The Department for Work and Pensions (DWP) has shed light on its ability to obtain funds from claimants' bank accounts following a letter about overpayments. A family member of a deceased state pension recipient received a letter from the DWP.
It confirmed no arrears on the account but added: "If there has been an overpayment we will try to recover this directly from the deceased's account." The DWP was asked to explain this, especially as legislation is being discussed in Parliament to empower DWP investigators to directly deduct amounts from a person's bank account in cases where a payment has been wrongly received and the individual refuses to repay.
In response, the department explained that if a payment mistakenly goes out after a person's death, they can request the bank or individual to return the amount, under the common law of restitution. A spokesperson said: "It is not our intention to cause distress, however, we have a responsibility to taxpayers to recover overpayments. We acknowledge this is not always possible.
"Whilst there is no legal obligation to repay a debt of this type, we recognise some people will be willing to repay money to which there was no entitlement. We provide full contact details and encourage anyone with concerns to call us."
The DWP said it does not issue further letters demanding repayment if there is no response. Overpayments can occur when the department does not get notification of a person's death in time to stop their payments going out.
These powers differ from legislation currently under review by MPs, which would empower officials to directly withdraw funds from an individual's bank account in instances of fraud or other improper payments. While the DWP can currently recover funds through deductions from a person's benefits or directly from their PAYE earnings, these new powers would enable them to target individuals who are not presently receiving benefits or payments.
In situations where investigators intend to make a deduction, they must request at least three months' worth of bank statements to verify that the individual has sufficient funds to repay. The deduction could be a one-time lump sum or in regular amounts, with the individual given a minimum of 28 days' notice to contest the matter.
The new laws would also permit investigators to verify the eligibility of benefit recipients by asking banks to disclose details of accounts receiving benefits. Initially, these checks will be applied to those on Universal Credit, Employment and Support Allowance and Pension Credit, but they could potentially extend to other benefits.
From April, state pension payments are set to increase by 4.1%, with the full basic state pension rising to £176.45 per week and the full new state pension increasing to £230.25 per week.
English (United States) ·