Debt recovery suspension

When a client is cancelling their benefit (ie they have taken reasonable steps to ensure it has been cancelled) to start or to continue in paid employment, and has an outstanding debt, the client can request their debt recovery be suspended for 3 months.

When a client incurs new debt during the suspension period, the recovery should also be suspended until the suspension period ends.

We can still accept repayments if the client wishes to start paying the outstanding debt straight away.

Debt recovery suspension is processed through the SBFTZ screen in SWIFTT.

The SDPAA screen will automatically update by entering 'Y' in the Debt Recovery Suspension field in the SBFTZ screen.

A client does not have to access any other components of assistance to transition into employment such as bridging finance to be eligible for debt recovery suspension.

Note debt recovery suspension is not available for temporary employment and students moving into holiday employment.

A client does not need to be cancelling a main benefit to be eligible for debt recovery suspension. If a non-beneficiary is moving into or between permanent, full-time employment and has an outstanding Work and Income debt or Student Allowance debt, they may be eligible for the 3 month debt recovery suspension period.

However, we can still accept repayments if the client wishes to start paying the outstanding debt straight away.

Debt recovery suspension for non-beneficiaries is processed through the SSNAR screen in SWIFTT or by notifying the Debt Unit if the client is not accessing any other components of assistance to transition into employment.

Assistance to transition into employment application form must be completed if a client wants their debt recovery suspended for 3 months. The client does not need to be accessing other components of the assistance to transition into employment to apply for debt recovery suspension.

When a client applies for debt recovery suspension without accessing other components of assistance to transition into employment, you must complete CMS notes with full employer details and the reason why the client qualifies for the debt recovery suspension.

If the client wishes to make voluntary debt repayments the following screens need to be completed:

• enter 'Y' in the paying arrangement field in SBZC if transferring to Working for Families Assistance or
• enter 'Y' in the paying arrangement field in SBFTZ
• add arrangement type, value of regular payments and frequency of payment in the SDPAA screen

Note the first payment date must always remain as the date that was pre-filled by SWIFTT.