Refunding overcharged council tenants could cost Cambridge City Council £4.3m - but some of their details have been wiped

Repayments to council tenants who were overcharged for rent and service payments could cost Cambridge City Council more than £4.3million, with some residents owed thousands.

Some of the errors date back more than 20 years and the council is having to hire an extra member of staff on a project team to handle the “significant workload” of reviewing more than 23,000 tenancies to work out who is impacted.

However, as the details of former tenants have to be wiped from the system after six years due to GDPR (General Data Protection Regulation) rules, the council does not know the identity of some of those affected.

The authority announced in March that it had identified two historic errors in how it set its rent and service charges.

One error related to the authority not correctly applying a one per cent rent reduction under the Welfare Reform and Work Act 2016 to its affordable rented homes.

The second error related to how rent and service charges were displayed on rent accounts since the introduction of rent restructuring from April 2002 and the subsequent separating out of service charges from April 2004.

Officers told a housing scrutiny committee meeting last week that all current council tenants who had been impacted have now been contacted and all the rents had now been corrected.

This means the council has “closed the window” on the errors and could move on to work on refunding the overpayments.

However, officers explained there are some complications, including agreeing with the Department for Work and Pensions on how any overpayment of Universal Credit should be refunded.

In cases where former tenants’ details are wiped from the system, officers will still be able to calculate how much was overpaid based on the property they were living in but will not have the ability to contact them.

The council expects that it will have to ask anybody who was a tenant in the past who thinks may have been impacted by the rent error to get in touch and provide evidence they lived in a property so that their right to a refund could be assessed. Officers said this would have to be considered on a case-by-case basis.

The city council hopes to begin making the first refunds later this year.