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Debt recovery - what are the current issues?
The Work and Pensions Committee has asked NAWRA to provide up to date evidence on the current problems and issues relating to debt recovery. I am running a workshop at Glasgow NAWRA on 7 September on this issue and will use evidence from there and suggestions for improvement to submit a report to the Committee.
If you cannot make the Glasgow meeting but have issues you want to ensure are included please either put them here or direct message/email me by next Thursday 6 September as we have to submit the report by Monday 10 September.
Thanks.
We’ve received a flurry of enquiries recently where DWP Debt Management refuse to suspend recovery of overpayments despite being provided with clear evidenc e that the client is challenging the decision about the overpayment and despite our advisers sending them a copy of their own guidance which also highlights that they should suspend recovery.
We’ve received a flurry of enquiries recently where DWP Debt Management refuse to suspend recovery of overpayments despite being provided with clear evidenc e that the client is challenging the decision about the overpayment and despite our advisers sending them a copy of their own guidance which also highlights that they should suspend recovery.
Definitely this (and the call handlers being extremely rude about it)...
At a meeting at the jobcentre the local representative dude said that their work coaches were finding it very difficult to get deductions reduced for claimants struggling with the high levels being deducted. Says it all really
Definitely this (and the call handlers being extremely rude about it)...
Yes, we’ve heard about quite rude interactions with the call handlers also.
For anyone who isn’t aware, the guidance I referenced above is here Benefit overpayment recovery: staff guide and the relevant sections really couldn’t be much clearer:
4.5 Where the recovery of the overpayment or penalty has already started, recovery is suspended until the reconsideration has been completed. If recovery action has not yet started, no recovery is made while the reconsideration is outstanding.
4.12 The request from HMCTS is classed as notification to DWP that the claimant has appealed, and where the recovery of the overpayment has already started, recovery is suspended until the Appeal has been completed. If recovery action has not yet started, no recovery is made while the Appeal is outstanding.
Yet as Adele notes, the call handlers apparently respond quite indignantly when this is pointed out to them. Hostile climate anyone?
This is a huge issue that advisers have been trying to raise for some time, glad to hear that there is going to be a NAWRA report on it to the WPC. I will come to the Glasgow workshop and contribute.
I have had run-ins with Debt Mgt about non-suspension when an appeal or MR has been submitted.
First, in the cases it was clear that many front line Debt Mgt staff don’t know the difference between an appeal and an MR.
Second, I was eventually reliably informed that Debt Mgt await an instruction from the office dealing with the dispute to inform them and they will only suspend when told by the office dealing with the MR or appeal.
It seems it is beyond Debt Mgt’s wit to contact another part of DWP when a claimant or rep raises with them directly about suspension. Quite stupid really and it all breaks down when the PS/JCP/DCS don’t tell Debt Mgt that a dispute is ongoing. The presence of a two-stage disputes process doesn’t help.
Also attitudes and manner of Debt Mgt staff leave a lot to be desired. Don’t know whether they are trained to be like this or naturally behave like this outside work.
Second, I was eventually reliably informed that Debt Mgt await an instruction from the office dealing with the dispute to inform them and they will only suspend when told by the office dealing with the MR or appeal.
It seems it is beyond Debt Mgt’s wit to contact another part of DWP when a claimant or rep raises with them directly about suspension. Quite stupid really and it all breaks down when the PS/JCP/DCS don’t tell Debt Mgt that a dispute is ongoing. The presence of a two-stage disputes process doesn’t help.
Yes I’ve had exactly this problem. What really rankled was that we’d even won the appeal by this stage but because JCP were considering whether to appeal to UT (they didn’t in the end) they still hadn’t enacted the Tribunal decision this meant that a letter dropped through the letter box of the client telling them that they either agree a payment plan or Debt Management will go for attachment of earnings or get debt collectors involved.
Naively I assumed some mistake and that this would all be sorted with a simple phone call. But oh no, the reason for the letter was that Debt Management had never been informed of the appeal so as far as they were concerned it was still a live debt. They have no access to any systems that can confirm the ongoing dispute. So then I have to ring JCP to get them to tell Debt Management. A week later ring back to check “No, we can’t see any notification of an appeal”.
It got to the point that we agreed a payment plan that both I and the Debt Management knew would never result in a penny being paid but would buy more time to allow this notification to be received by Debt Management as otherwise there was no way of stopping their system automatically going for attachment of earnings or involving debt collectors (this problem and the solution was explained by multiple agents not just one).
They still haven’t replaced the window pane smashed when my phone went sailing through it after that little exchange.
You’ve probably got these points already but:
The Benefits Overpayment Recovery Guide is now the sole document dealing with UC overpayments as COP1 was withdrawn in October 2017 and was never replaced. There is therefore no public leaflet explaining UC and overpayments in plain language: BORG is 74 pages long.
Most unsupported claimants won’t know about BORG, or about requesting help with hardship or DWP’s discretion to waive overpayments, etc.
We have found that UC overpayment decision letters lack any details whatsoever and in cases so far, UC have refused to disclose any such details - we had to appeal one case just to see how the overpayment had been worked out. It was revised (only slightly) in the claimant’s favour but would never have been revised at all had we not appealed.
It is unjust that UC overpayments are recoverable no matter who caused them - and also that there is no equivalent of HMRC’s COP26. The appeal case mentioned above was caused entirely by internal DWP delay, which they admit in the appeal papers, but it makes no difference.
DWP has so far dragged its feet (over 6 months) in responding to a formal complaint about this case.
It’s also unjust that recovery of UC overpayments is not suspended while there is MR/appeal (BORG p22 and p24), although this is presumably because UC can be sure that an appeal can never succeed.
UC rules put the boot very firmly on the DWP’s foot, and they seem intent on using said boot heavily, on hampering any response from claimants/advisers by refusing to give out information, by making efforts to seek reduction or waiver as hard as possible, and trying hard not to respond to complaints.
No wonder debt recovery are cocky and rude….
Absolutely no information at all provided to claimants about what the debt recovery is for or how the monthly rate was worked out - quite often they are just listed on the statement as ‘debt’.
Nobody bothers to look at how much the claimant will actually be left with at the end of all the deductions and it’s impossible to get the deductions reduced even with evidence showing they are causing hardship to the claimant. Particularly with advanced payments, claimants are only given a set amount of time to repay the debt so even if the rates of repayment are causing them hardship they have no choice but to stick with these rates. I had one client who wasn’t buying food some weeks because she’d been told there was no option to reduce her advanced payment deductions each month.
UC giving instructions to claimants to call them to discuss debts and then telling claimants they have to call the DWP after the claimant has sat on the phone for half an hour - why can’t they just provide the debt recovery team number straight away?
I had one case where a debt was being deducted from the claimant’s UC and when we called debt recovery they had no knowledge of the debt and said it wasn’t even in their system - UC of course refused to discuss this with us because ‘we don’t have the information about the debts, you have to call debt recovery’ - this took absolutely ages to resolve and I don’t think the client would have managed it without my assistance.
One case where UC made a deduction for the same debt twice in one month and while they did eventually pay the client the difference, it of course took ages and multiple angry phone calls from me to get them to do this.
Absolutely no information at all provided to claimants about what the debt recovery is for or how the monthly rate was worked out - quite often they are just listed on the statement as ‘debt’.
All really helpful thanks everyone. Hattie - on the point above - you wouldn’t be able to send me a screen shot of a typical statement showing that would you - really helpful for the committee to see what the claimant gets given. you can direct message/email me if easier.
Just to clarify the suspension of overpayment doesn’t apply to UC according to the Benefits Overpayment Recovery Guide - both under MR and Appeal it says “For Universal Credit overpayments, recovery will not be suspended ” (4.6 and 4.13)
Just to clarify the suspension of overpayment doesn’t apply to UC according to the Benefits Overpayment Recovery Guide - both under MR and Appeal it says “For Universal Credit overpayments, recovery will not be suspended ” (4.6 and 4.13)
Aah - thanks for pointing that out! Though of course doesn’t stop us arguing that they should be!
Just to clarify the suspension of overpayment doesn’t apply to UC according to the Benefits Overpayment Recovery Guide - both under MR and Appeal it says “For Universal Credit overpayments, recovery will not be suspended ” (4.6 and 4.13)
Aah - thanks for pointing that out! Though of course doesn’t stop us arguing that they should be!
Certainly - UC claimants get hammered all ways, the overpayment is always recoverable, and now they won’t even suspend recovery if MR/appeal is put in.
Yet from the case that I raised, an appeal was the only way to get any sensible information out of DWP, and even then the appeal sub didn’t satisfy the judge, who adjourned to ask for a clearer calculation!
The approach of UC appears to be to tell people as little as possible, grab the money and hope that no awkward questions get asked.
UC claimants should at least be entitled to sufficient information to show how and why they were overpaid, and to have a clear calculation showing what was paid, what should have been paid, etc.
Debt management act in a similar way to a commercial debt recovery organisation. They act on the ‘instructions’ of the relevant benefit office. Hence the ‘we can’t do anything unless instucted by [the relevant benefit office]’ response to an enquiry / issue.
But as other recount the revevant benefit office usually respond ‘that’s nothing to do with us you’ll have to contact debt management’ and so the circle of frustration begins!
For UC the additional issue is that everything is supposed to be online through the journal. But debt management cannot access the journal and anything about a debt (reasons, to negotiate a reduced repayment rate etc.) entered on the journal simply brings a response ‘you need to contact debt recovery about that’. In my experience that includes making an MR against a debt issue where the CM replies - ‘you have to make the MR to debt recovery’.
So much for UC as an online only process!
A key question is therefore - why does a reduced rate of repayment have to be negotiated with debt management when, for example, the decision to award a UC advance and the repayment rate is set by the UC CM? Another example of UC systems failure and the ‘nothing to do with us’ attitude of different parts of the DWP (athough debt management staff sometimes state they are not part of the DWP - just acting on their instruction!).