DWP confirms the recovery of benefit overpayments has been suspended temporarily

07 April 2020

As previously reported by the CIPP’s News Online, the Department for Work and Pensions (DWP) has now issued a press release confirming that the recovery of benefit overpayments has been paused for a period of three months. This is in response to the coronavirus crisis.

This means that many claimants will see an increase to the amount that they receive in benefits that they are receiving during the outbreak and will also allow the department to shift large numbers of staff to front line roles. This will allow them to focus on ensuring that they can provide money to those who need support as there have been a significant increase in claims over the last two weeks. It has been confirmed that 10,000 current staff will be moved to front line roles and the department has confirmed that it is recruiting more.

Deductions relating to the recovery of Universal Credit, and legacy benefit overpayments, Social Fund loans and Tax Credit debts will temporarily be paused. Most of these deductions will be automatically suspended, but if repayments are made via standing order, bank giro credit or online banking, then the relevant bank should be contacted, and the arrangement cancelled.

The recovery of advances by deduction from Universal Credit payments will continue.

Some other key points include:

  • The recovery of Advances by deduction from Universal Credit payments will continue
  • Local Authorities will suspend referral of Housing Benefit overpayments
  • The transfer of Tax Credit debt from HMRC has already been suspended
  • Debt recovery activity will be stopped as soon as possible. This includes all benefit-related overpayments, Social Fund loans and Tax Credit debts. Many activities will cease immediately but others may take longer to implement
  • For citizens who are not on benefits, private sector debt collection agencies have been directed to stop their activity for Debt Management customers
  • Voluntary debt repayments and recovery by Direct Earnings Attachments are also being suspended

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