[2025] UKUT 249 (AAC)

It is a principle both of statutory construction and constitutional fairness that recovery of overpayments cannot occur without due process. Section 71(5A) of the 1992 Act imposes two mandatory preconditions before recovery of overpayment: first, there must have been a revised or superseded entitlement decision; second, the claimant must have been notified of that decision.

Two separate rights of appeal follow: first a right of appeal arises against the revised entitlement decision which crystallises on notification of a substantive decision under section 12(1) and (2) of the 1998 Act. Second, a further and separate right of appeal arises against the decision(s) to recover overpayments under section 71 of the 1992 Act (see section 12(4) of the 1998 Act).

The Supreme Court in CPAG v Secretary of State for Work and Pensions [2010] UKSC 54 is authoritative as to the rigorous requirements to which the Secretary of State is held. Lord Wilson observed that until a benefit award is formally corrected, it remains payable, regardless of any internal departmental view to the contrary. Recovery is not permissible until the award is lawfully varied or reversed.

These principles were reaffirmed in LL v Secretary of State for Work and Pensions [2013] UKUT 208 (AAC), where Judge Fordham KC (as he then was) confirmed that notification of revised entitlement is essential if a revised decision is to be legally effective. Decision-making without effective notice is of no legal effect and attempts at recovery of overpayment in its absence is unlawful.