CPAG wins appeal on overpayment recovery

14.10.09

In a case brought by CPAG the Court of Appeal has ruled today that the Secretary of State for Work and Pensions cannot recover overpayments of social security benefits through the courts where the claimant is not at fault.

Between March 2006 and February 2007 the government wrote to over 65,000 claimants telling them it could take them to court at common law if they did not pay back overpayments. The letter acknowledges the money was paid due to DWP error and was not recoverable under social security law. Benefits affected include those paid to families and those with disabilities as well as to those over 60.

Today’s ruling recognises that “the impact…can be devastating to a person already living in or close to penury.”

The court’s decision means the government cannot write these letters to claimants in future. CPAG is considering the implications for whether claimants can recover money they have already repaid.

Commenting on today’s ruling, Child Poverty Action Group’s solicitor, Sarah Clarke, said:

“We brought this case because we know that letters sent to vulnerable claimants threatening court action if they do not repay have caused considerable distress. We are delighted with the ruling that the DWP cannot recover these overpayments through the courts.”

• Read the BBC report Victory in Overpaid Benefits Case

Notes for editors

• Overpayment recovery test case – summary and guidance for advisers
• See the final judgment on the BAILII website. www.bailii.org/ew/cases/EWCA/Civ/2009/1058.rtf
• For more information on CPAG test cases, visit: www.cpag.org.uk/cro/test.htm
• This case is about recovery of benefits administered by the Department for Work and Pensions and child benefit and guardian’s allowance.
• For up-to-date background facts and stats on UK poverty, visit: www.cpag.org.uk/povertyfacts/
• CPAG is the leading charity campaigning for the abolition of child poverty in the UK and for a better deal for low-income families and children.
• CPAG is one of over 150 member organisations of the Campaign to End Child Poverty, campaigning for public and political commitment to ensure the goals of halving child poverty by 2010 and ending child poverty by 2020 are met.