Recovery of Overpayments - SWLO Procedures


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CONTENTS

SECTION 1 INTRODUCTION
SECTION 2 DEBT RECOVERY FUNCTION
SECTION 3 SETTING UP OVERPAYMENTS
SECTION 4 PROCEDURES - RECOVERY BY DEDUCTION
- Withholding Arrears
- Reducing payments
- Monitoring recovery
- Pursuing debtor
- Closed claims
SECTION 5 PROCEDURES - RECOVERY BY CASH
- Lump Sum
- Instalments
- Bank Account
SECTION 6 PROCEDURES - ENFORCEMENT
- Non respondents
- Defaulters


SECTION 1 - INTRODUCTION

1.1 The aim of the Department's control policy is to prevent fraud and abuse. A key aspect of control policy is deterrence; effective debt management is seen as an integral part of the deterrent approach. Effective debt recovery creates a climate where people who have been overpaid know that they will be pursued until they have repaid their debt to the Department.

1.2 While every effort must be made to reduce the number of overpayments, we must, when they occur, endeavour to recover amounts overpaid through all the means at our disposal.

1.3The recovery of overpayments is now governed by the Department's Code of Practice which came into effect on 16/7/96. The code which standardises the procedures for recovery of overpayments, specifies the circumstances in which the Department may or may not pursue repayment of monies by a claimant who was overpaid benefit, allowance, pension or assistance. Under the provisions of the Code, the Department can defer, suspend, reduce or cancel an overpayment.

1.4 Each scheme area and Local Office has overall responsibility for their own overpayments and to ensure that recovery is made.

SECTION 2 - DEBT RECOVERY PROCEDURES

2.1 Debt Recovery should include the following procedures some of which are already being carried out at Local Offices:

  • record overpayment details;
  • notify claimant of amount of overpayment;
  • arrange suitable recovery arrangements by either -
    - deduction from current social welfare payment;
    - withholding arrears;
    - repayment by lump sum;
    - repayment by downpayment/instalments;
    - repayment by instalments;
  • monitor repayment arrangements;
  • identify/pursue defaulters;
  • initiate civil legal proceedings where necessary;
  • identify closed claims where there is still an outstanding overpayment;
  • make arrangements to ensure that the debt, in these cases, continues to be recovered;
  • analyse overpayments with a view to identifying the causes;
  • make the necessary notifications to Accounts Branch and CRS;
  • compile and issue statistics and returns.

SECTION 3 - SETTING UP OVERPAYMENT

3.1 All overpayments are now subject to the Code of Practice. The following procedures apply where an overpayment has been assessed:

3.2 Overpayment as a result of a revised decision:
The Authorised Officer (usually the Deciding Officer) must issue a Form OR1 to the person, together with the revised decision and Information Leaflet ( SW2) which describes the Code of Practice.

3.3 Overpayment where there is no revised decision:
This arises, for example, where a claim is paid at an incorrect rate due to a clerical error. In such cases the Authorised Officer should issue a Form OR2 and the information leaflet. ( SW2)

3.4 Forms OR1 and OR2 inform the person of the amount of the overpayment and the Department's intended method of recovery, and invite the person to comment on same.

3.5 Where the person argues that s/he should not have to repay (e.g. because the overpayment was caused by failure or error by the Department) these arguments should be considered fully.

3.6 Claimants can be invited to the LO, as at present, to discuss details of the overpayment and the recovery method as proposed by the Authorised Officer. The Authorised Officer should ensure that details of the overpayment and the recovery method, as determined, are recorded on Form OR3.

3.7 It is the responsibility of each Local Office to make every effort to recover all overpayments in full having regard to the provisions of the Code of Practice. The following sections, 4 and 5, outline the procedures to be followed in recovering the overpayment by

  • deduction from debtor's current social welfare payment;
  • cash recovery from debtors who are no longer in receipt of social welfare payments.

SECTION 4 - PROCEDURES - RECOVERY BY DEDUCTION

4.1 Recovery by deduction may be achieved by

  • withholding any arrears of social welfare payments due;
  • reducing a current social welfare payment.
Withholding Arrears

4.2 Any arrears due to the claimant must be withheld to offset the overpayment. The claimant must of course be informed of this when arrangements are being made for repayment of the amount due.

Reducing social welfare payments

4.3 When deciding what amount to reduce a person's social welfare payment by, regard should be had to the person's basic needs and the size of the overpayment. The rate of recovery should not result in the person claiming Supplementary Welfare Allowance (SWA).

4.4 Having considered any factors brought to notice by the claimant, arrangements must be implemented immediately to commence payment at the reduced rate decided.

Monitoring Recovery

4.5 All overpayments must be monitored to ensure the person is still in receipt of a social welfare payment and that deductions are being made.

4.6 Monitoring is also necessary to keep proper track of overpayments for statistical purposes and also to cease deductions once the overpayment is recovered in full.

Action on transfer of claim

4.7 If the claimant moves from one Local Office to another, or to a different scheme area, arrangements must be made by the Local Office where recovery of an overpayment by deduction is being pursued to ensure that the agreed recovery arrangements continue to be implemented in the 'new' LO/scheme area.

4.8 The new LO/scheme owner must therefore be notified of the overpayment and arrangements must be made to have the deductions made.

4.9 The onus to monitor the recovery of the overpayment transfers to the new LO/scheme area who must pursue the recovery as if it had been set up in their own LO/scheme area.

Closed Claims

4.10 Closed UA/UB claims with outstanding overpayments can be broken into the following categories -

  • Moved to another scheme;
  • Gone back to work;
  • In prison/emigrated;
  • Deceased;
  • Status not known.

4.11 Moved to another scheme - when the claimant moves to another scheme e.g. DB, FIS, OPFP etc. it is necessary to arrange with that particular scheme owner, (as stated above) to have relevant/adequate deductions put in place and to monitor recovery. A copy of the forms OP1/OP2 and the relevant OR forms should be forwarded along with this request.

4.12 Gone back to work - when the person goes back to work (whether under contract of service or self-employed) s/he is usually in a much better position to repay and therefore must be pursued and reminded of the amount still outstanding. Such persons should be issued with a form OR 10 seeking a new agreement to repay any overpayment still outstanding. Non respondents should be pursued as per procedures set out in Section 6.

4.13 In prison/emigrated: Where it has been discovered that the person has left the country or is in prison, the UA/UB claim papers should be noted and debt reactivated/pursued when next claim is made.

4.14 Deceased debtors: Efforts should be made to discover if a will was made and, if appropriate, recovery action against the estate of the deceased debtor should be taken.

Such cases should be referred to an Inspector for any action considered necessary. Local Offices should note the claim papers for review every 6 months.

4.15 Status not known: Every effort should be made to discover the reason the person signed-off or left the system e.g. check Infosys, their present status, etc. Depending on the resultant circumstances necessary action should be taken to recover the debt due as outlined in the foregoing paragraphs.

SECTION 5 - PROCEDURES - RECOVERY BY CASH

5.1 In cases where a debtor is not in receipt of a social welfare payment Local Offices must still endeavour to recover the overpayment by seeking refund from the person concerned. When determining recovery procedures by cash the relevant Local Office will take into account the person's circumstances and ability to pay. Where instalments or standing order arrangements are made it will be necessary to monitor the recovery position.

5.2 Refunds can be made by -

  • lump sum;
  • instalments;
  • combination lump sum/instalments.
Lump sum

5.3 The person may be required or may decide to clear the debt by a single lump sum payment.

Instalments

5.4 An instalment arrangement can be made whereby payments of weekly/monthly/quarterly amounts are agreed to be repaid.

5.5 It is vitally important to monitor instalment repayments to ensure that payments continue. If payment ceases necessary steps should be taken immediately to reactivate instalment agreement. Lapsed claim cases with an Overpayment should be held out separately.

5.6 In cases where instalment arrangements are sought the debtor should be asked to acknowledge the debt in writing and apply for instalment facilities to pay off the amount due, specifying the amount to be repaid in each instalment. An application/acknowledgement form for this purpose, OR 11, should issue.

5.7 Where an instalment arrangement has been agreed, the debtor should be requested to set up a Standing Order arrangement or arrange to have the agreed instalment paid by Direct Debit from his wage/salary.

5.8 Bank Account

A bank account, titled "Department of Social, Community and Family Affairs Public Bank Account - Control Remittance Account", is to be used for accepting remittances from debtors who wish to refund overpayments. The details of this account are as follows:

Bank of Ireland
2 College Green
Sort Code 90 00 17
A/c Number 24724660

5.9 In asking debtors to send remittances to this account it is vital that they be instructed to quote their Personal Public Service Number on all lodgements being made.

SECTION 6 - PROCEDURES - ENFORCEMENT

6.1 Persons against whom enforcement procedures are necessary, will generally fall into two categories viz. -

  • non-respondents;
  • defaulters
    - no refund made;
    - repayments stopped.
Non-respondents

6.2 In any case where a debtor fails to respond to a communication regarding his/her repayment proposals, the following procedures should be followed to secure recovery of the debt.

6.3 A period of 21 days should be given for response to original request, form OR 10. If such a response is not received within this time a reminder, form OR 12, should issue giving a further 7 days to respond.

6.4 If there is no response to OR 12, a formal demand, form OR 13, should be issued to the person for the recovery of the overpayment and s/he should be advised that failure to respond within 21 days will result in the case being considered for civil proceedings.

6.5 If there is no response to the formal demand the case should be forwarded to Central Prosecutions Service for consideration of Civil proceedings. Such cases should be accompanied by the revised decision which gave rise to the overpayment, a schedule showing the amount recovered and the amount still outstanding, a report on the present financial and domestic circumstances of the debtor and an assessment as to his/her wherewithal to meet the debt due.

Defaulters - no refund made

6.6 These are persons who enter into an agreement to refund the overpayment either by lump sum, instalments or deduction, and then default on the arrangements. A formal demand, form OR 14, for full amount due should be made and proceed as per 6.5 above if no response made.

Defaulters - repayments stopped

6.7 These are persons who make the agreed repayments for a given time and then stop.

6.8 Immediately the cessation of payment becomes apparent, the person should be issued with a form OR 15 pointing out that repayments being made have ceased and the debtor is, therefore, in breach of the agreement. S/he should be warned that unless s/he commences the repayment immediately and pays whatever arrears have occurred as a result of the default that legal proceedings will be considered to recover the total amount of the outstanding overpayment. If a satisfactory response to this is not received proceed as per 6.5 above.


Last modified:01/07/2010
 

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