Housing handouts overpayment gives landlords £7.5m

Council manages to recover just a fraction of sum

Landlords pocketed almost £7.5million in overpaid housing handouts last year.

Benefits bosses forked out the bumper sum – but clawed back just a fraction of taxpayers’ cash.

Payments are made to claimants struggling to afford to put a roof over their heads.

Renfrewshire Council insists measures are in place to detect mistakes.

A spokesman said: “The council has voluntarily opted to use realtime Information provided by HMRC proactively to facilitate early identification of potential overpayments, where customers have not reported changes in their circumstances which affects their housing benefit entitlement.”

Housing benefit is paid directly to landlords.

It can also be given in the form of a bill reduction to those in social housing.

Department for Work and Pensions data reveals £7,460,000 had been flagged as outstanding across Renfrewshire at the end of the last financial year.

This represents an increase of almost 62 per cent since 2014.

Only £1.3m was recovered by March – just 18.5 per cent.

Figures show just over £1m has been written-off as non-recoverable in the last five years.

An overpayment can happen for various reasons.

The wrong amount can be paid due to a miscalculation in entitlement.

Claimants can also cause errors by failing to disclose a change in circumstances which may affect payouts.

Councils can choose whether or not to claw back an overpayment.

Local authorities have the power to seek redress, even if the mistake was their fault.

Deductions of up to £11.10 per week can be made from housing benefit to service the debt.

More than £ 150m was ruled outstanding across Scotland in the last financial year – with £11m written off.

The figures leapt 36 per cent from the £114 outstanding in 2014.

Fife has seen the biggest increase locally in the value of its outstanding overpayments.

It tripled from £3.1m in March 2014 to £9.3m in 2018.

Edinburgh has the biggest debt, with the amount outstanding rising to £25.8m.

Across Britain, the value of housing benefit overpayments outstanding at the end of March 2018 was around £2.13bn – up from £2.02bn a year before.

The local authority insisted the increase in overpayments in shortening in percentage terms.

The spokesman added: “The council has seen an overall reducing trend in the value of overpayments raised each year since 2014/15.

“It takes appropriate steps to ensure that overpayments are minimised and when the do occur they are rigorously recovered.”