Housing Benefit Debt Recovery

Transcription

1 Housing Benefit Debt Recovery IRRV Annual Scottish Benefits & Benefits Fraud Conference November 2011 Alan Sullivan, John Giblin, Managing Consultants, Housing Delivery Division, Department for Work and Pensions

2 The current climate Tough time for debt collection agendas: central government v local government claimants with multiple debts formal Debt Management Plans for repayment in place in many cases CAB Debt Management companies those agreements already in place are more likely to break down risk of applying warrant for execution at the Sheriff Court court will take account of other debts priority not given to HB debt end up with uneconomical repayments LAs are recovering more debt over 420 million was recovered by LAs in , compared to 288 million in (a 46 per cent increase) HB overpayments created are also increasing, by 18% to 968m between the last quarter of 2009/10 and 2010/11.

3 Other factors Effect of Local Housing Allowance all payments in Private Rented Sector to claimant limited scope to recover from Landlord (although Registered Social Landlords still receive payment direct) recovery from claimants tends to be by instalments/claw back rather than bulk recovery Impact of ATLAS general positive feedback = less ongoing recovery/debts take longer to get back LAs feel that it has created additional work need for a structured plan Lack of powers when compared to Revenue recovery.

4 Ensure that you are doing all you can Run relevant reports to see if you can maximise debt recovery rates benefit in payment, no current recovery benefit not in payment, no current recovery arrangement all working claimants ensure relevant earnings disregard applied to recovery rate recovery rate below standard instalments and clawback (Fraud and Claimant error/official error) Rent Rebate account carry out regular review against outstanding overpayments to check any credits on these accounts.

5 Are your processes effective? Notification and clawback applying DWP maximums + 50% earnings disregard Notification and invoice Recovery plan Use of reminders Timescales Using full recovery methods at earliest opportunity Court procedures Action post court procedures Write-off.

6 Clawback and Instalments Hardship claims - Income and Expenditure Ensure procedures exist for this process Review the existing form (to make it as simple as possible) Issue the form in all cases where a customer requests less than the standard DWP maximum deductions Recommend that repayments should not be reduced until the form has been retuned and an official decision has been made provide guidance on what to accept as legitimate expenditure if claimants are repaying other debts, ensure you give priority to the HB debt.

7 Methods of recovery DWP debt management Recovery from other LAs Debt collection firms Warrant for execution at the Sheriff Court Subsequent action once warrant granted.

8 Relationship Fraud and Recovery Is there a good relationship between your fraud and recovery team? Need a shared understanding of each other s targets and priorities Fraud need to consider the impact of their work in terms of the amount of overpayment created as a result of their action and always have an eye for how this money will be recovered Recovery team need to understand the nature of the fraud and avail themselves of all the intelligence that the fraud team have on the (potential) fraudster.

9 Relationship Fraud and Recovery Suggested Good Practice in fraud cases where the overpayment is over X (tbc by LA) the fraud and recovery team conduct a case conference to discuss the nature of the fraud and share any intelligence that may be available to improve the likelihood of recovery of the overpayment a member of the overpayments team to attend at the end of all Interviews Under Caution where an overpayment has/will be created to a) stress the importance to keeping to any agreement that has been made or b) seeks an agreement/recovery where a repayment agreement has yet been made c) takes a first/token payment d) deal with administrative penalty issues.

10 Further challenges Civil penalties - 50 penalty on claimant error overpayments revenue retained by LA Single Fraud Investigation Service Universal Credit direct payments Challenge of legacy debt.

11 Points for discussion Does your recovery team have the right level of administrative support? Are your processes for offsetting underlying entitlement against the overpayment effective? Do you act quickly? Do you set realistic debt collection targets (including cash targets)? Do you manage write-offs effectively? Are staff proactive in calling debtors rather than just sending out things by post? Do you have a good relationship with DWP debt management? Are you selective with the debts that you refer to debt collection agencies and do you monitor and analyse the success of this collection method? Do you have strong links with your Fraud section? Do you ask your legal team to do unnecessary clerical work? Do you network with others? Are you being innovative?

12 Questions?