Social Security Administration Act 1992-Section 187

[jax50]

Anyone know how this works ?
As I understand it if a Bank tries to take any benefit you are receiving (Child Benefit etc) to settle a debt, it is illegal and you can recover the past 6 years of any monies taken. The Act says these are inalienable. In other words benefits can not be used to settle charges, fees etc.

Now, I have a question for anybody who knows about this Act. Anyone who is receiving Benefits and who has to submit an I/E form to a Bank to agree payments of a debt from any net 'surplus' will normally include benefits within this I/E schedule. Does this Act say that benefits could be left out of the I/E schedule as effectively any surplus could be entirely made up of the benefits received and thus the Bank will be claiming that money as a repayment against the debt, a debt made up probably of Fees, Charges, interest as well as expenditure. ?

Observations anybody ?

[bluebottle]

Re: Social Security Administration Act 1992-Section 187

In order to prevent banks taking benefits to offset debts, you need to speak to DWP about an alternative method of payment.

[jax50]

Re: Social Security Administration Act 1992-Section 187

In order to prevent banks taking benefits to offset debts, you need to speak to DWP about an alternative method of payment.

Should the method of payment matter if it is illegal ?

[bluebottle]

Re: Social Security Administration Act 1992-Section 187

DWP do, in fact, tell you that if you find a bank is taking your benefits to pay off debts, you should contact DWP about an alternative method of paying you benefits to ensure you receive it. They will be able to advise on the alternative payment methods available.

[Tom_Brennan]

Re: Social Security Administration Act 1992-Section 187

I researched this topic some time ago, and my understanding of the application of this section is as follows:

Any assignment of your state benefits or pension is void and unenforceable. That is to say, no person or organisation can collect your state benefits/pension in your place as settlement of a debt (subject to certain exceptions involving state institutions). As a result, you could not instruct the DWP to pay your benefits to a 3rd party, and a 3rd party could not enforce any agreement that gives your state benefits to them. This was introduced at the end of the 1800s to stop the first state benefits (such as war pensions) being taken by unscrupulous 3rd parties, which happened an awful lot.

However, under current banking law, once your benefits (or indeed, any other income) is paid into your account, it is no longer classified as your benefits; it becomes part of a generic monetary debt owed to you (if your account is in credit) or owed by you (if your account is in debit). Think of your benefits as a glass of water, and your bank account as a water tank. S.187 effectively strikes down any agreement that stops your weekly glass of water going into your water tank and/or going to somebody else's water tank. That water is for you and you alone. However, once you have put it into your water tank, it is just becomes part of the whole collection of water that is in there, and can no longer be protected. The practical reason is that you couldn't identify which of those water molecules (your pennies) that came from your glass (benefits), and which were in there already.

The only way to protect your benefits is to have them paid into a separate account with a separate bank, which avoids any set-off (think of this as the bank linking up any water tanks that you have with them to get the overall amount of water you have stored with them or borrowed from them). A number of banks work with fast transfer payments, so you should be able to move your money from your benefits account with one bank to another account with another bank (such as your house or bills account) within two hours. This is the best way to protect your benefits from everyone and anything.

I hope this helps.

[jax50]

Re: Social Security Administration Act 1992-Section 187

I researched this topic some time ago, and my understanding of the application of this section is as follows:

Any assignment of your state benefits or pension is void and unenforceable. That is to say, no person or organisation can collect your state benefits/pension in your place as settlement of a debt (subject to certain exceptions involving state institutions). As a result, you could not instruct the DWP to pay your benefits to a 3rd party, and a 3rd party could not enforce any agreement that gives your state benefits to them. This was introduced at the end of the 1800s to stop the first state benefits (such as war pensions) being taken by unscrupulous 3rd parties, which happened an awful lot.

However, under current banking law, once your benefits (or indeed, any other income) is paid into your account, it is no longer classified as your benefits; it becomes part of a generic monetary debt owed to you (if your account is in credit) or owed by you (if your account is in debit). Think of your benefits as a glass of water, and your bank account as a water tank. S.187 effectively strikes down any agreement that stops your weekly glass of water going into your water tank and/or going to somebody else's water tank. That water is for you and you alone. However, once you have put it into your water tank, it is just becomes part of the whole collection of water that is in there, and can no longer be protected. The practical reason is that you couldn't identify which of those water molecules (your pennies) that came from your glass (benefits), and which were in there already.

The only way to protect your benefits is to have them paid into a separate account with a separate bank, which avoids any set-off (think of this as the bank linking up any water tanks that you have with them to get the overall amount of water you have stored with them or borrowed from them). A number of banks work with fast transfer payments, so you should be able to move your money from your benefits account with one bank to another account with another bank (such as your house or bills account) within two hours. This is the best way to protect your benefits from everyone and anything.

I hope this helps.

That is very interesting and well explained ...thank you.

However (there's always an However)...
Forget the Bank....Ponder on this scenario... Completing an I/E with all incomes and outgoings to provide to a Creditor or Court?, to ascertain how much of a debt might be paid off each week.. If there are benefits being received should they be included or not ?

Consider...
£
Wages....100
Benefits 20
Rent (50)
Food (50)
net 20
So the £20 becomes available to pay Creditors off, but hold on...isn't the £20 from benefits ?

While it isn't being hijacked from source, it's still the same £20...isn't it ?

[bluebottle]

Re: Social Security Administration Act 1992-Section 187

All the more reason to speak to the DWP. Ring them tomorrow.

[Bill-K]

Re: Social Security Administration Act 1992-Section 187

Ring DWP, Jax - but I suspect this is one of those 'grey areas,' where you'll be given all sorts of advice and opinion. I think it is important to get it in black and white - with provenance, as I daresay it will be challenged. Try and get DWP to supply references to the regulations and law.

Tom's explanation seems unfair to me, but the assumed fairness of law often goes far deeper than that top layer of 'logic.' We may call the Law an ass, but that still won't make it budge when we want it to !!! Better to learn to ride it in the direction it wants to go, say I !!!

I sure do see what you're getting at with your example, where the £20 net exactly matches the £20 benefit. But I think the problem may be that the nature of most benefits is that they are provided to cover for such essential expenses as food, rent, leccy, etc. BUT - once we have been paid them, it is up to us to allocate them as we wish - although we may still yet be judged on our choice of allocation !!!

Once the benefit has been tipped into our 'pool,' then we are no longer forced to accept whatever the benefit provider decides that the 'allocation' should be, and are free to choose our own. Thus - the benefit then becomes nomore than a contribution to our meagre 'wealth.' I think in the eyes of the Law, the £20 example above must be seen as no more than coincidence, as it would have been £15 if we had decided to spend a fiver on scratchcards (with the best of hopes and intentions, I hasten to add !!!)

Inconvenient, though it may be, I believe that 'letting the ass go where itwants' is probably the best way to deal with this. So - opening something like a Co-op 'Cashminder' account for benefit receipt seems the best path to take. The Ass is happy, and we get what we want, too.

LOL - "Render unto Caesar that which is Caesar's" !!!

[jax50]

Re: Social Security Administration Act 1992-Section 187

Bill-K Thanks for that. Yes I tend to agree with what you say. Of course I deliberately massaged the figures to emphasise the point I was trying to make. The argument regarding how the benefit is received and does it or is it intended that it goes in the same pool of water...well, if the law states that benefits can not be ambushed at receipt by assigning before it enters the pool, then what does that tell us ? That tells us that the benefit should be allowed to go in the pool and it is then presumably at the discretion of the recipient as to how and where that is used. So, Child benefit is spent on scratch cards, Housing benefit spent on Food........who is to know and does it matter ?

The Benefit system means tests to assess what you 'need' to pay certain bills or to live on The measures the Govt use, like Housing benefit or disability benefit, or do you have children and qualify for child benefit are source based...but once received are entirely disposable as the recipient deems fit ?

So where is the logic then that says DCA's are not allowed to hijack the benefits at source, but are entitled to take it from the pool ?
If my example above had been

Wage 100
benefit 20
rent (50)
Food (50)
Other (20)
net ..0

So what does the DCA take then in monthly repayments ? The recipient has spent the £20 on scratch cards...

[Bill-K]

Re: Social Security Administration Act 1992-Section 187

I sure can see what you're saying, Jax, and I agree that it literally doesn't seem to 'add up.' TBH, I prefer your argument to Tom's - but in fairness to him, that's his interpretation of the law, and whether he agrees with it or likes it is another matter. This 'loss of identity' when benefits are paid into the pool is the obstacle, and it seems to me that perhaps this is the cost we pay of having the freedom (legally, if not morally !!!) to spend our benefits on virtually anything we want, once they have been tipped into the pool. We (mostly) do not have to spend those benefits on whatever they were prescribed for. For example, we still get Child Benefit for our daughter - but she never gets to see the £20-odd per week we get for her. Some weeks, she gets nowt. Other weeks, she gets a birthday !!! We have that freedom. I don't do scratch-cards, but I admit to doing online Lottery. I have the freedom to use our kid's CHB for that if I so wish. I prefer that freedom to being made to account for every penny of whatever benefits we get - which would of course just be impossible. I think 'the pool' is the price we have to pay for that, and I've been lucky not to have my bank try and 'nick' my benefits. But for those who are fighting that, then I sure can empathise with them - because I've come damned close to it at times.

Another 'illustration' I'm thinking of is Housing and Council Tax Benefit. In many - or perhaps all - cases, the benefit is administered by our local council, and claimants are not sent a cheque or a bank inpayment to cover their CT. And in many (or all ?) cases they are not sent their HB as a benefit payment. Their CT account is simply credited with the benefit, as is their rent account if they are 'Council' tenants. Now, THAT benefit is untouchable by either the bank OR the beneficiary - so it never enters the 'pool,' and retains its identity throughout. As MC Hammer said a while ago..."You cain't touch this...!!!"

And we can't. We can't use for anything other than its intended use. It seems that - as soon as we avail ourselves of the freedom to do otherwise, those benefits lose the protection of the Law, as they have lost their 'identity.'

It would be a right royal administrative butt-pain, but we could probably arrange for the 'prescribed percentages' of our benefits to each be directly paid to our food, energy, clothing suppliers, etc., but if we simply open a basic account for receipt of these benefits, then it seems to afford us the freedom NOT to have to allocate so precisely, whilst still preserving our right to access those benefits. Perhaps we should make sure we pay Tesco (or RLP if you have a young klepto-kid), British Hot Air and UK FC (!!!) directly from our benefits account, and pay Lotto & Sky-Porn etc. from the other, though - just to be nice !!!

It's not the answer, is it, but it seems to justify the Law according to Tom - enough to satisfy me.

[Lawful Albion Rebel]

Re: Social Security Administration Act 1992-Section 187

Seems to me the issue is whether a private for-profit enterprise like a bank, should be entitled to arbitrarily seize a fee from someone's account, simply because they are having to live 'in the red' on an arranged overdraft, and which after all, consists entirely of money that doesn't really exist anyway (see fractional reserve banking). And especially if the sole income into that account is benefits. I think a test case may be in order.

[smith]

Re: Social Security Administration Act 1992-Section 187

hi is there a template letter to send bank take charges from your benefits please

[FlamingParrot]

Re: Social Security Administration Act 1992-Section 187

hi is there a template letter to send bank take charges from your benefits please

Sadly the Social Security Admin Act 1992 is widely misunderstood to mean a bank cannot apply charges to your account if you are on benefits. In reality, it refers more to things like not obtaining an order to make deductions from your benefits, for example, to pay a CCJ, although small deductions from benefits can be made to repay certain types of debt, such as court fines, CSA and maintenance payments.

See this for reference: http://www.consumerwiki.co.uk/index....nistration_Act

A Barrister's view:

I researched this topic some time ago, and my understanding of the application of this section is as follows:

Any assignment of your state benefits or pension is void and unenforceable. That is to say, no person or organisation can collect your state benefits/pension in your place as settlement of a debt (subject to certain exceptions involving state institutions). As a result, you could not instruct the DWP to pay your benefits to a 3rd party, and a 3rd party could not enforce any agreement that gives your state benefits to them. This was introduced at the end of the 1800s to stop the first state benefits (such as war pensions) being taken by unscrupulous 3rd parties, which happened an awful lot.

However, under current banking law, once your benefits (or indeed, any other income) is paid into your account, it is no longer classified as your benefits; it becomes part of a generic monetary debt owed to you (if your account is in credit) or owed by you (if your account is in debit). Think of your benefits as a glass of water, and your bank account as a water tank. S.187 effectively strikes down any agreement that stops your weekly glass of water going into your water tank and/or going to somebody else's water tank. That water is for you and you alone. However, once you have put it into your water tank, it is just becomes part of the whole collection of water that is in there, and can no longer be protected. The practical reason is that you couldn't identify which of those water molecules (your pennies) that came from your glass (benefits), and which were in there already.

The only way to protect your benefits is to have them paid into a separate account with a separate bank, which avoids any set-off (think of this as the bank linking up any water tanks that you have with them to get the overall amount of water you have stored with them or borrowed from them). A number of banks work with fast transfer payments, so you should be able to move your money from your benefits account with one bank to another account with another bank (such as your house or bills account) within two hours. This is the best way to protect your benefits from everyone and anything.

Tom Brennan, Barrister

[smith]

Re: Social Security Administration Act 1992-Section 187

Sadly the Social Security Admin Act 1992 is widely misunderstood to mean a bank cannot apply charges to your account if you are on benefits. In reality, it refers more to things like not obtaining an order to make deductions from your benefits, for example, to pay a CCJ, although small deductions from benefits can be made to repay certain types of debt, such as court fines, CSA and maintenance payments.

See this for reference: http://www.consumerwiki.co.uk/index....nistration_Act

thanks was reading this part a 3rd party could not enforce any agreement that gives your state benefits to them. This was introduced at the end of the 1800s to stop the first state benefits (such as war pensions) being taken by unscrupulous 3rd parties, which happened an awful lot.



so were you are in debt and on benefits ie credit card the agreement cannot be enforced by a debt purchaser 3 party as you would have to give them your state benefits to cover the debt so your debts and credit agreements when on benefits could be unenforceable or am i wrong

[FlamingParrot]

Re: Social Security Administration Act 1992-Section 187

thanks was reading this part a 3rd party could not enforce any agreement that gives your state benefits to them. This was introduced at the end of the 1800s to stop the first state benefits (such as war pensions) being taken by unscrupulous 3rd parties, which happened an awful lot.

Indeed, that was the intention, and still is, pretty much, i.e. a creditor cannot get an "attachment of benefits" to pay back a CCJ, although like I said above, deductions from benefits can be made to pay certain things like maintenance and court fines, council tax arrears in some cases, but not CCJs.

so were you are in debt and on benefits ie credit card the agreement cannot be enforced by a debt purchaser 3 party as you would have to give them your state benefits to cover the debt so your debts and credit agreements when on benefits could be unenforceable or am i wrong

I'm afraid you are wrong, precisely for the reasons above, i.e. they can't legally obtain an attachment from your benefits. They can still enforce the debt as far as obtaining judgment (a CCJ), but they can't enforce it further if the individual has no income other than benefits, in which case you'd submit an income and expenditure form to the court and offer just £1/month towards the CCJ. In other words, they are not unenforceable for that reason, but there's little point in obtaining a CCJ in those circumstances, which is why creditors often don't bother with people who don't own property to secure the debt on via a charging order.