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DHP suspended following Benefit Cap appeal

adele
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Social inclusion unit - Swansea Council

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I’ve taken a call from a support worker whose client has had her DHP (nearly £40 per week) suspended following a request for an appeal against the application of the Benefit Cap. The HB section has stated in a letter that this will be case until her appeal is decided (obviously we’re all waiting to know what will happen). We’ve advised on a few Benefit Cap appeals and this is the first time I’m aware of that the HB section has done this. The only thing of some use I’ve found is this section of the guidance to local authorities on the Benefit Cap and awarding DHPs:

1.20 There may be circumstances when DHP is awarded and a subsequent
successful application for an exempting benefit that is awarded
retrospectively means the HB is paid again. The Department recommends
that when deciding whether it is reasonable to make a DHP your LA
considers the risk of eviction if arrears arise that may subsequently be
covered by HB. For example, the risk may be very low for LA tenants and
low for others with a good payment record but less so for claimants renting
in the private sector.

Does anyone have any thoughts/ experience of this?

andyrichards
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I would have thought it would depend on the grounds for the appeal.  If it’s a reasonably straightforward case of the cap being wrongly applied when the claimant should be exempt, then I could see why they might suspend.  But even then they should assess the risk to the tenant.  If it is rather more obscure and has little real chance of success then I think they should leave the DHP in place.

Stainsby
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Welfare rights adviser - Plumstead Community Law Centre

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I am involved in an appeal that depends on the outcome of R (on the application of DA) and Others v SSWP [2017] EWHC 1446 (Admin), so it will be a protracted appeal.

My client has a DHP in the meantime that has thankfully not been suspended.  It if was I would be looking at a JR because there would then be a shortfall that she could not meet , in other words she still needs extra help with housing costs, so still meets the criteria for a DHP award.

LA’s often seem to be under the impression that a retrospective award of HB, or any other benefit thus “creates” an overpayment of the DHP, but it does not.

There is nothing in the Discretionary Financial Assistance Regulations 2001 that is equivalent to Regulation 79(6)-(8) of the HB Regulations which provides:

(6) Where the change of circumstances is that income, or an increase in the amount of income, other than a benefit or an increase in the amount of a benefit under the Act, or Part 4 of the 2012 Act is paid in respect of a past period and there was no entitlement to income of that amount during that period, the change of circumstances shall take effect from the first day on which such income, had it been paid in that period at intervals appropriate to that income, would have fallen to be taken into account for the purposes of these Regulations.

(7) Without prejudice to paragraph (6), where the change of circumstances is the payment of income, or arrears of income, in respect of a past period, the change of circumstances shall take effect from the first day on which such income, had it been timeously paid in that period at intervals appropriate to that income, would have fallen to be taken into account for the purposes of these Regulations.

(8) Subject to paragraph (9), where a change of circumstances occurs which has
the effect of bringing entitlement to an end it shall take effect on the first day of the benefit week following the benefit week in which that change actually occurs except in a case where a person is liable to make payments, which fall due on a daily basis, in which case that change shall take effect on the day on which it actually occurs

The HB Regulations deem a retrospective payment of income to have been paid at an earlier date than it was actually paid, but there is no such deeming provision in the DFA Regs.  This means that a retrospective payment of HB is simply a capital windfall for the claimant, and will not retrospectively affect the DHP award. 

If the client wins the HB appeal, there can be a review of the DHP award at that time, but it is premature to review the award now,

DFA Regulation 8(1) may provide that the LA can review an award at any time and in circumstances as it thinks fit, but appealing against the LA’s HB decision is not a change of circumstances and it is arguable that reviewing the DHP award on receipt of an HB appeal is a punitive measure by the LA which undermines the right to a fair hearing.

[ Edited: 25 Jul 2018 at 03:42 pm by Stainsby ]
Elliot Kent
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Stainsby - 23 July 2018 03:09 PM

LA’s often seem to be under the impression that a retrospective award of HB, or any other benefit thus “creates” an overpayment of the DHP, but it does not.

This is the inverse though, isn’t it? The Council has recognised that if it loses the appeal, it would need to pay the HB and would be unable to recover the DHP - leaving the claimant with a windfall. It can avoid that windfall is by refusing DHP - then if the claimant wins the appeal, they get HB and if they lose, DHP can be awarded for the past period.

Whether that’s a permissible way to go about making decisions, I don’t know - but there is at least a logic to it.

adele
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Thanks all. JD threat is what I was thinking if simple negotiation wasn’t going to get us anywhere.

Stainsby
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Elliot Kent - 23 July 2018 09:10 PM
Stainsby - 23 July 2018 03:09 PM

LA’s often seem to be under the impression that a retrospective award of HB, or any other benefit thus “creates” an overpayment of the DHP, but it does not.

This is the inverse though, isn’t it? The Council has recognised that if it loses the appeal, it would need to pay the HB and would be unable to recover the DHP - leaving the claimant with a windfall. It can avoid that windfall is by refusing DHP - then if the claimant wins the appeal, they get HB and if they lose, DHP can be awarded for the past period.

Whether that’s a permissible way to go about making decisions, I don’t know - but there is at least a logic to it.

I don’t think it’s a permissible way to go about making decisions, because it creates an ever present threat of legal action by the landlord, possibly leading to eviction.  Any doubt as to whether such a threat is real must be completely dispelled by what the Court of Appeal held in North British HA v Matthews [2004] EWCA Civ 1736.  The Court held at [32]

32. On behalf of the respondents it is submitted that, even in such cases, there is no power to grant an adjournment: the principle that an adjournment may not be granted for the purpose of enabling a tenant to pay off sufficient arrears to defeat the claim for possession is absolute. But the power to adjourn before the court is satisfied that the landlord is entitled to possession has not been abrogated by the Housing Act. Parliament could have insisted that the power to adjourn should never be exercised if the sole reason for the adjournment is to enable the tenant to reduce arrears of rent below the ground 8 threshold and thereby defeat the claim for possession. It chose not to do so. Subject to the effect of section 9(6), therefore, the jurisdiction to grant adjournments remains. We acknowledge therefore, that, although there are powerful arguments in favour of the absolute principle contended for by the respondents, there may occasionally be circumstances where the refusal of an adjournment would be considered to be outrageously unjust by any fair-minded person. We hold that the power to adjourn a hearing date for the purpose of enabling a tenant to reduce the arrears to below the ground 8 threshold may only be exercised in exceptional circumstances.  Cases such as those to which we have referred in para 31 above might fall into this category.  But the fact that the arrears are attributable to maladministration on the part of the housing benefit authority is not an exceptional circumstance.  It is a sad feature of contemporary life that housing benefit problems are widespread. To a substantial extent, these are no doubt the product of lack of resources.  But we do not consider that the non-receipt of housing benefit can, of itself, amount to exceptional circumstances which would justify the exercise of the power to adjourn so as to enable the tenant to defeat the claim. 

 

[ Edited: 25 Jul 2018 at 03:43 pm by Stainsby ]