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'I have nothing': DWP takes millions from benefit claimants every year to pay for its own mistakes

The DWP is leaving benefits claimants with 'nothing' after accusing them of owing thousands of pounds in overpayments. The Big Issue spoke to single mothers who have been impacted

benefits claimants hit with overpayments

Rebecca Kallaway, Penny Davis and Jane Wardle are among the mums hit with bills by by the DWP. Images: Supplied

The government is trying to seize back hundreds of millions from benefit claimants each year to rectify its own mistakes.

This plunges some of the most vulnerable people in the country into thousands of pounds of debt, leaving them “devastated” and “with nothing to live on”.

In some cases, even the allegations of debt are incorrect. 

A single mother who spoke to The Big Issue was falsely accused of owing the Department for Work and Pensions (DWP) more than £12,000. 

Penny Davis was told she had been paid too much in universal credit and had to return that money to the DWP or it would be deducted from her wages.

In reality, the DWP actually owed her more than £2,000, which she is yet to receive.

“I’m absolutely devastated. It changed everything for me,” Davis said. “Getting that letter and thinking that I’d have to pay that back made me very fearful of ever claiming again.”

It comes amid renewed outrage around the Post Office scandal, another example of a powerful public body accusing innocent people of owing huge amounts of money.

The DWP overpaid £8.3bn to benefit claimants between April 2022 and 2023. Although alleged fraud accounted for £6.5bn of this, many people face debt because of mistakes made by the DWP.

Penny Davis was left “devastated” after the accusation. Image: Supplied

The department has admitted that £600m of benefit overpayments during this time period was a result of its own errors, while a further £1.4bn was because of innocent mistakes by the claimant.

Responding to Davis’s case, a DWP spokesperson said: “We sincerely apologise for this error and the customer is being reimbursed. The rate of universal credit overpayments due to official error, such as this, is currently at 0.6% – its lowest ever.”

But even at its lowest ever, this is still impacting a huge number of people. In 2023, Citizens Advice helped 17,090 people with benefit overpayments.

In the past, the DWP would pick up the tab if it made the mistake, but now claimants are often expected to pay. This can leave households facing years of debt and having money taken from their benefits, all because of a DWP mistake.

Jane Wardle, another single mum, has been accused of owing the DWP £24,800. She started claiming universal credit in 2019 when she found herself unemployed following the completion of her master’s degree.

After receiving funding for a PhD, she was told by the Jobcentre that she could keep claiming universal credit. Nothing was flagged at her annual review. But then in summer last year, she received a letter saying she had been overpaid and now owed the DWP all that money back.

Wardle’s universal credit was stopped immediately and she was forced to turn to a food bank to feed herself and her daughter. 

Jane Wardle’s health has suffered as a result of the debt. Image: Supplied

“It has literally left me with nothing to live on,” Wardle, who is 38 and from Darlington, says. She has taken on work as a cleaner on top of her PhD to survive.

She put in an appeal and the case was taken to tribunal. The judge was supportive and encouraged Wardle to keep fighting but, unlike in Davis’s case, overpayments had been made and there was nothing that could be done. She now has a huge debt hanging over her.

“My health has suffered,” she adds. “I got shingles in my face from the stress and I’ve just been really rundown. My fibromyalgia has been bad.”

A DWP spokesperson added: “We carefully balance our duty to the taxpayer to recover overpayments and safeguards are in place to help people manage repayments.”

The DWP is currently considering steps it can take to crack down on benefit fraud, such as giving staff powers to “arrest and carry out search and seizure”. The department is also set to be given powers to snoop on benefit claimants’ bank accounts if fraud or error is detected. 

Susannah Copson, legal and policy officer at Big Brother Watch, previously told The Big Issue: “Algorithms make mistakes. The consequences [of the new powers] could be dire, resulting in people unable to afford essentials like rent or bills. 

“The echoes of the Horizon scandal are palpable, and these powers pose a massive risk of recreating such injustices on a broader scale. People on the poverty line, people with disabilities, who are sick or disabled, or are elderly, amongst others would be most at risk.”

Campaigners say the government should fix its own operations before turning on benefit claimants – because the human impact of error can be enormous.

Ruth Talbot, the founder of Single Parent Rights, said: “We regularly hear from single parents facing overpayment demands from the DWP. The DWP needs to urgently review all these cases, and reassess how their decision making processes work to ensure these mistakes stop happening.”

Single Parent Rights is calling for repayment demands to be capped at 5% of benefit payments, “to ensure families aren’t plunged into significant hardship for errors made by the DWP”.

Wardle says: “It’s so unjust. It’s against people. It’s the whole system and the DWP in general. Everything is a constant fight. Policy needs to change.”



Vikki Reid faced a similar situation when she was hit with a £21,000 bill by the DWP after an error with her universal credit payments. She is a widowed mother and PhD student, and the DWP had made the mistake of treating her stipend as a postgraduate loan.

“After getting that letter, I interrupted my PhD,” Reid said. “I was in a level of shock. I knew how much it was going to change my life. It comes second to getting a phone call saying my partner had died when we had a young baby. I knew that it was going to change the course of my life.”

Reid is a minority within her department as a woman studying engineering. She has caring responsibilities for her son, who is in primary school, so she is unable to study full time and cannot get the full rate of funding for her PhD. 

She feels “penalised” as a single mother and it has impacted her son too.

Vikki Reid and her son have both been impacted by the mistake. Image: Supplied

Reid said: “I was getting stressed about what we were eating and saying if I put it on the table in front of him, he had to eat it because there wasn’t anything else. He was very aware that his school uniform wasn’t fitting very well. We’re lucky that we’ve had hand-me-downs. I was quite literally watching the pennies. It definitely affected him.”

Ayla Ozmen, Director of Policy and Campaigns at Z2K, said: “People should be able to trust the department to get its own rules right without fearing it will later turn around and demand repayment.

“Unlike with older benefits, overpayments in universal credit are almost always recoverable – even when it’s entirely the department’s mistake and the claimant has shared all relevant information. This unfair rule puts recipients on the hook for DWP’s errors, and should be abolished.

“And any deductions come out of already inadequate universal credit, meaning DWP’s mistakes not only saddle people with debt, but in many cases push them even further into poverty.”

But it is not just universal credit claimants who are impacted by overpayments. Another mum who has been supported by Single Parent Rights has been accused of owing £4,000 after being overpaid working tax credits. HMRC claimed it’s because her salary increased and they had not accounted for that.

“They rely on the fact that people don’t have the means to fight it because there’s no legal aid anymore,” Elena, who has asked for her name to be changed, says. 

The 46-year-old from Norwich has had to take time away from her work in the charitable sector because she has panic attacks at night, waking up feeling as though she could not breathe.

“It’s not just me that suffers from this situation. It’s the children that suffer. We find ourselves staying at home. I’m turning the heating off while I’m at home and relying on blankets. I’ve got arthritis and Raynaud’s disease, so I shouldn’t be doing that. I’m actually in physical pain because of having to cut back on money.”

An HMRC spokesperson responded: “The overpayment the customer received was caused by their income significantly increasing, which resulted in their tax credit award being reduced.

“We confirmed this newly identified income and the subsequent overpayment in two separate notices in April 2023. We take a supportive approach to dealing with customers who have tax credit debts and if the customer is struggling we would encourage them to contact HMRC so that we can look at options to support them.”

But Elena believes she was treated unfairly as a result of their mistakes. She said: “I guarantee if we made an error it would be sanctions, fines and threats.”

Halide Kalfaoglu, benefits expert at the charity Turn2us, says: “Demanding large repayments from claimants, especially single parent families, leaves people in serious financial difficulty. The DWP should not be penalising claimants for administrative errors. Any repayments need to be calculated fairly and they should work with people to offer repayment plans that they can afford.

“Benefits overpayments can be very complex and require a detailed investigation to understand what went wrong. Claimants are usually required to go to a tribunal and will need support to either challenge the overpayment or request a waiver of recovery. We recommend that people seek timely advice, especially from debt organisations, to receive the support they need throughout this process.”

Kellaway said the overpayments left her and her daughter in “bad poverty”. Image: Supplied

Another mum, Rebecca Kellaway, faced a similar situation when she was moved from working tax credits to universal credit in 2019. It came without warning after she had taken on two extra hours of work temporarily cleaning.

“I was immediately in really bad poverty,” she said. “I had to rely on two food banks.”

She explained: “There was no warning. I hadn’t been able to save up any money. I was just living paycheck to paycheck.”

It was a £900 overpayment in working tax credits, and money was deducted from her benefits each month. Universal credit already falls short of the money people need to survive by about £140 each month, according to estimates from the Joseph Rowntree Foundation.

Kellaway said: “I was really struggling with everything, behind on all my bills, behind on my rent, behind on everything. I’m still struggling now.”

It has had an impact on her daughter too, who was just five at the time. “It’s the mental health impact, the stress of it, not having access to good amenities, not being able to just provide the very basics, the house often being cold, poor quality food or not enough clothes. I think it really has affected my daughter. I think she has grown up a bit too soon.”

If you have been accused of benefit overpayments, you might be able to challenge it. Citizens Advice has advice for people who have been hit with benefit overpayments here. A benefits advisor or debt advisor may also be able to offer advice. You can find local, independent advice agencies through Advice Local.

Gingerbread provides advice and practical support for single parents, including advice on benefits and tax credits. You can call their helpline for free on 0808 802 0925.

Do you have a story to tell or opinions to share about this? We want to hear from you. Get in touch and tell us more.

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