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Reduced maximum rate at which UC deductions can be made
I was thinking about this while swimming on Friday evening ....
I am at the same time worried about you and laughing out loud.
Swimming provides an excellent opportunity for reflection - I often use it ;)
My point was that s71ZG includes the power to make regulations about how the recoverable amounts are calculated. The POAB Regs don’t do this, so that’s why they’re not listed - because there’s nothing about calculating recoverable amounts. In the other thread you seemed to be arguing that the absence of s71ZG in the introductory text indicated that advances don’t come under s71ZG.
Sorry for the late reply, I’ve been on holiday.
My meaning was, they should have referenced s71ZG(5). This is what is done in the Overpayments regs, which also don’t calculate recoverable amounts. s71ZG(5) would be needed for its reference to s71ZC(1), which allows a benefit to be “prescribed” for making deductions from it.
Your argument then is that a payment on account (if all goes well) is not “recovered”, but merely “brought into account” (which is almost exactly how HB Anorak expressed it in the other thread). And crucially, bringing something into account precludes recovering it. That’s where I am/was uneasy (I can’t decide now, you make a very good argument).
Reg 10(a) is clearly about bringing a payment on account into account, and there is no 40% limit. I can completely agree with that. But the language of Reg 10(b) is different - it talks about the amount being “deducted” from further awards. Doesn’t this sound like recovery?
I’m uncomfortable with the idea that this legislation, taken together, allows a claimant’s SA to be reduced to nothing if it is bringing an advance into account, but limits the total deductions to 40% if an advance is being “recovered” instead. Wouldn’t this mean that my client who took an advance payment in August and then had two payslips counted in her AP and so lost her entitlement, and had to claim again in September, has her advance payment recovery limited to 25%, but if her claim had continued, it would be unlimited? Is that how it’s being treated by the DWP.
I do get what you are saying. In fact, Reg 10(b)(ii) makes me very uncomfortable: if Reg 10 is only about bringing an advance into account, I don’t like the fact that it can be done against a subsequent award of UC. (However, this does answer your argument from the case where the claimant had to reclaim in September.)
It is important to remember that even if you are correct that the recovery is done under s71ZG, that would still not force a 40% limit on an advance recovery. It would only cause such a deduction to be taken into consideration when calculating whether other deductions could be made (see the terms of paragraph 4 of Schedule 6 to the C&P Regs). So, either way, any 40% limit on advance recovery would only be due to DWP discretion.
There is actually one DWP document which supports you - see the footnote to paragraph D1223 in the ADM.
Thank you for humouring me. I hope it isn’t too tiresome, but I find these little excursions - testing understanding and delving into detail - very rewarding.
I would say the exact same thing back to you!
Reading and re reading this and other posts I am still confused! Can someone please clarify.
I understand the maximum for third party deducitons is now capped at 30% of Standard Allowance and only a max of 3 deductions can be made in order of priority (unless, according to guidance link above, last resort deductions)
But does that mean there could also be a deduction for UC Advances, Hardship payments, o/ps, sanction payments on top of this 30%, potentially meaning client could be left with a penny if there are enough deductions?
There is an order of priorities for these but can’t find % amounts for recovery
Advances have been discussed above. They won’t take more than 30%, but they could possibly come on top of any other deductions.
Hardship payments and overpayments are treated like third party deductions (capped at 30%, max of 3 deductions in order of priority).
Sanction/Fraud deductions are taken at either 100% or 40%, and count towards the 30% maximum for third party deductions, so usually no other deduction can be taken. (An exception would be a joint claim where a 40% deduction is made in respect of one claimant. In such a case, only 20% of the full standard allowance will have been deducted).
DWP has reissued its Benefit overpayment recovery: staff guide which confirms at Appendix 4 (Pg 71) -
The maximum amount that can be deducted from Universal Credit is an amount equivalent to 40% however as a matter of policy from October 2019 this is restricted to 30% of the claimant’s Universal Credit Standard Allowance. There are two exceptions to this which are;
• Deductions for normal consumption of utilities do not count towards the 30% maximum
• If a sanction or penalty is being applied, priority deductions i.e. housing and fuel costs, are still taken even if the total amount of deductions is higher than the 30%