If you’re on a low income and you’ve been hit with a fine, you could face even greater hardship thanks to government rules that allow third parties to deduct debt payments directly from benefits.
Under the Fines, Council Tax, and Community Charges Regulations 2013, the Department for Work and Pensions (DWP) can take a fixed amount from benefit payments to clear fines and other household arrears like council tax and utility bills.
The policy takes power away from benefit recipients over already-limited finances, and in many cases forces people to spend cash that would have gone to essentials like clothes and food, on fines and monthly bills.
- The deductions can be made with no reference to the individual’s financial or personal circumstances.
- DWP can take action when requested by creditors.
- The rules allow DWP to reduce Universal Credit after deductions to 1p if necessary.
Research by the StepChange Debt Charity says the use of third-party deductions is making it harder for vulnerable families to cover the necessities of life, forcing them to use credit and creating a debt spiral as they struggle to stay ahead of bill payments.
The study found that more than 25 per cent of people having money deducted by DWP had two simultaneous deductions in place, while another 10 per cent had three deductions.
People in a vulnerable position were also more likely to report having debt payments deducted from their benefits. More than a million deductions are taken in a typical month.
Understanding the rules
When deciding on a third-party deduction, guidance published by the Department for Work and Pensions says it will consider whether taking such action is in the interests of the person or family.
The DWP can make three deductions at any one time. It will apply an order of priority if more than three creditors apply to have deductions taken.
Before applying for a deduction, DWP requires creditors to have tried other methods to recover the arrears, for example, negotiating different ways of paying and managing bills.
There must also be a real prospect of enforcement action against the individual before a deduction is considered.
Despite the above considerations, in practice, DWP frequently acts swiftly and firmly on behalf of creditors – and with minimal consideration of individual circumstances.
A personal claiming Universal Credit can have a minimum of 5 per cent of an outstanding fine taken from their payment, up to a maximum of £108.35.
In our experience, DWP takes the maximum permissible amount as standard practice.
How much can DWP deduct from benefits?
What you can do
What DWP and it’s fines enforcement branch won’t tell benefits claimants is that they have the right to have decisions about third-party deductions reconsidered by the Court — and can ask to have their monthly deductions lowered.
An application can be made pursuant to s.51 of the Criminal Justice Act 1982 (‘variation of instalments’), which states that the Court has the power to vary an order for payment by changing:
- The number of instalments payable
- The amount of any instalments payable
- The date on which any instalment becomes payable
In practice this means that anyone having fines deducted from benefits payments could make an application to establish a reasonable payment plan, and set a more manageable monthly amount.
We may be able to help
Based on your personal circumstances and the circumstances of the fine, we may also be able to make an appeal to DWP to deduct only the minimum allowable in your situation.
As a highly successful firm of criminal defence solicitors, we are experts at resolving such situations. Our advice is free and impartial, and if you wish, one of our fully-qualified solicitors may be able to represent you.
Contact us if you would like us to make an application before the Court and we can advise you on the merits of the case. We may also be able to apply for legal aid where appropriate in order to represent you in Court.
For more information, contact us today on 0800 612 7128 (24hr) or visit https://www.cantpaymyfine.co.uk.