Redundant & Natwest keep taking my benefits

[Emmab]

Hi,

I am looking for some help in relation to Natwest bank charges.

I was made redundant at the beginning of Feb, the only income i am currently receiving is job seekers allowance and family tax credits. (which is not alot anyway!)

On 3 occasions now since the beginning of Feb Natwest have taken this money out of my account for bank charges ..... what do they expect me and my 5 year old son to live on??

This morning i received my final pay packet of £199 from my previous job and guess what .... natwest took £60 of it.

Are they allowed to take benefits and child tax credits (which are for my son) out of my account as and when they like??

I have spoken to Natwest but as usual they are not interested.

Can anybody give me some advice please?

Thanks x

[StoneLaughter]

Re: Redundant & Natwest keep taking my benefits

Under s187 of the Social Security Administration Act 1992, it is not lawful to levy charges against benefit payments of certain types. The text of the act is shown below:

187.—(1) Subject to the provision of this Act, every assignment of or charge on–

(a) benefit as defined in section 122 of the Contributions and Benefits Act; [3(aa) a jobseeker’s allowance;]

(b) any income-related benefit; or

(c) child benefit,

and every agreement to assign or charge such benefit shall be void; and, on the bankruptcy
of a beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of
his creditors.

You can write to your bank quoting this legislation to them and expect them to refund - however they are likely to fight you.

[Mochamoo]

Re: Redundant & Natwest keep taking my benefits

Hi Emmab,

Sorry to hear about your redundancy. Have you thought of setting up another account just for your benefits to be paid into like a post office account or a credit union account that way Natwest can not touch it ?

I hope you find a new job soon x

[michael]

Re: Redundant & Natwest keep taking my benefits

Under s187 of the Social Security Administration Act 1992, it is not lawful to levy charges against benefit payments of certain types. The text of the act is shown below:



You can write to your bank quoting this legislation to them and expect them to refund - however they are likely to fight you.

The two Acts of Parliament that govern how benefits are paid are the Social Security Administration Act 1992 and the Tax Credit's Act 2002. Both of these have clauses which apparently make it unlawful for banks to impose bank charges on benefits:


HOWEVER by 'charges' they DO NOT MEAN BANK CHARGES. What is meant is things like attachment of earnings and charging orders.

Although there is some ambiguity, if you took a case to reclaim bank charges to court based on s187 of the Social Security Administration Act 1992 or s45 of the Tax Credits Act 2002 the court would almost certainly find against you.

No one is saying that the banks have the right to take money from benefits, only that you can't use the Social Security Administration Act 1992 or the Tax Credits Act 2002 to stop them. Money taken from benefits is unlawful - but unlawful by virtue of the Unfair Terms in Consumer Contract Regulations 1999, not under the Social Security Administration Act 1992 or Tax Credits Act 2002 (unfortunately).

Government Response to Petition

“We the undersigned petition the Prime Minister to compel the High Street banks to obey the law on state benefits.”

Details of Petition:
“It is government policy that people on state benefits (income support, tax credits, etc) have their benefit paid into a bank account. All High Street banks impose charges on banking accounts for going overdrawn, not having funds to cover a direct debit,etc. In the case of accounts which have money from state benefits payed into them , such charges are contrary to section 187 of the Social Security Administration Act 1992 or section 45 of the Tax Credits Act 2002. However, the High Street banks continue to ignore this legislation. This petition is to request the Prime Minister to compel the High Street banks to obey the law.”

The Government’s response
The purpose of the Social Security Administration Act 1992 Section 187 and section 45 of the Tax Credits Act 2002 is to prevent people’s benefit money being at risk by it being assigned over to a third party in settlement of a debt. It is not intended to prohibit the application of bank charges. Bank charges are in the nature of an expense, and are incurred by the holder of the account; tax credits and benefits are payable in order to help customers meet their expenses, and as such it is legitimate for banks to deduct charges from the balance of an account held in that bank, whether the money paid into the account comes from tax credits, benefits or other sources, such as earnings.

Full response here:
[1]

Legal Beagles

[StoneLaughter]

Re: Redundant & Natwest keep taking my benefits

I stand corrected; apologies for any confusion caused.

[Amethyst]

Re: Redundant & Natwest keep taking my benefits

Hi,

I am looking for some help in relation to Natwest bank charges.

I was made redundant at the beginning of Feb, the only income i am currently receiving is job seekers allowance and family tax credits. (which is not alot anyway!)

On 3 occasions now since the beginning of Feb Natwest have taken this money out of my account for bank charges ..... what do they expect me and my 5 year old son to live on??

This morning i received my final pay packet of £199 from my previous job and guess what .... natwest took £60 of it.

Are they allowed to take benefits and child tax credits (which are for my son) out of my account as and when they like??

I have spoken to Natwest but as usual they are not interested.

Can anybody give me some advice please?

Thanks x

I would do as Mochamoo recommended and have your benefits paid to another account, such as a post office account. They are allowed to take charges from Benefits (annoyingly and nastily I think)

What are the charges for ?

If you can't/don't want to move any DD payments out of the bank then you need to look at your incomings/outgoings and minimise the risk of getting charges (well you need to do that anyway really)

Natwest still take charges as soon as they are incurred which makes using things such as the First Right of appropriation difficult, although if you are concerned your next benefit payment into the account will get eaten by charges you can try sending in a letter explaining what the money needs to be used for for essential living expenses - have a look First Right of Appropriation - Legal Beagles

You can also send a letter in, stating hardship, and asking for the charges to be refunded, as they are unfair.

[WendyB]

Re: Redundant & Natwest keep taking my benefits

If you do decide to set up anothr account, ring the Child Benefit/crdit mob as soon as you have your new account details. They are quite helpful and can "suspend" a payment then send it to your new account with only a couplefew days delay. Thats what they did for me anyway, when I knew my child benefit was about to be swallowed by my overdraft and natwest's charges. I think you need to call them at least a couple of days in advance of the payment being due, but not exactly sure on that timescale. Might be worth ringing them anyway to find out what the best way to go about changing accounts is, and what the timescale is, so then you will be prepared and ready for action.