unless it is as a result of fraud). Most authorities use this amount as a default one I imagine because of the pressure we are under to maximise our debt recovery.


    The £8.70 is the maximum amount deemed reasonable for someone on IS / JSA and is set by the DWP and the calculation is shown within the HB regs.

    Clearly, different LA’s will have different procedures in place, but the vast majority will have some process for dealing with hardship claims and will look at the persons income and expenditure, to reduce it where it’s appropriate.

    With a person who is no longer on benefit, our weekly repayment amounts will start upwards of that level. Again we will consider allowing lower payments if we are satisfied they cannot afford a higher amount.

    If a tenant has rent arrears and a repayment of that seperate debt is set by the court, then that amount is payable in addition to the ongoing deduction. It bears no relation to the HB dedcution amount. A tenant should therefore not be increasing their level of arrears because they are only paying the amount order by the court, because they are still required to pay the weekly shortfall as well.

    If they can’t pay both, then they need to re-negotiate the HB deductions to an affordable level, so they can pay both.

    Neil K Day


    I agree with Martin & Will’s comments.

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