Duncan Smith loses court battle to claw back benefit payments

By staff writers
December 8, 2010

Anti-poverty campaigners have welcomed a decision by the Supreme Court, which has today (8 December) dismissed an appeal by the Department for Work and Pensions (DWP), who are attempting to claim back benefits that they accidentally overpaid.

The court ruled that the Secretary of State for Work and Pensions, Iain Duncan Smith, cannot recover overpayments of social security benefits through the courts when the claimant is not at fault.

Between March 2006 and February 2007 the Government wrote to over 65,000 claimants telling them it could sue them in the County Court if they did not pay back overpayments which were caused by the DWP’s own mistakes.

“This is an important decision that will protect many vulnerable people from debts created by the government’s own errors,” said Alison Garnham, Chief Executive of the Child Poverty Action Group (CPAG).

She added, “Even though the letters claimants were sent acknowledged it was the government’s own errors and the debt was unrecoverable under its own social security law, explicit threats of court action were still made”.

Garnham urged the DWP to improve its administration. She said that the people who had been overpaid “were not fraudulent claimants trying to get extra money. Rather, they were the innocent victims of DWP error and the complexity of the benefit system.”

CPAG and other anti-poverty campaigners cited a string of cases of vulnerable people becoming extremely distressed when threatened with court action over money they could not pay.

The cases include a 75-year-old man with Parkinson’s Disease and dementia who was overpaid Attendance Allowance of £186.75 when he moved into a care home. An overpayment recovery letter was received by his 82-year-old wife who was very upset and had no money to repay.

Other cases include a 52-year-old woman who was told she owed hundreds of pounds. In fact, the letter itself was an error – there had been no overpayment in her case. CPAG pointed out that the Citizen’s Advice Bureau (CAB) adviser who helped her sort the issue out has since been made redundant due to government cuts to CAB welfare advice services.

The DWP demanded £10,000 from one pensioner, who had been accidentally overpaid a small amount each week over years.

He said, “When I got the letter I was very worried. I am not saying I was suicidal but I nearly felt like that. I couldn’t have afforded to pay back £10,000. I would have had to take out a mortgage on my house to pay back that amount.”

While welcoming the Supreme Court’s judgment, Garnham added, “It is a very great concern that if the government’s plans to end legal aid for welfare benefits proceed, claimants will not be able to get advice on these complex issues in future and may face injustices as a consequence.”


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