Dept. Work & Pensions debt

Nomissbocaj · 9 July 2018 at 8:27AM

Hello there,
I am speaking on behalf of my partner. A number of years ago she suffered an illness for a few years and was supported by benefits. She also suffers from high mental health issues. Thankfully she progressed and was able to return to work eventually. However she was more focussed on surviving and continuing to do so, subsequently the benefits still came in during her employment.
She understood the benefits to be something paid to her until she was 100% recovered, and wasn't in a right mental state to fully understand the situation.Dwp now say due to her not informing them of her employment she is now required to pay £15000 back and will only accept a minimum of £250 monthly repayments, which is almost a third of her monthly wage. Thus now potentially causing her further debt, stress and recurrence of illness.
My post is to understand whether anyone knows where she stands. I am surprised they have been so forceful knowing her history and not delving into her current finances before demanding such a high repayment fee. Leaving her without money for general expenses and food, of which I now have to support her with.
Hope someone can help.. Thank you.

midnight_express · 9 July 2018 at 9:19AM

Given the level of the overpayment and that the fraud was over a long period of time they have been lenient. Cases such as this often result in a prosecution for fraud and sometimes a prison sentence.

National_Debtline · 9 July 2018 at 10:27AM

Hi Nomissbocaj

Please bear in mind that DWP may have simply defaulted to this rate they have demanded as it is a round figure - they won't know all of your household's precise ins and outs, so the onus is on your partner to make them aware of her current financial position in greater detail and attempt to negotiate more manageable payments on that basis. Putting together a budget or Statement of Affairs (SOA) - see link below - is essential:

http://www.stoozing.com/calculator/soa.php

On the flip side, it is worth pointing out that DWP can potentially seek to dock payments from her wages through a Direct Earnings Attachment if negotiations lead nowhere:

https://www.gov.uk/make-benefit-debt-deductions

Dennis
@natdebtline

iolanthe07 · 9 July 2018 at 10:30AM

So it will take five years to repay the £15,000 without interest. I don't think the DWP could extend it much beyond that, tbh.

JonVarnas · 9 July 2018 at 10:00PM

National_Debtline wrote: »

On the flip side, it is worth pointing out that DWP can potentially seek to dock payments from her wages through a Direct Earnings Attachment if negotiations lead nowhere:

Judging by that link the DWP would only take up to 10% of £750 earnings so there must be some wriggle room.

fatbelly · 10 July 2018 at 5:37AM

That is the higher rate, which I believe is for cases shown to be fraud. The standard rate is

Employee monthly pay Deductions from earnings

£100 or less £430 or less Nothing to deduct
£430.01 to £690 3%
£690.01 to £950 5%
£950.01 to £1,160 7%
£1,160.01 to £1,615 11%
£1,615.01 to £2,240 15%
More than £2,240 20%

zippygeorgeandben · 10 July 2018 at 7:37PM

It sounds like an interest free loan to me. Borrow £15,000 and pay it back over a length of time at 0%. Or are there penalties on top?

Nomissbocaj · 19 July 2018 at 7:42PM

Thanks all for your replies. She never intentionally committed fraud. However this is something I am personally campaigning against now as mental health issues are serious, the dwp didn't care and the risks of pushing someone into great financially difficulty could have severe repercussions. Yes the repayment is greater than any form of prison sentence, but to not even discuss with her about her income and whether the repayments were affordable surprised me. I shall put everyone's comments and suggestions to her and see if there is any negotiating with the dwp to be done. Thanks again.

fatbelly · 19 July 2018 at 8:08PM

There are 3 definitions of fraud in benefit overpayments:

being found guilty at court
admitting fraud at an interview under caution
accepting an administrative penalty

Many people are pushed into (2) or (3) without realising the consequences when the dwp or local council would have a hard job getting (1).

sourcrates · 19 July 2018 at 8:37PM

midnight_express wrote: »

Given the level of the overpayment and that the fraud was over a long period of time they have been lenient. Cases such as this often result in a prosecution for fraud and sometimes a prison sentence.

Fraud ?

Where mental health issues are concerned I doubt that would hold water.

fatbelly · 19 July 2018 at 9:39PM

sourcrates wrote: »

Fraud ?

Where mental health issues are concerned I doubt that would hold water.

In court, with proper support that may be true.

And that's one reason why the benefit agencies prefer to go for (2) or (3) from my list. They can then deduct from existing benefits at a higher rate and protect their debt from insolvency.

My council went through a phase of doing this with housing benefit overpayments in DROs, even many years after the incident
was discovered. They do seem to have backed off once we flagged it up as an unfair practice though.

Little known fact worth throwing in here - If you sign the agreement to an administrative penalty you have 28 days to change your mind - at which point any recoveries of the administrative penalty will be refunded to you.

Dept. Work & Pensions debt

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