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<p>The Department for Work and Pensions (DWP) does not store information in a format
entirely commensurate with the question, but I can confirm that approximately £3 billion
Tax Credit debt associated to Universal Credit claimants has been transferred to DWP.
This debt relates to 2.4 million claimants, some of whom could appear more than once
in this total. The following table breaks this down and shows how much has been recovered
to date.</p><p> </p><p><strong>Tax Credit debt transferred to date</strong></p><p>
</p><table><tbody><tr><td><p><strong>Financial Year</strong></p></td><td><p><strong>Customer
Count</strong></p></td><td><p><strong>Values</strong></p></td><td><p><strong>Total
Recoveries</strong></p></td></tr><tr><td><p><strong>2016-17</strong></p></td><td><p>110.8k</p></td><td><p>£147.933m</p></td><td><p><strong>£6.261m</strong></p></td></tr><tr><td><p><strong>2017-18</strong></p></td><td><p>155.8k</p></td><td><p>£190.472m</p></td><td><p><strong>£37.987m</strong></p></td></tr><tr><td><p><strong>2018-19</strong></p></td><td><p>531.3k</p></td><td><p>£676.984m</p></td><td><p><strong>£109.091m</strong></p></td></tr><tr><td><p><strong>2019-20</strong></p></td><td><p>724.5k</p></td><td><p>£964.170m</p></td><td><p><strong>£213.693m</strong></p></td></tr><tr><td><p><strong>2020-21</strong></p></td><td><p>593.0k</p></td><td><p>£679.055m</p></td><td><p><strong>£206.041m</strong></p></td></tr><tr><td><p><strong>2021-22
YTD</strong></p></td><td><p>285.4k</p></td><td><p>£364.141m</p></td><td><p><strong>£61.838m</strong></p></td></tr><tr><td><p><strong>Totals
</strong></p></td><td><p><strong>2400.8k</strong></p></td><td><p><strong>£3,022.76m</strong></p></td><td><p><strong>£634.910m</strong></p></td></tr></tbody></table><p>
</p><p>During the same period, the Department wrote off £9.4 million Tax Credit debt
for approximately 5,700 customers. The latest HMRC forecasts suggest that a further
£2.4 billion is due to migrate to DWP Debt Management for future recovery. Therefore,
based on the value of debt transferred to date and the forecast of further debt that
will transfer, if all Tax Credits debt associated to UC claimants was written off
it would cost in the region of £5.4 billion associated to approximately 4 million
customers.</p><p> </p><p>The Department has a duty to protect public funds and an
obligation to ensure that overpaid benefit payments are recovered in accordance with
the appropriate social security legislation.</p><p> </p><p>The Department seeks to
recover benefit overpayments as quickly as possible without creating any undue financial
hardship to the claimant. The rate of deduction is determined by legislation and can
only be calculated once other higher priority deductions have been taken into account.
The maximum deduction that can be taken from someone’s UC Standard Allowance was reduced
to 25 per cent in April 2021.</p><p> </p><p>We want to ensure that repayment of all
debt owed to the Department is sustainable and takes into account the customer’s ability
to pay. Claimants are encouraged to contact DWP if they are unable to afford the rate
of recovery. The recovery rate of Tax Credit overpayments can be reduced where a claimant
is experiencing financial hardship.</p>
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