EXCL Ministers condemned as housing benefit overpayment bill hits £2bn

Posted On: 
13th September 2017

Ministers have failed to recoup some £2bn in taxpayer cash that was wrongly paid to housing benefit claimants, PoliticsHome can reveal.

In May it emerged some 6.4% housing benefit was overpaid in 2016/17
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The amount of outstanding housing benefit overpayments stood at £2.02bn in January this year, according to figures from the Department for Work and Pensions.

It marks an 8% increase since the same month a year before and is the first time the sum – which has been growing steadily since 2008 – has busted the £2bn mark.

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Shadow Work and Pensions Secretary Debbie Abrahams condemned the “total incompetence” of ministers and blamed cuts to local councils.

“By slashing local authorities' budgets the Tories have left many authorities without the resources to properly manage housing nenefit case-loads,” she told PoliticsHome. 

“This is wasteful and expensive, as overpayments have to be recovered, and can cause considerable anxiety for those who didn’t realise they were being overpaid.”

She added: “With billions of Housing Benefit going to private landlords rather than bricks and mortar, the idea that Tory incompetence could be further lining their pockets with overpayments is astonishing.”

Since 2008 some £680m of overpayments has been completely written off, with £95m written off in the 2016/17 financial year alone.

In May it emerged some 6.4% housing benefit was overpaid in 2016/17 – the highest level since records began in 2005/06 – with fraud identified as the biggest outflow of overpayments.

The rate of fraud stood at 4.6% of all overpayments - again the highest proportion on record - while overpayment due to claimant error reduced to its lowest recorded rate at 1.4%.

The Department for Work and Pensions failed to respond to PoliticsHome by the time of publication.