Client sent his wage slip to LA following increase in earnings. This was a pretty standard wage slip with all deductions for NI and Tax clearly shown.
LA re-assessed the claim and the award fell from £137 pw to £0.50 per week. Client came to me in shock as his wage increase was slight. I have realised that the LA used gross earning for their calculations. I wrote to them thinking it's a simple mistake and can be sorted easily. LA responded that they have checked the calculations and that their decision stands. I wrote again and send client's next pay slip. LA wrote back saying that they "confirm that the assessment used gross earnings in order to make a speedy assessment and not delay the claim". They have now assessed on the net earnings and there is an underpayment.
I have tried to find the regs or section of the manual they have relied on to use gross earnings to speed their assessment but I can't. Is my client being fobbed off or am I missing something?

I'm laughing, but for all the wrong reasons.

There is no such reg. There is no provision for a "speedy assessment". Payments on account can only be made for claims; not changes in circs. Your client is being fobbed off. You are not missing something,

HB/CTB regs are explicit - tax and NI must be deducted.

This appears to be the classic "stats are more important than doing the right thing" scenario.

What can you do? In practice, very little, If you complain or appeal, the LA does what it did - just corrects it. Alternatively, the LA could have suspended payment in any case and there is no right of appeal against suspension (only recourse is Judicial Review).

If you get a further example of that practice from the LA, you *could* complain with a view to seeing it through to the Ombudsman on the grounds the LA has a policy of deliberately failing to apply the law. But, how much interest the LGO would have where matters are ultimately corrected is open to debate.

thank you Kevin. I had an inlinking but wanted to make absolutely sure before I do something about it. I am still too soft and righteous and lack a healthy dose of cynicism- so I will complain because if they did this once, I am sure they did it hundred times and there was no one to call them out.