Examinations: Post-award penalty cases: Adjustment needed to the award
If after considering the customers reply, you have now resolved your concerns, you can make a decision based on your conclusions. This might mean you terminate the whole of your award or you might only need to adjust part of the award. For example the risks were an Undisclosed Partner and Child Care Costs high compared to income. The customer has convinced you they do not have a partner but they have overstated their child care costs. You will, therefore, adjust the amount claimed for child care costs.
You must consult your Band O manager and your manager will decide whether we will charge a penalty.
The Band O manager will need to consider the type of error and the customer’s behaviour which led to the incorrect claim - see CCM10710. In deciding the behaviour category of the penalty the Band O manager will take into account any explanation the customer has given regarding the error. If there is not enough information to decide on the behaviour category or your manager is not certain there is at least neglect, either your manager or another Band O will need to contact the customer to discuss why they made the error in their claim.
If your manager decides there is no fraud or neglect there will be no penalty. You (the Compliance Officer) must close the case as shown at CCM4430.
If your manager decides to charge a penalty the papers should be referred to a Band O caseworker to continue to work the case.
Action by Band O caseworker
Before taking any action to adjust the award you must consider whether any adjustments are needed to an earlier award. For example the examination has established that child care costs are incorrect and were also overstated in the previous year. If an earlier year also needs to be adjusted - see CCM8115. After issuing the letter in CCM8116, BF your papers for 7 days and then continue as shown below.
You will then calculate the penalty. CCM chapter 10 gives detailed guidance on how to calculate the penalty. Once you have calculated the amount you should show the amount of the penalty on form 94NTC
You must write to the customer(s) to let them know about your decision. You should always write to them even if you have spoken to them and explained the position on the phone.
You must use the standard letter template TCC61. The letter explains that you will be amending their award for that year and they will soon receive a formal notification of their revised award. It also explains we will be charging a penalty.
If the customer has authorised an agent to act for them remember to send a copy of the letter to the agent.
You should take the necessary system action to adjust the award as soon as possible after you send the letter. The system will send out a new award notice. This decision is made under S16. The customer then has 30 days to appeal against your decision.
If an adjustment is needed for an earlier year you will also need to send a letter closing that year. You will then need to amend the award for that year before you make any adjustment for the examination year.
If the customer appeals, see CCM4860.