News / General

RECOVERY OF OVERPAYMENT OF SOCIAL SECURITY BENEFIT

By SLAS Spokesperson

Where a person receives an over-payment of a social security benefit, any recovery by the state is likely to be bedevilled by the fact that, almost by definition, the recipient is unlikely have funds available to repay the overpayment. Perhaps that was part of the reason why the right of the state to recover these over-payments as set out in section 71 of the Social Security Administration Act 1992 is restricted to cases only in which the recipient had induced the over-payment by misrepresentation or non-disclosure of a material fact and it was long accepted that, if the payment had arisen by official error in the calculation of the amount to be paid, then no recovery was available simply because there was no statutory provision which allowed this. However, from about 2006, the Department of Works and Pensions (DWP) initiated a policy or seeking recovery of these overpayments under the common law of unjust enrichment. However, a test case was brought in the Child Poverty Action Group v Secretary of State for Work and Pensions [2010] UKSC 54 when the Supreme Court held in December 2010 that section 71 of the 1992 Act was the only root to recovery of overpayments to the exclusion of any common law rights. Presumably, erroneous payments, such as where the wrong sum is credited to the recipients account as opposed to payments arising out of erroneous calculations of benefit entitlement, remain recoverable on the basis of the conditio indebiti.
 

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