DHP Overpayment

Hello

Can anyone advise about a case where DHP was awarded to cover a shortfall.  It was later discovered that the claimant had a non-dependent incorrectly applied to the claim (so there should never have been a shortfall).  Once this non-dep was removed there was no shortfall.  An invoice has now been issued for the DHP that was paid as there was no DHP entitlement.

Obviously, an underpayment of HB has also been paid which one might say balances things out.  However, given that the non-dep deduction was clearly as a result of official error and also resulted in rent arrears and great financial hardship for the tenant until DHP was eventually paid, should this DHP be recovered from the client? There was no misrepresentation or failure to disclose on the part of the claimant. Any ideas would be really helpful.  Is the recovery of a DHP overpayment an appealable decision?

Thanks very much

Martin

Martin- have a look at the April 2013 “DHP guidance manual” at item 5.10 (overpayment of DHP’s)

Surely until the HB award has actually been revised, there is no overpayment of the DHP? Then once it has been revised, arrears will be due which would offset the overpayment. Or is that too easy?

Thanks - the award has been revised and an underpayment has been paid to the rent account - offsetting cannot take place for DHP, as far as I can tell.  Which is why an underpayment has been credited to the rent account and an invoice issued for the overpayment of DHP.  In a sense offsetting has taken place, so all is fair and square (the invoice offsets the underpayment).  BUT, is it fair that she has to repay the DHP given that the overpayment was caused by official error, and does anyone have any experience of a similar case?

The guidnace manual says:
You can recover DHPs if you decide that payment has been made as a
result of misrepresentation or failure to disclose a material fact, either
fraudulently or otherwise. You may also recover DHPs if you decide they
have been paid as a result of an error made when the claim was
determined.

I don’t know if it is “fair” but the Council can legally seek recovery as a mistake was made when the DHP was decided, and the DFA regulations don’t impose the same limitations on when overpayments can be recovered that the HB regs do. Recovery can only really be sought through the courts and the simplified proceedure that applies to HB overpayments does not apply to DHPs so yuour client will be able to attend court and defend their position.

The best route to take would probably be that of a complaint to the Ombudsman (after a complaint to the Council) but even there it does not look as though your client lost out financially so not certain how the Ombudsman would view the position.

Thanks very much for this

In terms of ‘fairness’ then if I’ve understood things properly, then the following could occur if there were no recovery;

- the NDD results in a rent shortfall

- DHP is paid to cover that shortfall

- the NDD was as a result of official error, so HB decision is revised, resulting in arrears of HB being awarded and credited to claimant’s rent account (or paid to landlord).

- together with the DHP that was paid, these arrears of HB then result in claimant’s rent account being in credit, possibly to the tune of several hundred pounds.

- claimant requests and receives reimbursement of this credit from landlord. They’ve actually made money out of the situation. Or they leave the credit sitting on rent account to be used up in paying service charges not covered by HB (and which they’d otherwise have to pay themselves). Again making money.

Fairness?