A recent “Focus Report” on Housing Benefit by the Local Government and Social Care Ombudsman has highlighted some examples of error and bad practice in cases brought to them in 2018/19.
Mismanagement of overpayments, and poor responses to revision requests and appeals, feature heavily in the report.
In one case - “David“ had been both underpaid and overpaid HB by the local authority. The underpayment was due to the local authority incorrectly recording his accommodation as two bed (thereby wrongly applying a bedroom tax); the overpayment was due to a delay in adjusting his HB when notified that he had started work. The Ombudsman criticised the local authority for failing to take account of the underlying entitlement in assessing the overpayment amount, for seeking to recover the overpayment from his rent account before it was calculated correctly, and for taking two years to finally sort it all out.
So what is underlying entitlement?
It is the amount of HB the claimant would have been entitled to during the period of the overpayment. The underlying entitlement might even reduce the overpayment to nothing.
Does the claimant need to request this?
Regulation 104 of the HB regulations actually stipulates that HB Offices must consider underlying entitlement – the claimant doesn’t need to ask for it.
But the HB Office can only work out the underlying entitlement if they have the details of the claimants income and personal circumstances during the overpayment period.
It is therefore crucial that the HB Office ask the claimant to provide details of any underlying entitlement and take it into account in calculating how much the claimant has actually been overpaid.
What if the overpayment was caused by the clamant failing to tell the HB Office about a change – and perhaps had committed fraud?
It doesn’t matter.
For example: Charles had been on Income Based JSA, but started work without declaring it, so he was overpaid IB-JSA and HB. When the HB Office found out they asked him to pay back all his HB for the period he was working. But his wages were sufficiently low to entitle him to some HB. The HB Office have to take this into account and reduce the overpayment accordingly.
What if the claimant is struggling to provide the evidence the HB Office need to assess any underlying entitlement?
The normal HB Office rules regarding evidence don’t apply to underlying entitlement, so they can work on minimal evidence.
Even if the HB Office decide the evidence isn’t sufficient, the claimant could go to appeal and the Tribunal will decide on the basis of probability whether, and by how much, the HB overpayment should be reduced by underlying entitlement.
Is there a time limit for asking for underlying entitlement?
No. An overpaid HB claimant can request underlying entitlement be considered at any time, even years later: there is no reference to any time limit in the HB Regulation 104, and the general revision/appeal time limit of one month (extendable to 13 months in some circumstances) only applies to 'decisions' under the Child Support, Pensions and Social Security Act 2000 Schedule 7 (1); as ‘decisions’ on overpayments are actually 'determinations' they don’t fall under these regulations.
Where a HB Office has not applied underlying entitlement to a HB overpayment they can use our Standard Letter TOP1.
What should I do?
Tell any overpaid claimant to inform the HB Office of all their circumstances and income during the overpaid period. You can tell them this in our letters notifying tenants of HB overpayments: TOTOP1 & TOTOP2.
Click here for more information on underlying entitlement and links to the letters.