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Forum Home  →  Discussion  →  Other areas of social welfare law  →  Thread

No more negotiations re. deductions if overpayment due to ‘Fraud’

JP 007
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During a phone call from Debt management I was advised that new legislation had gone through in November 2014r regarding Fraud debt recovery which stated that there is to be no reductions in deductions for Fraudulent Overpayments and they are set at £18.25 p/w for ESA, JSA etc.  and 1/3rd of any Disability-Non means tested Bens/Wages.
I was looking for this amendment and was told it is in DM Bulletin 342 but I can’t find it….......Help!

Daphne
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Ive checked Regulation 16 of the Social Security (PAOR) Regs - http://lawvolumes.dwp.gov.uk/docs/a1-6519.pdf - and there has been no update as far as I can see - para 4(a) says up to the maximum specified in para 5 which says 25% of personal allowance. But it is only ‘up to’ that amount so I cannot see anything that says reductions are prohibited. i would go back and ask for legislation - guidance is not the law

JP 007
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Thanks Daphne,
‘If it dosn’t exist you cant find it’ will be the maxim of the day.
JP

LF
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I today have had the same conversation with Debt Management no negotiation for fraud cases as law changed in Dec 2014 she couldn’t quote the relevant law to me and said only exceptions people with children or if I could prove additional expenditure due to health problems.  So if anyone does come across the relevant change in the law that would be great.

thanks

Daphne
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I will ask operational stakeholders for the legislation - if they’re operating a policy they need to be able to demonstrate the legislation to back it up - I’ve looked and I can’t find any amendments.

LF
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Thanks Daphne

LF
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This is the letter back from Debt Management no negotiation on recovery of admitted fraud cases Ministerial Announcement on 3rd November 2014

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Edmund Shepherd
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It appears to be from the SoS, too:

http://www.iainduncansmith.org.uk/content/work-and-pensions-questions-9

[ Edited: 9 Mar 2015 at 01:13 pm by Edmund Shepherd ]
JP 007
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Hay LF thanks for sharing this but have you covered the Header on this letter for some reason? If you did want to call back it may be hard to do so without a number! The Law by Ministerial Announcement!!!!!! Sections of society excluded from the mitigation of poverty?

LF
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Hi JP007 just covered the top as included all my client’s details.  Letter from Debt Management Mitcheldean with usual address and contact details.

JP 007
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‘‘The Secretary of State for Work and Pensions (Mr Iain Duncan Smith): Today, I welcome the tougher action my Department has taken to recoup debt and safeguard taxpayers’ money. Now, where overpayments result from benefit fraud, the Department will always recover the maximum amount in legislation, ending concessions that previously meant that people paid back less, and making exceptions only where children will be affected.’‘

IDS confused again, These are Reductions in repayments due to financial hardship not Concessions!!

Daphne
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THat seems to be like a blanket policy fettering their discretion to reduce repayments - as JP007 says they can’t just change the law by announcement. The regulations clearly give discretion to reduce by ‘up to an amount’ - I will go back to operational stakeholders. Maybe a JR is needed?

1964
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Daphne - 09 March 2015 01:20 PM

THat seems to be like a blanket policy fettering their discretion to reduce repayments - as JP007 says they can’t just change the law by announcement. The regulations clearly give discretion to reduce by ‘up to an amount’ - I will go back to operational stakeholders. Maybe a JR is needed?

I agree Daphne….it’ll be needed because you just know the debt management office will refuse to budge otherwise.

Daphne
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Having chased I have now received a reply by operational stakeholders which says -

On 3rd November 2014 the Secretary of State announced that benefit debtors with a Fraud classified debt or debts would no longer have access to a reduced rate of deduction for the recovery of the related debt/s except in exceptional circumstances and only if they have a dependant child/children. 

Following the Ministerial announcement, staff in the Debt Centres were made aware of the changes to the negotiation framework and a bulletin was issued to assist them in explaining why we cannot reduce the rate of deduction from benefit in these cases. We apologise if this has not been evident in the responses received. We will ensure that this is followed up.

This change came about by Ministerial announcement and I can confirm that there is no change to the legislation which provides for the discretional element in the rate of deduction. Staff have been issued with guidance on the ‘exceptional circumstances’ in which a reduction may be considered and the scenarios they may encounter when dealing with such requests.”

So they should not be applying a blanket policy - there is still scope for reduction in exceptional circumstances or where there is a dependant child. I have gone back asking for a copy of the staff guidance - though going on their track record it might end up being a FOI request!

Gareth Morgan
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Daphne - 26 March 2015 10:48 AM

“except in exceptional circumstances and only if they have a dependant child/children.” 

  there is still scope for reduction in exceptional circumstances or where there is a dependant child.

Daphne, is this ‘and’ as they say or ‘or’ ?

 

Daphne
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good point Gareth - if it is and then surely that is a blanket policy - will raise that with them too

Daphne
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response from operational stakeholders -

At present “Exceptional Circumstances” are not clearly defined, there is no ministerial steer for this, and our agents may need to seek Policy advice on this on a case by case basis, there is then by definition no blanket ban on discretion where care for children is not involved. We expect to define “exceptional” as we develop an idea of what that actually means in practice. Our agents will know what we would normally accept under other hardship claims, a quite tight definition as it is, and so will have some experience of what is or is not “usual”.

I have been advised that we cannot share the guidance externally.

I will do a FOI request for the guidance…

LF
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Thanks Daphne for chasing this up and your updates

Linda

Daphne
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Response of FOI request attached below - generally it seems they will only negotiate in fraud cases if you have a dependant child although they just about avoid fettering discretion by suggesting a few other scenarios that might be included…

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Paul_Treloar_CPAG
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Debtors with a Fraud overpayment or potential prosecution who are currently repaying at less than the maximum amount will be reviewed over the next six months to see if these repayments can increase.

One suspects that advice centres are going to be seeing a steep increase in clients asking why their repayments have shot up over the next few months.

JP 007
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The repayment negotiation framework (RNF) concentrates on those with dependant children but does cover Debtor with suicidal tendencies’, serious health issues with extra expenses, carers responsibilities, home/employment at risk and other circumstances.
It would appear that IDS saw a vote winner in getting tough on ‘Benefit Cheats’ the guidance does seem provide some negotiation though.
In my experience the ‘accidental fraudulent claiments’
(see http://www.rightsnet.org.uk/forums/viewthread/8038/)are so traumatised by the whole process of prosecution and then put in penury for the foreseeable future by these deductions that the risks of suicide or self harm are all too real.

Thanks for getting this Daphne.

[ Edited: 13 May 2015 at 12:57 pm by JP 007 ]