Diminishing Capital Calculation

I have a client who has a large overpayment of irESA due to undisclosed capital.  The DWP have just re-calculated the DCC and say they have included the HB paid to the client in the calculation/deduction.  There is a separate HB appeal ongoing for the same issue (undisclosed capital).
Looking at https://www.legislation.gov.uk/uksi/1988/664/regulation/13 I do not think this is correct (not to mention the fact that the client is challenging the HB overpayment anyway so the amount of HB paid may not be correct).

Any thoughts on this would be welcome.

Thanks and happy Christmas!

You are right I think.  There is an HB Commissioner’s decision that makes the same point from the HB end - no provision to factor in overpayments of other benefits when calculating the overpaid HB.

This is in contract to diminishing notional capital, where all the benefits “lost” are aggregated for diminution purposes.

I have to write a Tribunal sub over Christmas and New Year on a case where the claimant allegedly deprived himself of capital before the local authority knew he had it - it all came to light a couple of years later.  So there is both diminishing capital and diminishing notional capital, it’ll probably take me two days to build the spreadsheet, never mind write the sub.

In your case, the risk is that DWP realise their error at some stage and the claimant is told that the overpayment is worse than originally thought.  I don’t think there is anything to stop them revising their decision in this way as official error provides an any time ground for revision.

Many thanks for your reply on this.  I appreciate it.

Your case sounds very challenging!  I hope you got the work done it that you wanted to!