Meeting of the Parliament 27 June 2018
I want to make progress at this stage, if that is all right.
The Convention of Scottish Local Authorities told the committee that it is rare for action to be taken to recover a debt that is more than five years old, but that any move to a five-year negative prescription period would—just like with the DWP—hurt the debtor most. Payments would either have to be recovered over a shorter period—and we must always remember that local taxes are recurring obligations that are due every year, so failure to make payment one year is likely to be compounded the following year—or councils would have to change the way they try to pursue and enforce payment, leading to substantially increased costs for councils, for the Scottish Courts and Tribunals Service and, more important, for the debtors themselves. The Scottish Government notes from the committee’s report that the committee has agreed to write to all 32 local authorities for more information about such debts.
Reserved social security spending in Scotland is still decided on the basis of rules that are set by the DWP, and that includes how it decides to recover any overpaid benefits. The DWP has made it clear to the committee that, if there was no exception from the five-year prescription for obligations to repay reserved benefit overpayments, debtors would be placed in a worse position than they are in now, as the DWP would have to recover the money over a shorter period, meaning that larger amounts would require to be deducted from a debtor’s benefits over a shorter period.
The Scottish Government does not have any jurisdiction over policy decisions concerning the operation of reserved benefits, and the committee is keen not to increase the financial hardship on vulnerable people in our society. The DWP is in control of the matter, and the Scottish Government hopes that the committee will join it in recognising the impact that making reserved benefit overpayments subject to the five-year prescription would have.