Deductions for overpayments and short term advances from UC personal allowance

SS (Overpayments and Recovery) Regs 2013, Reg 11
Basically say that the usual deduction is a maximum of 15% (can be 40% if fraud, hardship payments);
Short Term Advance payments of benefit

The word ‘maximum’ implies that there is discretion for it to be lower - does anyone know if this is the case, I am told that the form that landlords complete to have rent arrears paid to them are set at 20% unless there are other deductions / debts and then it reduces to 10%.

Also the recovery of the advance payment of benefit at 15% is resulting in claimants have a significant shortfall between their outgoings and income.

Thanks

Scroll down to the bottom of this page Universal Credit Advances for CPAG view on challenging recovery rates.

Where someone owes a tax credit overpayment, and moves on to UC and gets an advance, is it correct that the advance and the HMRC debt can be both deducted at their normal rates? We have a case where 15% for the HMRC debt, plus about 18% for STBA repayment, doesn’t leave much to live on.

CPAG p1161, and also the page linked above, says for advances that the same method of recovery should be used as for recovering overpayments. Does this mean there should be a global 15% cap on the combined recovery rate?

That would seem to follow from the regs, but it’s not what DWP are doing.

Reg 11 of the SS(OR) regs, as noted in the initial post, sets the rate. UC guidance says advance payments should be recoverable at 40%. Why would it not be limited to 15% by reg 11? Is it because a STBA is seen as a “hardship payment” rather than an “advance payment”?

In practice I’m thinking of a request to set recovery of one of the amounts to nil until the other is repaid, but should they be allow to recover both concurrently at 15% or more each in the first place?

Are advance payments repayments included in the 40% limit on priority deductions or on top of this?

If someone already has deductions from IS for example, are these included when working out the repayment cap for the advance payment and therefore limit the amount of the advance you can get?

According to para 4(2)(d) of Schedule 6 to the Claims and Payments Regs, the limit on third party deductions is eaten into by recovery of a payment on account.  “Payment on account” is the legal name for a short term advance: see s5(1)(r) of the Social Security Administration Act 1992 and the introductory text to the Social Security (Payment on Account of Benefit) Regs 2013 which cites s5(1)(r) as the power under which the Regs are made. So yes, recovery of short term advances counts towards the 40% limit.

Thanks for that. I was confused because recovery of advances doesn’t seem to appear in Sched 6 list of order of priorities.
So, what “priority” would an advance take for someone who needs a 50% advance as they move from IS to UC but currently have a number of deductions from their IS?

Sorry, meant to say Schedule 6, not 7 (amended in post above).

Priority for recovery of short term advance?  I don’t think it is part of the hierarchy at all.  The priority hierarchy is concerned with payment to third parties, which a recovered STBA is not.  The only interaction between short term advances and third party payments as far as I can see is that it isn’t possible to make third party deductions at all, or as much, if an STBA is being recovered.  On a practical level I suppose that gives STBA recovery priority.  I cannot see anything that stops an STBA from being recovered at whatever rate the DWP thinks fit - the prior existence of third party payments would not stop DWP from clawing back an STBA, but clawing back the STBA would stop or reduce the third party deductions.  But then again, DWP could say “these third party debts are more important right now so lets ease off on the STBA clawback” - they seem to have complete discretion overt that.

P.S. actually, looking at Reg 11 of the Overpayment Recovery Regs, clawing back STBA is subject to para 4 of Schedule 6 to the C&P Regs, so each is subject to the other.  I guess it’s first come first served, but DWP has discretion to stop/reduce either one to accommodate the other

Thanks - I now feel assured that my confusion was technically correct