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Forum Home  →  Discussion  →  Benefits for older people  →  Thread

pension credit overpayment

Alan H
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welfare rights Age UK Northumberland

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In 2008 the DWP mistakenly assumed my client had stopped working. Her Pension credit was consequently increased at that time.  The client’s earnings in 2008 were £27 a week. The client cannot recall any details of changes to her PC in 2008.
In 2014 the DWP spotted the above error and decided that the client has received a recoverable overpayment of pension credit from 2008 to 2014. The DWP now accept that the client in no way contributed to their misunderstanding, that she had ceased work in 2008. A new recoverable overpayment period is now said to cover the period 2009 to 2014. The new material fact that is said to have caused the overpayment is the client’s failure to notify the DWP that she received a yearly increase in her weekly salary between 2009 and 2014. The increase varying between £1 and £1.50 a week.
In this case the DWP are demanding repayment of the PC overpayment due to her failure to inform them of her annual wage increase. They are also demanding that the PC overpaid due to their original misunderstanding in 2008 be repaid for the new overpayment period, 2009 to 2014. My understanding is “for recovery under section 71 of the Admin Act the failure to disclose/misrepresentation must be the cause of the overpayment.” The appeal hearing is set for July and I intend to argue that only the overpayment which can be linked directly to the client’s failure to disclose can be recovered. i.e. the £1 - £1.50 increase. The DWP knew that the client was working during the overpayment period therefore she could not fail to disclose that fact. Any thoughts on the above will be greatly appreciated.
Finally, and for completeness, when the DWP changed the overpayment period, and the basis for recovery, they did not inform the client. She only learned of the change as a consequence of further information posted out by the Tribunal service.

Cheers, Alan

MMiah
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Benefits Department, Crystal Law Solicitors, Leicester

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Did the claimant have an Assessed Income Period (AIP). In a similar case, I contacted the Pension Service and gathered the AIP was for a period that covered the overpayment and therefore the increase had no bearing.

Alan H
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welfare rights Age UK Northumberland

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I don’t know. but why would it be relevant as overpayment relates to earnings?

MMiah
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Benefits Department, Crystal Law Solicitors, Leicester

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It would need to be pension income not general income. 

Is there a (i) superceded entitlement decision for the 2009 - 2014 period and (ii) a consequential overpayment decision notice. 

May seem obvious, but in cases whereby multiple decisions are continuously being made it is not uncommon for the DWP to forget to actually issue and correctly notify the claimant of the superceded entitlement decision.  Without such any overpayment decision is invalid. 

Not got my resources with me atm, but the Social Security Regs have criteria which must be satisfied for what constitutes actual notification to a client.

Alan H
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welfare rights Age UK Northumberland

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thanks for the response. The client did recieve a new PC decision in 2014 explaining a new PC decision had been made resulting in a lower PC award. The reason for reducing her PC entitlement was also explained.

With this appeal I feel the argument rests on what the client failed to disclose. And what overpayment is due to THE client’s failure to disclose. It is this argument I am looking for infor on!

The client failed to notify the DWP of her annual increase in earnings. This was her only failure to disclose. The DWP originally argued that my client had failed to notify them that she was working and earning. This failure has now been dropped by the DWP and they accept that they knew she working. They did, however, pay her PC as someone who was not working for a period of 7 years. The DWP decision that we have appealed is that they want all of the overpayment for the six year period to be paid back by the client. An average of about £18 a week. Approximately £1.50 of that represents her annual (per week) increase. The other £15.50 overpayment arose because the DWP mistakenly decided that the client has ceased work.  The client’s failure may have lead to the £1.50 a week overpayment. It did not cause the £15.50 a week overpayment!

When the DWP mistakenly decided that the client had stopped working, in 2007, they did not notify the client of that decision although obviously her PC went up - by approximately £9 a week.

Unfortunately after today my next day at work is next Thursday. So apologies if I don’t reply to any replies before then.

past caring
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Welfare Rights Adviser - Southwark Law Centre, Peckham

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I think you may struggle with that approach - because the obvious response would be “if she’d in formed us of the increase in earnings, we’d have realised she was working and there then would have been no overpayment at all.”

I’d be more tempted to look at whether or not they are trying to base the failure to disclose on para. (1A) or para (1B) of reg. 32 of the Claims and Payments Regs.

1. - para (1A) - imposes the duty on claimants to inform the Secretary of State of any evidence or information he may require. This one is generally the provision relied on where the SoS is saying there was something specific in the INF4(PC) leaflet which sets out the claimant’s duties as to things they must disclose. In other words, if it’s there in the INF4(PC) in unambiguous terms (and there’s no dispute the the leaflet was provided to the claimant) then there’s an absolute duty to disclose.

Worth thinking about whether the word ‘should’ or ‘must’ is used in regard to the specific disclosure required. Also worth being clear as to whether Pensions Service are relying on a requirment to disclose ‘if you start work’ (she’d informed the PS of her employment and had never stopped - so they’d be stuffed on this one) or of they’re relying on a requirement (and I don’t know because I’ve not got an INF4(PC) to hand) to inform of ‘any increase in earnings/income’. if the latter, then this will be a very difficult hurdle to overcome - there may not be, but I strongly suspect there is.

2. para (1B) - imposes the duty on claimants to disclose changes of circumstance which they might reasonably be expected to know might affect their entitlement. I think there’s a potential argument with this one - a reasonable inference that could have been drawn by your client once her award of PC increased was that her earnings no longer affected her level of entitlement. She’d informed the PS of her work, nothing had changed and her entitlement then increased. Why, then, would any future increase in earnings be relevant?

The really crucial issue, I think, is what was in the INF4(PC) leaflet.

[ Edited: 18 Jun 2015 at 02:33 pm by past caring ]
Jon (CANY)
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Welfare benefits - Craven CAB, North Yorkshire

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If it helps, the INF4(PC) dated 04/09 is scanned here:
http://www.rightsnet.org.uk/forums/viewreply/36120/

It includes, page 4:
“You must report changes about ..
..
- earnings”

page 6:
“Earnings
Tell us if you or your partner:
- start any paid work
- start to earn more or less money
- stop working”

Mike Hughes
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Senior welfare rights officer - Salford City Council Welfare Rights Service

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Cake and eat it spring to mind.

Only one decision can exist for this period so they need to decide which one it is. In order to recover an o/p of PC on the basis of non-declaration of increased earnings they would need to supersede the earlier decision awarding PC on the basis of no earnings. If they haven’t done that they can’t go for the second o/p at all. It doesn’t and cannot exist. If they have then the first no longer exists. Simples 😊

The correct scenario imo would be the second. I have successfully argued against that INF 4 wording and its relevance in the past. There is sufficient ambiguity in the phrase “start to earn more or less money” to suggest it implies a non-routine pay rise or cut. A reasonable person wouldn’t necessarily think that definitely covers inflationary increases. You’re then left with a routine o/p where it comes down to what the claimant knew; ought to have known based on their previous experience and what they actually did.

Alan H
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welfare rights Age UK Northumberland

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Yes, it is a version of ‘cake and eat it’! In this case the DWP have a cake and sent it along to the tribunal service. However, after realising they had used the wrong ingredients the DWP want the tribunal Chairman to put a pinny on, turn the oven on and re-bake the cake to a new recipe! I.E.

The DWP have identified an error with the decision under appeal “...which would result in the decision under appeal being revised advantageously and the appeal would lapse.”. Apparently resulting in (DWP’s opinion) a further appeal being made. “In order to avoid this a suggested corrected decision has been included,,,” in the appeal bundle with the suggestion, from the DWP, that the Tribunal “...substitute the corrected decision against which the appeal was originally made.”

At the present time the only decision that exists, and the one the client has appealed against, is that the client failed to notify the DWP she was working. The DWP now accept that the client did inform them she was working. As far as the client is aware that decision still exists, and has not been superseded. If the DWP have their way, when we walk into the tribunal next week the Chairman will replace the first decision (failure to notify the DWP she was working) and replace it with a decision that the client did not notify the DWP her earnings were subject to a small annual increase. Thus allowing the DWP to claim that PC paid to my client due to a DWP error (of believing the client was not working) should be recovered from the client.

Whilst examining the appeal bundle I have noticed that an AIP for the client ended in 2010 and was replaced with a new AIP for 2010 – 2015. I have tried to find out the details of how an AIP decision is made. E.G. do the DWP contact the client for details of income etc? Unfortunately I have not been successful. I would appreciate any information on this issue. For it seems to me that the DWP would be unlikely to grant an AIP without checking the client’s financial circumstances. 2010 is part of the ‘overpayment’ period.

Alan H
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welfare rights Age UK Northumberland

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I have found the AIP infor on rightstnet e.g. ‘Rapid Review’ process’ and manual review.