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Forum Home  →  Discussion  →  Covid-19 issues  →  Thread

Ending third party debt deductions before debt is cleared

HB Anorak
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Anyone heard of a recently introduced policy to stop third party debt payments, or perhaps just specifically rent arrears payments, if earnings exceed the work allowance for three months?  This is different from not commencing/recommencing deductions where the previous month’s earnings exceeded the allowance - this concerns an established deduction arrangement coming to an end.

Thanks

Elliot Kent
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I think this is the same issue as raised here Peter?

https://www.rightsnet.org.uk/forums/viewthread/16361

All very interesting - I wonder if anything came from the GMWRAG meeting…

HB Anorak
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Aaargh!!!  I was looking at the wrong paragraph - oops!

Thanks for that

Coastal
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Yes as previously raised by Tai Tarian its happening a lot now, several social landords in Wales have raised this with DWP.

Mike Hughes
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Elliot Kent - 12 August 2020 11:14 AM

I think this is the same issue as raised here Peter?

https://www.rightsnet.org.uk/forums/viewthread/16361

All very interesting - I wonder if anything came from the GMWRAG meeting…

GMWRAG has some contacts now if that helps at all?

sakhtar
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Hi,

do we have any further information on this?  I came across this happening with some of our tenants in July and our local UC DWP contact had told me what’s been mentioned here, anyone with a work allowance applied we would get 3 payments of rent arrears deductions before they would stop.  I was told we could reapply again but it means having to reapply for the deductions every 3 months.  Also I’ve had a few cases this week where there the claimant doesn’t have a work allowance applied but the same has happened with their deductions so don’t know if its happening with all claimants now? 

Thanks Saima

Timothy Seaside
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sakhtar - 21 August 2020 11:02 AM

Hi,

do we have any further information on this?  I came across this happening with some of our tenants in July and our local UC DWP contact had told me what’s been mentioned here, anyone with a work allowance applied we would get 3 payments of rent arrears deductions before they would stop.  I was told we could reapply again but it means having to reapply for the deductions every 3 months.  Also I’ve had a few cases this week where there the claimant doesn’t have a work allowance applied but the same has happened with their deductions so don’t know if its happening with all claimants now? 

Thanks Saima

The rule is that no third party deduction (“3PD”) for rent arrears should start if the claimant earns at least the work allowance. If there is already a 3PD in place then it should stop if the claimant has earned at least the work allowance for the past three months (see Sch 6 of the Claims and Payments Regs).

It’s never been applied before - seems the DWP hadn’t noticed it, or perhaps just nobody told the system developers? But since June it’s been working more or less as it should.

Your contact centre is correct that you could reapply, but they can’t start making deductions unless the claimant has earned less than the work allowance.

The more interesting question for me is “which work allowance?” For anybody without children or LCW the work allowance is £0, and so if they earn £0 or more then their 3PD should stop, no?

Edit: I should say that Para 1 of Sch 6 does seem to be pretty clear which work allowance we’re talking about - it is the work allowance for the claimant in question, as established by Reg 22 UC Regs.  But I think there’s some room for confusion because this comes from the olden days when UC was meant to encourage work and the intention was that everybody would get a work allowance of some sort.

 

[ Edited: 21 Aug 2020 at 11:53 am by Timothy Seaside ]
Elliot Kent
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Timothy Seaside - 21 August 2020 11:30 AM

The more interesting question for me is “which work allowance?” For anybody without children or LCW the work allowance is £0, and so if they earn £0 or more then their 3PD should stop, no?

That’s my understanding.

I think the point to be made is that DWP have unlawfully been making these deductions and they can’t start doing so again. Some sort of reboot or redesign of the system appears to have triggered this being picked up. If your organisations want DWP to pay APAs in these circumstances going forward, its likely that you will need to lobby for the regulations to be changed.

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Elliot Kent - 21 August 2020 11:50 AM

That’s my understanding.

I think the point to be made is that DWP have unlawfully been making these deductions and they can’t start doing so again. Some sort of reboot or redesign of the system appears to have triggered this being picked up. If your organisations want DWP to pay APAs in these circumstances going forward, its likely that you will need to lobby for the regulations to be changed.

It’s not the APA (MPTL) - it’s just the 3PD.

But I can see that it’s not unreasonable when compared to legacy benefits. We could only ever get deductions from IS, IR-ESA, etc. - which wouldn’t have been in payment if the claimant was earning much.

I think it would be helpful to (and welcomed by many) tenants if they could opt to have the payments deducted (especially if we are right about the £0 work allowance issue for people who aren’t working at all).