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The Latest Information on Debt Recovery

On 13 May the Minister for Communities announced a temporary suspension of the recovery of some benefit debts. Below is a short summary of implementation information for advisers to be aware of in supporting their clients:

Universal credit:

• Recovery of benefit debt from universal credit has been suspended for three months since 10 April 2020. The period of suspension is subject to review.
• Third party and child maintenance deduction was suspended for one month from 10 April 2020.
• Advance payment recovery has not ceased.

 Legacy benefits:

• There have been no new overpayment recoveries since the start of April.
• There have been operational challenges in stopping the recovery of existing debts but these suspensions are being introduced on a phased basis.
• Attendance allowance, disability living allowance, personal independence payment, industrial industries disablement benefit and widow’s benefits have already had recovery from these benefits suspended.
• Income support and pension credit suspensions are being implemented.
• State pensions will be next, then jobseekers allowance and employment support allowance, then carer’s allowance (with an aim to complete all by end of June).

 Discretionary support and social fund:

• Work is ongoing to suspend recovery of social fund and discretionary support loans and again the intention is to complete suspensions by the end of June.

People who are no longer in receipt of benefits:

• New debt recoveries suspended.
• Benefit recoveries from employers suspended.

Notification letters:

• For claimants with deductions coming from income support, pension credit, state pension, jobseekers allowance, carer’s allowance or employment support allowance, the suspension of recovery results in the issue of a letter to the claimant advising that they will now have to make their own arrangements to repay any money. This is an automatic system generated letter and cannot be stopped.
• As a result, the Department for Communities (DfC) will issue a letter separately, including the following information:

“You may have already had a letter, or you may get a letter in the next few days that tells you to carry on with your re-payments, to arrange to pay the money back yourself or to contact us. Please ignore that letter which has been sent to you in error.”

• This may cause some confusion so advisers should be aware of this issue and prepared to explain.
• Contact number and email will be provided on the notification letter.

Additional Information of Note: 

• Suspension will be for at least three months. This is subject to review and the time needed to implement recovery.
• In the event that a person is repaying an overpayment, a social fund loan and a Discretionary Support loan, they will receive six letters. Three, telling them to arrange alternative repayment and three, telling them to ignore these letters. If they are paying two of these three from the benefits listed above, they will get four letters.

Suspension on recovery of discretionary support / social fund could result in difficulty borrowing in the future. Individuals will be notified of potential implications of suspension and given opportunity to continue repayments. Some have already requested to continue repayment. Tel: 0800 587 2981 | Email: DS.RECOVERY@DFCNI.GOV.UK

PIP Independent Review Deadline Extended

The deadline for submitting evidence to the second independent review of the PIP assessment process in Northern Ireland has been extended until 16 October.

NRPF Court Ruling Welcome but Questions Remain

On 7 May the high court of England and Wales ruled that the Home Office policy on ‘no recourse to public funds,’ which precludes some people from certain benefits, breaches Article 3 of the European convention on human rights.

Law Centre NI immigration solicitor, Ashleigh Garcia, said: “This is a welcome and well overdue decision. It remains to be seen, however, how the Home Office policy will have to be amended and how far the changes will go in assisting people at risk of destitution.”

For free legal advice on this issue, contact us at (028) 90 244401.

Court of Appeal in England & Wales Finds UC Transitional Provisions to be Unlawful

In a case brought by Child Poverty Action Group in GB, the Department for Work and Pensions has been found to have breached the human rights of two disabled households who were worse off as a result of claiming universal credit.

The Law Centre social security team currently have a similar case listed for hearing at the high court in Northern Ireland, although with some key differences.  If you, or one of your clients, moved from a legacy benefit to universal credit and became worse off as a result, contact us for free legal advice on (028) 9024 4401.

Advisers - Help Challenge the UC ‘Lobster Pot’

We are aware of some people who may have lost out when they claimed universal credit and have now lost entitlement to tax credits because of the so-called ‘lobster pot’ principle.  We’re keen to hear from advisers who come across a client who was in receipt of the disabled child element of tax credits, then subsequently made a claim for universal credit and is now worse off. Likewise, we are aware that some disabled workers who were in receipt of tax credits may have claimed Universal Credit and are now worse off because of it. Please contact us as we may be able to challenge this on your client’s behalf: (028) 9024 4401.