Why the government can’t reclaim overpaid benefits

Debtwizard's picture

Earlier this month the Court of Appeal ruled that the secretary of state for work and pensions cannot recover overpayments of social security benefits through the courts in cases where the claimant is not at fault.

The case was brought by the Child Poverty Action Group after the government wrote to over 65,000 claimants telling them it could take them to court at common law if they did not pay back benefit overpayments.

The benefits in question included income support, incapacity benefit, housing benefit, pension credit and the state pension – benefits that cost the taxpayer the most.

However, The Court of Appeal’s ruling means the government cannot write these letters to claimants in future.

This ruling is good news for some of the poorest people in our society as they are unlikely to have the means to repay the sums back.

Had the Department for Work and Pensions won the case, then the government would have stopped benefit payments to all the individuals who had been overpaid until it had recovered the amounts - this would have caused considerable hardship and misery.

But it also means that taxpayers will pick up the bill for the incompetence of the bureaucrats at the Department of Work and Pensions. And it’s likely to be a hefty bill at that - auditors claim £900 million was overpaid last year alone.

Another important point to note is that the ruling does not affect overpayments of tax credits. However, the Child Poverty Action Group has a separate campaign on this issue, which you can find out more about on its website.

Your Comments

i have started work and was informed by the job centre i was able to claim H.B i filled in my housing benefit form and sent in my information tax credit bank statement ect i have since received a letter stating that i own 1200 pounds in overpayment i cant understand as i have took in all my wage slips every week so this did not happen.

i have been in today and the mistake is they have my son as still living with me but he is not its just my daughter.

i informed them of this in my new claim form at the start of my claim i have also given them my tax credit information which states i am claiming for one child and my bank statments which also has my child benifits as claiming for one child can someone please help me as i feel it there mistake and i should not have to pay this money back to them

I am at my wits end with the department of work and pensions. I have had a letter claiming I owe 614 pounds for benefit I was paid when I was out of work and claiming benefit. They have told me that because my circumstances changed and they were not informed I am now liable for the money. The funny thing is I did everything to the book and informed them straight away when I got a job. I was unemployed and they were paying me benefit so how can they think that they did this wrongly.

It just goes to show being honest still gets you nowhere!

I have received a letter from the dept of work and pensions informing me that I owe a sum of £1407 from an over-payment made between 1995 to 1996. At the time, I was a single parent at university. I was told that I should not have claimed income support because I had received a student grant, which I should have informed them about.
Am I eligible to pay this back, since this was 15 years ago?