OXFORD City Council could get stung in the pocket by the Government for paying out too much money in benefits.

The local authority has given claimants too much housing benefit on too many occasions, which means it may have to hand back thousands of pounds to the Government.

The council is given a subsidy to help fund the administration of housing benefits but if it overspends by too much, it must give some – or all – of this back.

Officers at the city council have warned it may have to return more than £250,000 unless the issue is brought back under control.

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Green city councillor Craig Simmons, chairman of the scrutiny committee, said: “The fact is it is not good for the benefit claimants who will have to pay this back.

“It doesn’t work for the broader taxpayer either, because we are being penalised for running a bad service. It is a lose-lose situation.”

He said the council needed to identify the issue earlier.

A report compiled by council officers warned benefit overpayments had to fall below a certain threshold by the end of the financial year, otherwise the council would have to pay back part of the money it used to administer the handing out of housing benefits.

If a council’s overspend was between 0.48 per cent and 0.54 per cent of the total amount of correct payments then it would only keep 40 per cent of its subsidy.

And if the overspend was more than 0.54 per cent, then it would keep none of its subsidy.

In the first quarter of 2014/15, the city council overpaid housing benefits by £900,000, of which £700,000 had been recovered or paid back by the claimant, placing it in the middle bracket.

If action is not taken the authority could have to pay back £257,000 – or 60 per cent of the total £430,000 subsidy.

City councillor Ed Turner, the executive board member for finance, said the overspend looked higher because council tax benefit had been localised.

He said: “The key issue is that the Government has changed the way in which they calculate this. Previously the overall amount of benefit spent included council tax benefit but that is not included anymore.

“What that does is mean that the proportion of overpayment looks higher, so overall our performance looks worse rather than our benefits team not processing claims very well all of a sudden.

“We are working hard to get a grip of this and some quite robust management actions have been put in place. We have not had to pay back anything yet and the issue is about the amount we could have to pay back if we aren’t able to reduce it.

“We think this will get much better because of the management actions that have been put in place.”

He added the money would be covered by any underspends in other council departments.

Have you been paid too much in benefits by Oxford City Council and have had to pay it back? If so, contact reporter Damian Fantato on 01865 425429.

 

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