Apportionment of student loan - ESA

Hi,
I have a client who it has been decided that she had been overpaid ESA which is recoverable.

The client had interrupted her course and notified the DWP of this fact in March 2020 and that she would not be paid the last part of her student income in April 2020.
The DWP were contacted again and advised that my client would not resume the course until January 2021.
ESA entitlement was reassessed and continued in payment.
The client resumed her course in February 2021 and notified the DWP of this fact and then provided details of her student finance award which was awarded on 08 February 2021.
The DWP then decided, n March 2021 that my client was entitled to a reduced amount of ESA for the period 01/09/2020 to June 2021 because her student loan had to be apportiioned and taken in account for that period.
It is my client’s case that the student loan should be taken into account from when it was actually paid.

I would be grateful for comments and advice.

Rod - 05 June 2023 11:29 AM

It is my client’s case that the student loan should be taken into account from when it was actually paid.

I would be grateful for comments and advice.

Student funding is treated as notional income by DWP. Your client has been treated as if she’s had this income, regardless whether she was actually getting it or not. This is because she could have applied for it even during her periods of suspension of studies.
Once you become a student, you are treated as in receipt of the student income (if personally eligible) until you graduate, abandon or are dismissed from studies. In cases of suspension, otherwise called abbeyance or temporary withdrawal, student income is still available to students in most cases. See here for example https://www.gov.uk/student-finance-if-you-suspend-or-leave
See also ADM H6115
Your client could apply to her university’s hardship fund to get help if the ESA overpayment is causing her financial hardship which impacts on her ability to graduate.

This is of course apart from the action which you can now take, to challenge the recoverability of the o/payment, seeing as client did all she could to notify and did not contribute to the mistake which was solely on part of DWP. Client is not likely to have known that she is getting incorrect money, seeing the complexity of interaction between the benefit system and student funding