It was three weeks after Christmas when the bombshell letter arrived. Guy Shahar and his wife, Oksana, looked at each other in stunned disbelief.
They had followed the Guardian’s investigation into the carer’s allowance scandal that has left thousands of families with crippling debts and criminal records. Not once did they think they would join them.
“Important,” it read in big bold type. “You have been paid more carer’s allowance than you are entitled to. You now need to pay this money back”.
In some weeks, she was paid just 38p more than the threshold – but for that tiny infraction she is being forced to repay £64.60 each time, the rate of carer’s allowance at the time.
If the punishment for deliberately claiming more in benefits than you’re entitled to is simply to repay the benefits then there’s no incentive to not do it. If you get caught then you’re no worse off than if you’d not broken the law so why not do it?
Having said that, if the punishment for accidentally claiming more than you’re entitled to is so harsh then that is unfair.
I’d imagine that the process for both of the scenarios is the same but it definitely should have some human element in it where intent is taken into account.
The system should protect people from that by having proper checks before the money is paid out.
I’m not a lawyer or barrister, but there are already laws against fraud, which is what you are describing. There’s a huge difference between deliberately over claiming and making a mistake, and what the article is describing is at worst honest mistakes.
Uh, what? The incentive is not having to pay anything back by claiming the correct amount. They’re poor, that’s why they’ve applied for the benefit in the first place. They can’t afford to pay stuff back.
The reason this is punitive is literally because they’ve chosen the amount they’re able to manage and yet are hit with huge fines when they’ve “gotten it wrong” by small margins, some as low as 38p like in the article.
And as a poor person, every cent counts. That’s why you claim the maximum (or a bit more than you think you’ll ve given), since it’s the government’s job to actually calculate how much you’re “better off” than the other person and adjust the rates accordingly. Ideally, you’d just request something and get that something - you shouldn’t have to be the one to decide how miserable your misery is compared to other miseries.
Someone on benefits, especially someone caring for their sick child shouldn’t be an accounting expert. This isn’t the US, where 15 year olds are expected to do their own taxes (and pay a $15.000 service that does about 10% of the work for you), and even in the US if you fuck up the IRS mostly just tells you to cover the difference.
So, this system of “you dared to ask for ONE CENT MORE? Now you owe me ALL back” is not only asinine, but it doesn’t even fly in the US of all places.
If we want to punish people, then ask for, say, 2% interest on the overclaim. Taking ALL is more discriminatiry, since it rewards trying to claim an ungodly amount and hoping one of your £15k claims somehow goes under the radar.
All in all, not a good system.
Using something proportional would be a progressivs disincentive, and it will keep actual “accidental” overclaimants better off than malicious ones.
Unless your rich and break the law then the fine you a small amount relatively speaking and you made more by breaking the law.
A 7 million fine for stealing 1 billion in profits.
Just another day in late stage capitalism.
Of course someone usually has to go to jail for something so public, so Steve from accounting is getting his “jailbird bonus” and will be admitting to fraud, and spend 4 months in a
hotelcushioned cell. He also gets weekends off.