LOCAL GOVERNMENT, ENGLAND AND WALES Citation, commencement and interpretation 1 1 This Order, which may be cited as the Housing Benefits (Subsidy) Order 1987, shall come into force on 16th November 1987. 2 In this Order, unless the context otherwise requires— “ the Act ” means the Social Security and Housing Benefits Act 1982; “scheme” means either a statutory scheme in accordance with section 28 of the Act or a local scheme in accordance with section 30 thereof; “subsidy” means rate rebate subsidy, rent rebate subsidy or rent allowance subsidy under section 32 of the Act; “ the Regulations ” means the Housing Benefits Regulations 1985 , and other expressions have the same meaning as in the Regulations. Amount of subsidy 2 The amount of an authority’s subsidy for the year beginning 1st April 1987 shall be calculated, for the purposes of section 32(2) of the Act (subsidies to authorities), by adding together the amounts in articles 3, 4 and 6 of this Order. Rebates or allowances 3 The amount of subsidy for the year in relation to an authority listed in column (1) of the Schedule to this Order shall include an amount calculated by reference to the rebates or allowances granted by that authority being— a in the case of an authority granting rebates or allowances under the statutory scheme during the year or any part of it, the percentage specified in relation to that authority in column (2) or (3) of the said Schedule, as may be appropriate, of the total of rebates or allowances so granted; or b in the case of an authority granting rebates or allowances under a local scheme within the meaning of section 30 of the Act (local schemes) during the year or any part of it, the percentage specified in relation to that authority in column (2) or (3) of the said Schedule, as may be appropriate, of the total of rebates or allowances which would have been granted under the statutory scheme, less, in either case, any deductions specified in article 5 of this Order which fall to be made from that total. Administration costs 4 An authority’s subsidy for the year shall include an amount calculated by reference to the costs of administering rebates or allowances being— a for a new town corporation, the Scottish Special Housing Association, or the Development Board for Rural Wales, 100%; and b for an authority other than one specified in paragraph (a) of this article— i in England, 60%, ii in Scotland, 65%, iii in Wales, 70%, of costs reasonably incurred by the authority during the year in administering its scheme. Deductions from subsidy in respect of rebates or allowances 5 The deductions referred to in article 3 of this Order are deductions of the following amounts: a where a tenant of an authority is or, if he were not in receipt of a rent rebate, would be able to choose whether or not to be provided with any services, facilities or rights or to choose whether or not to provide those services, facilities or rights for himself (whether or not in return for an award or grant from the appropriate authority) while continuing to occupy, or, as the case may be, when entering into occupation of, a dwelling as his home either under his existing tenancy agreement or by entering into a new agreement, the amounts attributable to those items (whether or not those amounts form part of the sum fixed as rent or are otherwise reserved as rent); b where a person is, will be, or may become, entitled to a rent-free period which does not fall to be taken into account in calculating the amount of rent rebate to which he is entitled in accordance with the Regulations, the amount of rebate which is payable to him for the period beginning with the date of the award and equal to the length of the award; c where a person in respect of whom a certificate issued under regulation 9 of the Regulations (person on supplementary benefit) is for the time being in force is charged a rent higher than that charged to any of the authority’s other tenants in respect of a similar dwelling and is so charged for a reason relating to the fact that regulation 9 of the Regulations applies to him, the amount of rebate to which he is entitled by reference to the additional amount of the rent; d any amounts awarded by an authority under regulation 25 of the Regulations (additional amount of benefit in exceptional cases); e where an authority makes an award to one of its tenants in receipt of housing benefit in the form of a payment of money or money’s worth, a credit to the person’s rent account, or in some other form, and whether or not the person is immediately entitled to the award, the amount of the award, but no such deduction shall be made in respect of an award— i made to a tenant for a reason unrelated to the fact that he is a tenant, ii made under a statutory obligation, iii for a purpose specified in or under statute made in exercise of a discretion where the circumstances in which that discretion may be exercised are also specified as aforesaid, iv made as reasonable compensation for work actually carried out by the tenant in carrying out reasonable repairs or redecoration which the authority would otherwise have carried out or be required to carry out, v of a reasonable amount made as compensation for loss, damage or inconvenience of a kind which occurs only irregularly suffered by the tenant by virtue of his occupation of his home. Overpayment of rebates or allowances 6 1 Where an authority makes an overpayment of housing benefit during the year, its subsidy for the year shall include any amount which may be payable in accordance with paragraph (2) of this article. 2 Subject to paragraph (3), subsidy under paragraph (1) of this article shall be payable in certificated cases only, and in such a case the amount of subsidy shall be the following percentage of the difference between the amount of the overpayment and the amount, if any, of the overpayment recovered by the authority— a in respect of an overpayment caused by an error of the authority making the payment, 100%; and b in respect of any other overpayment— i in the case of an authority referred to in paragraph 1 or 2 of the Schedule to this Order, 100%, and ii in the case of an authority referred to in paragraph 3 of the Schedule to this Order, 100.6%. 3 The total amount of subsidy payable to an authority for the year in respect of an overpayment to which paragraph (2)(a) of this article applies shall not exceed 0.19% of the aggregate of— a the total of rebates and allowances granted by that authority during the year in certificated cases, and b the total of any overpayments made by that authority to which paragraph (2)(b) of this article applies less any amount of those overpayments recovered by that authority. 4 In this article “overpayment” means any amount paid by way of housing benefit to which there was no entitlement under the Regulations, including any excess of housing benefit actually paid over the amount to which there was in fact entitlement under the Regulations and including any amount in excess of the amount, if any, of benefit which would have been due had a certificate under regulation 9 of the Regulations not been issued or, as the case may be, had such a certificate been cancelled. Signed by authority of the Secretary of State for Social Services. Michael Partillo Parliamentary Under-Secretary of State Department of Health and Social Security 6th October 1987 We consent, T. Durant D. Lightbown Two of the Lords Commissioners of Her Majesty’s Treasury 16th October 1987