Just short of 15,000 people claim that they have wrongly been ordered to pay back Universal Credit payments. This comes as the government attempts to retrieve the £500m it handed out in pandemic benefit payouts.
Some of those are being asked to return the money handed out to them because they missed messages or phone calls from the Department of Work and Pensions (DWP), requesting evidence as part of the retrospective checks it carries out, reports The Independent. 125,000 people have been informed by the DWP that they were not eligible for the payments, so they now owe thousands of pounds due to Covid putting a stopper on face-to-face identity checks at the beginning of the pandemic.
In the eyes of the government, if an individual 'does not provide evidence/fully engage in the process', then they could be deemed to be the recipient of an overpayment. Around 14,500 are appealing against the payback orders after some were pursued by debt collectors.
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Jonathan Ashworth, Labour's shadow work and pensions secretary, said: "It's shameful that ministers are pursuing what could be thousands of people for debt they do not owe, in the middle of a cost of living crisis. Instead of parading around supporting their chosen leadership candidates, ministers in the DWP should be focused on their day jobs and solving the pressing problems in their department."
In the first year of the pandemic, the number of people on Universal Credit in the UK doubled, increasing to 6million in January 2021. In May 2022, 5.6million people claimed the benefit.
According to figures from the DWP, Universal Credit fraud overpayment rates are at their highest on record, at 13% (£5.3billion) in 2022, compared with 12.8% (£4.9billion) in 2020, and 6% in 2019. 29-year-old Billy Waterworth started claiming Universal Credit after losing his job as a chef at the beggining of the first lockdown.
Billy found another job within several months, leading to the closure of his account in October 2020. He then received a letter from the DWP six weeks later, which informed him that he owed £3,347.55 in 'outstanding debts', which is the total amount he had received in Universal Credit.
The letter stated that, if Billy, who lives in southeast London, did not start paying this sum of money back within five weeks, the DWP would be contacting his employer to make deductions from his pay, or a debt collection agency would demand the money from him. He told The Independent: "I didn't know what was going on. "I don't earn a whole lot of money. That would be a big chunk of my yearly income."
After contacting the DWP, Billy found out that he had missed a number of calls from the department, and a subsequent message in his Universal Credit journal requesting evidence. Billy immediately tried to dispute the decision with the DWP, and believed that his appeal was progressing.
A month later, Billy received a letter from a debt recovery agency, which demanded he set a payment plan up. After six months of Billy trying to convince the DWP that he did not owe any money, the department reached the conclusion that they had made a mistake, and cleared the debt.
In another case, a 49-year-old man, who did not want to be named, started to claim Universal Credit at the beginning of the pandemic after his business fell on hard times. The DWP called him a year later, asking him to send a photo of himself holding his passport.
The man claims that he was not given a deadline to do this by, and received a letter two weeks later, telling him that he owed more than £13,000 while his Universal Credit, which he was still receiving, was suspended. Later, the London resident's appeal found that the DWP had made a mistake and he had been eligible for benefits, but he did not receive any support during the seven months it took for the process to conclude.
The father-of-two said: "It was a very embarrassing situation to be in. My financial situation hasn’t fully sorted itself out, but I don’t want anything to do with the DWP again."
Claire Hall, a lawyer at the Child Poverty Action Group, which has helped those who have been wrongly asked to pay back Universal Credit, said it was possible that thousands of individuals could be affected, and raised alarm at the delays and complexities inherent in the appeal process. She added: "It’s very unfair on claimants that they’ve been given these debts and told they owe this money with no proper basis. It’s hugely stressful for people, especially with the timing of it all, when people are just recovering from the pandemic and getting back on their feet."
A spokesperson for the DWP told The Independent: "During the pandemic, we rightly prioritised ensuring the welfare safety net reached those suddenly in difficulty. We have been contacting claimants via their preferred contact method to discuss aspects of claims we need to verify, and given them two weeks to respond. If we are belatedly provided evidence proving entitlement, we will reinstate benefit and cancel any debt straight away."
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