(This note is not part of the Regulations)
These Regulations make provision relating to recovery of amounts which are recoverable under social security legislation.
Part 1 makes general commencement and interpretation provision (regulations 1 and 2).
Part 2 makes provision relating to recoverability. Regulation 3(1) prescribes that overpayments of both universal credit, jobseeker's allowance and employment and support allowance under section 71ZB of the Social Security Administration Act 1992 (“the Act”), subject to provision as their calculation, and overpayments of tax credits under the Tax Credits Act 2002 (c.21) are recoverable amounts for the purpose of these Regulations. Civil penalties, administrative penalties, payments on account of benefit and hardship payments are also recoverable amounts under these Regulations. Regulation 4 makes provision as to who certain overpayments are recoverable from where it is necessary to recover from a person instead of, or in addition to, the person to whom it was paid. Regulation 5 makes provision as to when overpayments made under an award will still be recoverable if there has been no revision or supersession of that award.
Part 3 prevents duplication of payment of universal credit where income which would be taken into account in a universal credit claim is paid after the prescribed date for payment of that income.
Part 4 makes provision as to the calculation of the recoverable amount. Regulation 7 makes provision, where an overpayment of universal credit relates to the amount of a person's capital, for the amount of that overpayment to be reduced to take account of diminution in that capital. Regulation 8 allows for the recoverable amount of the benefits to be reduced to take account of any universal credit which should have been paid to the person concerned or their partner. Regulation 9 makes provision relating to calculating the amount of an overpayment of housing costs in universal credit where a claimant changes dwelling.
Part 5 makes provision as to the process of recovery. Regulation 10 allows recovery of recoverable amounts to take place by deduction from certain benefits. Regulation 11 prescribes limitations on such recovery where the benefit to be deducted from is universal credit; regulations 12 to 14 do the same where the benefit to be deducted from is jobseeker's allowance, employment and support allowance and state pension credit respectively. Regulation 15 makes provision confirming when an obligation of a tenant is taken to have been discharged when recovery of an overpayment of housing costs has been obtained by deduction from a landlord's benefit. Regulation 16 allows, where a decision awarding benefit relating to is reversed or varied or revised or superseded, for the offsetting of arrears of entitlement against subsequent payments of universal credit, jobseeker's allowance or employment and support allowance.
Part 6 makes provision for recovery of recoverable amounts by deduction from earnings. Regulation 17 defines certain terms used in that Part. It defines “earnings” for the purpose of the Regulations and the proportion of earnings below which the amount paid to the liable person must not be reduced by virtue of the deduction under regulation 20. That proportion is 60 per cent. of the liable person's net earnings for the relevant period.
Regulation 18 and Schedule 1 provide that Part 6 does not impose any obligation on new businesses and existing micro-businesses. New businesses are those which start business in the period starting on 8th April 2013 and ending on 31st March 2014. An existing micro-business is a business with less than 10 employees on 8th April 2013. Such businesses are exempt from that requirement both for so long as they remain a micro-business and for any grace period (defined in paragraph 4 of Schedule 1) following the date on which they cease to be such a business.
Regulation 19 prescribes what details a notice requiring the employee to make deductions from earnings must contain and when it (and a varied notice) takes effect.
Regulation 20 and Schedule 2 prescribe the amounts to be deducted by the employer from the amount paid to the liable person each pay-day. In addition, paragraph (9) of that regulation allows the employer also to deduct a charge not exceeding £1 in respect of any administrative costs.
Regulation 21 requires the employer to notify the liable person of the amount of the deduction including any deduction in respect of the employer's administrative costs.
Regulation 22 requires the employer to pay the amount of the deduction (excluding any additional deduction for administrative costs) to the appropriate authority which sent the employer the notice by any of the methods set out in paragraph (2) of that regulation. It also requires the employer to keep records of amounts deducted and of persons in respect of whom such deductions have been made.
Regulation 23 requires the liable person to inform the appropriate authority within 7 days if they leave the employment of an employer who has received a notice in respect of them or when they become employed or re-employed.
Regulation 24 requires a person to notify the appropriate authority if a notice is received on the assumption that they are the employer of a liable person but it transpires that they are not or if they think the exemption in regulation 18 applies to them. It also requires the employer to notify the appropriate authority if the liable person ceases to be in their employment.
Regulation 25 allows the appropriate authority to vary notices to decrease or, if agreed, to increase amounts included in them or to substitute a new employer for a previous one and requires the employer to comply with the notice as varied.
Regulation 26 provides for a notice to be discharged in certain circumstances if no further payments are due under it, it is ineffective as a means of recovery or it is defective.
Regulation 27 allows for notices to lapse if the employer no longer has the liable person in their employment.
Regulation 28 makes special provision relating to those in the employment of the Crown.
Regulation 29 makes provision as to priority where employers are obliged to make deductions under more than one notice under these Regulations. In such a case, they are to be dealt with in date order with the earlier order coming first. It also makes provision as to priority where employers are obliged to make deductions under notices issued under these Regulations and other orders requiring deductions to be made from earnings, including diligences against earnings in Scotland. The general rule is that deduction from earnings orders under the Child Support (Collection and Enforcement) Regulations 1992 (S.I.1992/1989) must be dealt with first. Where deductions would otherwise fall to be made under notices issued under these Regulations and either deductions under those other enactments or diligences against earnings, deductions under other orders and diligences are to be made first if in existence on the first pay-day for deductions under the notice. Otherwise, the various notices and orders are to be dealt with in date order.
Regulation 30 makes it a criminal offence to fail to comply with certain provisions of Part 6. These relate primarily to failures to make or pay deductions or to provide information.
Part 7 amends associated legislation. Regulation 31 amends the Social Security (Payments on account, Overpayments and Recovery) Regulations 1988 (S.I.1988/664) to ensure that overpayments of benefits coming within section 71 of the Act can be recovered by deduction from universal credit and personal independence payment and by deduction from earnings in accordance with Part 6 of these Regulations. It also clarifies the rules on what sums are deducted in calculating the amount of a recoverable overpayment under those Regulations. The amendments also ensure that the limitations on deductions from universal credit made under these Regulations apply equally to deductions under those Regulations. Regulation 32 amends the Social Fund (Recovery by Deductions from Benefits) Regulations 1988 (S.I.1988/35) to add universal credit to the list of benefits from which social fund awards may be recovered by deduction.
Part 8 amends housing benefit legislation to ensure both that local authorities can request the Secretary of State to instigate recovery of overpayments of housing benefit by deduction from universal credit and personal independence payment and that they may can recover such overpayments themselves by deduction from earnings in accordance with Part 6 of these Regulations.
An impact assessment has been produced for Part 6 and is available alongside the instrument onwww.legislation.gov.uk
An impact assessment has not been produced for the remainder of this instrument as it has no impact on the private sector or civil society organisations.