MPs reply to Hardship cases

oweny

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</TD><TD class=alt1 id=td_post_6635518><!-- icon and title -->David Mundell MP from James Plaskitt under secretary of state
<HR style="COLOR: #660000" SIZE=1><!-- / icon and title --><!-- message -->Section 187 of the Social Security Administration Act prevents vilnerable social security claimants from giving up or putting their benefit money at risk by assigning it over to a third party in settlement of a debt. It also ensures that benefit does not automatically pass to a debtor,for example,to a trustee in cases of bankruptcy, by making it clear beyond doubt that the Secratery of State's obligation to make payment of benefit is only towards the beneficiary and thar a trustee could have no interest in any entitlement of a debtor to receive social security benefits.

However, the Social Security Administration Act is not intended to prohibit the application of bank charges. Once a benefit payment is credited to a customer's account it merges with the existing account balance,whether this is overdrawn or in credit. If the account is overdrawn, the banks are fully within their rights to offset the benefit payment against the overdraft.
Under the terms set out in the Banking Code,banks are obliged to deal with all cases of financial difficulty sympathetically and positively. Customers who find themselves in difficulty should speak to their account provider about their needs on order to come to an arrangement to deal with their debt and safeguard their benefit payments.
Yours sincerely
JAMES PLASKITT MP
PARLIAMENTARY UNDER SECRETARY OF STATE

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Milarky

I suppose if you are dissatisfied with that reply you could ask "where" the Social Security Administration Act states that is not intended to prohibit the application of bank charges? They have made a claim/interpretation and they have not referred to another Section to establish this. But I would not hold your breath. I would say that where the law has nothing to say about something then it cannot be interpreted 'positively' as it appears from the reply your were hoping that it might?

187 Certain benefit to be inalienable

(1) Subject to the provisions of this Act, every assignment of or charge on—
(a) benefit as defined in section 122 of the Contributions and Benefits Act;
(b) any income-related benefit; or
(c) child benefit,
and every agreement to assign or charge such benefit shall be void; and, on the bankruptcy of a beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of his creditors.
(2) In the application of subsection (1) above to Scotland—
(a) the reference to assignment of benefit shall be read as a reference to assignation, “assign” being construed accordingly;
(b) the reference to a beneficiary’s bankruptcy shall be read as a reference to the sequestration of his estate or the appointment on his estate of a judicial factor under section 41 of the [1980 c. 46.] Solicitors (Scotland) Act 1980.
(3) In calculating for the purposes of section 5 of the [1869 c. 62.] Debtors Act 1869 or section 4 of the [1882 c. 42.] Civil Imprisonment (Scotland) Act 1882 the means of any beneficiary, no account shall be taken of any increase of disablement benefit in respect of a child or of industrial death benefit.

deary65

The simple answer to this is apply to have your benefit payed direct to you by giro.

novelli

are u allowed to have benefits paid direct by giro tho!! I thought u had to have it paid into an account. Especially if the DWP know that u have a bank account, will they then agree to pay by giro?? I would much rather have it that way.

oweny

Open one of these accounts for benefits to be paid in to

MonkeyMad

MPs reply is exactly what I would have thought it would have been. In Statute Law a 'charge' does not mean taking a fee as in bank charges, it means 'to register a interest in' as in a morgage company having a charge against a property.

If you look at the data of the Act (1992) this would have been well before it was common to have benefits paid directly into and so if a Giro was cashed at the Post Office and then paid into a bank it would be used to offset any charges. This is exactly as it should be, since the bank had no idea where the money comes from. Direct payment does not change the principle

krisskross

Lots of posters on MSE have been assuring people that the banks are not allowed to take charges from benefit payments. I am glad this is now clarified that benefit payments are no different to any other money going into an account.

jfmfit

I am new to these Forums so please forgive me if I am writing to the wrong area.
I have applied to get a friend's bank charges refunded on her behalf using the reason for refund is that of 'Illegal Charges'.
After reading stuff on this site I now know I can use other reasons like, as in my friend, she was getting income support and was under other pressures like the loss of her marraige and the loss of her home.

Can anyone tell me if I can send a letter to the bank giving these alternative reasons instead of the original reason of Illegallity. I also want to add Interest on my new reasoned claim as I did not do this on the original claim. CAN I DO THIS?

Twinkly

krisskross wrote: »

Lots of posters on MSE have been assuring people that the banks are not allowed to take charges from benefit payments. I am glad this is now clarified that benefit payments are no different to any other money going into an account.

I was one such poster not so long ago. I am disgusted that the matter has not borne further investigation.

MonkeyMad wrote: »

Direct payment does not change the principle

Then there is valid arguement as to why it should and mandatory payment of benefits into a bank account is the biggie. It is nothing short of legalised extortion. Given that it is mandatory (or so the DSS told me, way back when) to have benefits paid into a bank account it will now prove impossible to protect what little income the government has decided you 'need' to live on.

Personally I prefer to use the money that the government allows me to live on to do precisely that. Live on.

I dont particularly want to pay an inflated charge because some snotty nosed kid with 2 weeks training in customer service cannot operate a direct debit instruction without completely f****** it up and then denying responsibility. I certainly do not want to have to pay it automatically.

A bank charge (reasonable or not) should be on a level with any other debt. It should be prioritised and paid from any excess income after essential living expenses are accounted for.

Perhaps a benefit recipient revolution is now called for and ALL claimants should demand a return to direct receipt of benefits.

krisskross

Twinkly wrote: »

I was one such poster not so long ago. I am disgusted that the matter has not borne further investigation.




Then there is valid arguement as to why it should and mandatory payment of benefits into a bank account is the biggie. It is nothing short of legalised extortion. Given that it is mandatory (or so the DSS told me, way back when) to have benefits paid into a bank account it will now prove impossible to protect what little income the government has decided you 'need' to live on.

Personally I prefer to use the money that the government allows me to live on to do precisely that. Live on.

I dont particularly want to pay an inflated charge because some snotty nosed kid with 2 weeks training in customer service cannot operate a direct debit instruction without completely f****** it up and then denying responsibility. I certainly do not want to have to pay it automatically.

A bank charge (reasonable or not) should be on a level with any other debt. It should be prioritised and paid from any excess income after essential living expenses are accounted for.

Perhaps a benefit recipient revolution is now called for and ALL claimants should demand a return to direct receipt of benefits.

You do not need a bank current account to have benefits paid into. You can have a savings account. You then draw out your cash and use it to pay your living expenses. No DDs, no overdraft. It is almost the same as getting a giro, just safer and less open to fraud. Certainly you won't be getting any bank charges.

gbhxu

jfmfit wrote: »

I am new to these Forums so please forgive me if I am writing to the wrong area.
I have applied to get a friend's bank charges refunded on her behalf using the reason for refund is that of 'Illegal Charges'.
After reading stuff on this site I now know I can use other reasons like, as in my friend, she was getting income support and was under other pressures like the loss of her marraige and the loss of her home.

Can anyone tell me if I can send a letter to the bank giving these alternative reasons instead of the original reason of Illegallity. I also want to add Interest on my new reasoned claim as I did not do this on the original claim. CAN I DO THIS?

Yes you can claim interest on payments taken. It's 8%. Use this calculator

http://www.moneysavingexpert.com/reclaim/bank-charges#interest

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