The Department for Work and Pensions has come under fire (Image: Getty)
Ministers have been accused of a “heartless scam operation” that frightens bereaved people into bolstering the Department for Work and Pensions’ coffers. The DWP has been writing to families informing them they need to return state pension payments allegedly made in error.
These direct payment after death (DPAD) overpayments happen if the DWP is not notified of the death in time to stop a payment. Though these are treated as non-recoverable and are not actually enforceable by law. The DWP can request the money back as a voluntary payment.
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But Dennis Reed, director of over-60s campaign group Silver voices, warned this is an “official scamming exercise to frighten the recently bereaved into bolstering the DWP coffers”. He said: "This a scandalous DWP policy, using the dates of death certificates to try and screw a couple of weeks' pension payments from grieving relatives, at a time when funeral costs are soaring. Because there is no legal liability on relatives to repay part of a monthly pension, this is a heartless scam operation which must be stopped immediately. Silver Voices calls on the DWP to ensure that this policy is scrapped. "
Sir Steve, who now is a partner at pension consultants LCP, previously sent a freedom of information request (FOI) to receive a copy of the letter that gets sent to reclaim overpayments.
He said: “Nowhere does it say that this is voluntary."
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The letter has a frequently asked questions (FAQ) section but none of the questions in it are "do I have to do this?", Sir Steve noted.
He added: "And the result, I fear, is that it’s a lottery, and the losers of the lottery are people who are intimidated or frightened or upset by a letter. You know, they’ve just been bereaved.
"They get a letter from the Government demanding hundreds of pounds back, and they just send it because they think they have to.
"They don’t want, you know, they perhaps fear a knock at the door kind of thing, whereas other people, who perhaps are aware they don’t have to pay it back or just choose not to, don’t."
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Either the law should state that everyone is obligated to pay the money back or the Government should stop requesting repayments altogether, Sir Steve explained.
He said: "This kind of halfway house of … we know that it’s not mandatory when we send the letters, but we’re not going to tell you...that doesn’t seem right to me."
The DWP acknowledged that there is no legal obligation to repay such overpayments but said it has a responsibility to attempt to recover the funds.
Pensioner Phil Ellaway, 68, accused the department of "scamming" vulnerable people after he received a letter following his wife's death in October aged 66.
The DWP had claimed that they incorrectly paid ￡537.20.
Phil said: "My initial reaction was, by the tone of the letter, I had done something wrong or illegal."
He contacted the department who failed to tell him why their debt centre had been in touch with him despite no previous communication.
Phil was told the letter is only sent once and there is no liability to pay the money.
But he accused the DWP of "preying" on bereaved people who were grieving, adding: "I am disgusted that these people are doing this to families who are at a low ebb."
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A DWP spokesman said: "It is not our intention to cause distress, however, we have a responsibility to taxpayers to recover overpayments. We acknowledge this is not always possible.
"Whilst there is no legal obligation to repay a debt of this type, we recognise some people will be willing to repay money to which there was no entitlement. We provide full contact details and encourage anyone with concerns to call us."
It is understood that no further letters are issued requesting payment if the DWP does not receive a response and that an initial recovery is attempted from the bank where the payment was made or from the deceased’s next of kin.
By Dennis Reed, director of Silver Voices
Phil’s story is scandalous in its own right, but typifies what is wrong with the culture in the Department of Work and Pensions. This is a Department which is supposed to ensure that those on low incomes or have fallen onto hard times have enough to live on; and it is also responsible for administering our essential state pension system. By any yardstick the DWP is a failing and dysfunctional organisation, and the way it treats claimants is remote, bureaucratic and inhumane.
It is difficult these days to speak to a human being at the DWP, as everything is automated and digital, which compounds the impersonal approach.
How can Phil’s treatment be justified? Still grieving for his wife, he is told by letter that he must repay a proportion of her monthly pension from the day she died.
There is no legal basis for such a claim and in conversation with a DWP official he is told as much, and that the “debt” will not be followed up.
It is clear that this is official DWP policy and not a rogue request or administrative error.
This is nothing more than an officially sanctioned scam to boost DWP coffers.
It is particularly sad that the impact of such policies on bereaved families is not taken into account. It is not as if any errors have been made as the state pension was received while Phil’s wife was still alive.
How does the DWP know that the whole state pension was not utilized to pay essential bills almost as soon as it was paid in. And if anything at all was left over it could go on the exorbitant costs associated with the death of a dear one.
The DWP needs to go back to its core principles, eliminate inhuman practices like this and show genuine concern and empathy when people are experiencing critical life events.
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