9.3 Recovery of overpayments

September 2023

Legislative authority

Sections 19-23, 28(6) and 32 of the Ontario Works Act.
Section 62 of the Ontario Works General Regulation
Section 10 of the Ontario Works General Regulation

Audit requirements

Documentation is on file to support decisions made.

Overpayments are documented properly to support both the decision and the calculation, and are being recovered.

A copy of the Notice of Decision is kept on file.

Systems are updated and maintained.

Accounting principles are adhered to.

Delivery agent employees and contracted agencies adhere to all legislation, regulations and directives governing the methods and processes for the collection of debts.

A signed Rights and Responsibilities form is on file. For clarity, a signature may be provided electronically via approved methods or as a “wet signature” (i.e., pen to paper).

Random file reviews are completed to ensure that all requirements are met.

Application of policy

Delivery agents must ensure that a recipient receives only the amount of assistance for which they are eligible to receive, based on all available information.

Delivery agents must ensure that a recipient is aware of their reporting requirements. If notification regarding a new or changed circumstance is provided by a recipient or identified through a file review, this information must be actioned in a timely manner to prevent the creation of, or reduce the amount of, a new overpayment.

If an amount has been provided to the recipient that exceeds the amount they were eligible to receive, the excess is an overpayment. In addition, if a recipient, spouse or dependent fails to honour an Assignment or Agreement to Reimburse, the amount is an overpayment.

All overpayments are subject to recovery. Only under exceptional circumstances is an overpayment considered uncollectible.

The overpayment must be calculated accurately, and the reason(s) for the overpayment and the period of time to which it applies must be fully documented. Overpayment collection should only take place if there is documentation to substantiate the overpayment.

For active cases, notice must be given to the recipient (and spouse, if applicable) in writing of the amount of the overpayment, the period for which it applies, the reason for which it was incurred and their rights to appeal (see Directive 9.5: Sharing of overpayments between spouses for more information).

Overpayments on active cases should be recovered by reducing monthly financial assistance.  

Where arrears of basic financial assistance are owed to the recipient, the Administrator may apply up to 100% of the arrears toward an existing overpayment. Staff should exercise discretion before applying arrears towards an existing overpayment and consider a recipient’s individual circumstances (for more information, please see the Applying Arrears to an Overpayment section).

Establishing an overpayment

An overpayment should be established where a recipient receives an amount in excess of the amount to which the recipient was eligible to receive. Reasons for establishing an overpayments includes, but is not limited to, delays in reporting changes in circumstances, non-disclosure of information, misrepresentation of facts, administrative error, and excess income and assets that are not exempt under Ontario Works (see Directive 9.4: Overpayments due to excess assets for more information).

An overpayment should only be established if there is documentation to substantiate it. If upon review of an existing overpayment, delivery agents cannot find sufficient documentation/evidence to validate the overpayment, it should not be established or recovered and should be recommended for write off (for more information, please see the Administrative write off process section).

Where a recipient does not use their financial assistance payment for the intended purpose (e.g., to pay for their shelter costs) an overpayment should not be established.  Rather, pay direct or trusteeship may be options to consider to ensure the recipient retains their lodging (see Directive 3.6 – Trusteeship and Directive 3.7 – Pay Direct for more information). 

Overpayment for Non-Compliant Recipients

Where basic financial assistance is reduced or cancelled because of non-compliance (e.g., not showing up for an eligibility review meeting, not providing necessary information to determine eligibility, etc.) and it is determined that the recipient received assistance that they were not eligible to receive, an overpayment should be established. The overpayment should apply to the period of time for which there is documentation to substantiate that the recipient received assistance that exceeded the amount for which they were eligible to receive (see Directive 6.13: Calculating reduced assistance and Directive 9.1: Reviewing eligibility for more information).

Overpayment on benefits

A payment for a benefit provided to a recipient, spouse or dependent in a month where they were deemed ineligible should be established as an overpayment and may be recovered, with the following exceptions:

• where the amount of the benefit cannot be quantified
• where a recipient was found to be ineligible for social assistance for a month due to high earnings, but was eligible the following month

Recovery of overpayments

Delivery agents should attempt to collect 100% of an overpayment where there is evidence to substantiate the overpayment.

In exceptional circumstances and/or where a recipient requests an internal review of an overpayment decision, an overpayment may be reduced or not recovered where the situation warrants reduction or non-recovery.  In exercising this discretion, staff should consider the individual circumstances of the case - including but not limited to the role of the recipient in the creation of the overpayment (including whether there is a history of overpayments on file as a result of not reporting changes in circumstances), the role of staff in creating the overpayment and hardship. There may also be circumstances that may warrant suspending recovery (please see the Temporarily uncollectible overpayments section) or deem part or all of an overpayment permanently uncollectible (e.g., the balance of an overpayment remaining after a bankruptcy settlement). 

Overpayment recovery should be activated when an overpayment balance is over $2.50. Where the balance is $2.50 or less, the overpayment should be deemed temporarily uncollectible, and may be recommended for write off during the annual write off process (for more information, please see the Temporarily Uncollectible Overpayments section and the Administrative Write Off Process section).

Where ongoing recovery has reduced the overpayment to $2.50 or less, recovery should continue until the overpayment is reduced to $0.

Overpayments on active cases

Overpayments on active cases, including cases previously terminated and re-granted, are recovered by reducing monthly financial assistance. The default recovery rate in the system is set at 5% of budgetary requirements. However, the prescribed rate of recovery is 10% of budgetary requirements.

Recovery of overpayments may be increased up to the prescribed rate of 10% where there is evidence of the recipient’s capacity to pay. Additionally, an Administrator should increase recovery to the prescribed rate of 10% when a new overpayment is established through the following circumstances:

• Eligibility Verification Process (EVP) review
• Complaint Assessment (preliminary or secondary review)
• the new overpayment is covering three or more benefits months
• new overpayment created is $1000 or more
• the recipient has multiple overpayments on file that were a result of separate changes and were collectively not a result of an administrative error or do not have valid exceptional circumstances for late reporting

Administrators may use their discretion to not recover an overpayment at the prescribed rate of 10% as described above and may set a lower recovery rate when the following circumstances are present:

• individual was not informed of their reporting requirements
• the reason for the overpayment was an administrative error
• factors reasonably beyond an individual’s control that prevented reporting in a timely and/or accurate manner (e.g., hospitalization, fleeing abuse and/or exploitation)

In situations where the recipient provides evidence that demonstrates, to the satisfaction of the Administrator, that the application of the prescribed rate of overpayment recovery will result in undue hardship, the Administrator may use their discretion to set a lower recovery rate.

Applying Arrears to an Overpayment

Where arrears of basic financial assistance are owed to a recipient, the Administrator may apply 100% of such arrears to an existing overpayment.  The recipient (and spouse, if applicable) must be advised in writing that arrears owed are being applied to an existing overpayment.

The Administrator should review the amount of the arrears that will be applied to an existing overpayment with the recipient. Where arrears may be owing to a recipient (and spouse, if applicable) that has an existing overpayment, the Administrator should exercise discretion in applying this policy so that it does not create undue hardship for the recipient. In situations where arrears are incurred as a result of circumstances outside the control of the recipient, full arrears should be paid to a recipient rather than applying them to the overpayment.  For example, arrears should be paid to a recipient if their rent is increased retroactively following a Landlord and Tenant Board hearing.

Personal Needs Allowance and Special Boarder Allowance

If the recipient receives a personal needs allowance (PNA), and this amount is the recipient's only source of income, then the Administrator may consider the overpayment amount as temporarily uncollectible (for more information, please see the Temporarily Uncollectible Overpayments section).

If the recipient receives a PNA and the recipient has chargeable income against their basic financial assistance, overpayment recovery may take place as long as the recipient's monthly income from all sources does not fall below the amount of the PNA. Where recovery would result in the recipient’s monthly income falling below the amount of the PNA, then the Administrator may consider the overpayment amount as temporarily uncollectable (for more information, please see the  Temporarily Uncollectible Overpayments section).

In cases where the Special Boarder Allowance (SBA) is a component of the income support and an overpayment exists, overpayment recovery may continue as long as the recipient's monthly income from all sources does not fall below the SBA amount.

Support Deduction Notice and Overpayment Recovery

If a Support Deduction Notice (SDN) issued by the Family Responsibility Office (FRO) is received for a recipient and an overpayment is being recovered, the SDN has priority over the overpayment recovery. The combined total amount that may be deducted to recover an overpayment and to honour a SDN cannot exceed 10% of budgetary requirements unless the recipient agrees in writing to the remittance of a greater amount (see Directive 6.15: Protection from seizure or garnishment for more information). This means that the rate of recovery may need to be reduced or overpayment recovery may need to be suspended while the SDN is in effect (for more information, please see the Temporarily uncollectible overpayments section).

Overpayments on inactive cases

All overpayments for persons no longer receiving assistance are subject to recovery.

When a case is terminated with an outstanding overpayment, the delivery agent should review the file to ensure that the amount of the overpayment is correct and make a recommendation regarding the status and collection of the overpayment. Attempts to recover the overpayment debt from the former recipient through voluntary repayment arrangements should be made. The delivery agent will respond to former recipient and/or advocate inquiries regarding the overpayment according to established protocols.

The delivery agent should ensure a variety of payment methods are available to former recipients, including payment via cheques, post-dated cheques, money orders, credit cards, electronic transfer of funds and cash.

The delivery agentmay choose to engage a third party (e.g., a private collection agency) to perform debt collection activities in accordance with delivery agent procedures based on relevant provincial guidelines.

Reporting personal information to the Credit Bureau about a former recipient with an overpayment is not part of the overpayment recovery process and the overpayment does not include interest on the overdue amount.

The Canada Revenue Agency (CRA) Refund Set Off (RSO) Program

Note: This section applies only to those delivery agents whose overpayment debts have been formally deemed by the Director of Ontario Works to be debt due to the Crown. As of May 2013, only one municipality, the City of Toronto, is eligible to participate in the CRA Refund Set Off Program.

Ontario Works overpayments are debt due to the delivery agent and may also be formally deemed by the Director of Ontario Works to be debt due to the Crown. In such cases where the overpayment has been formally deemed by the Director of Ontario Works to be debt due to the Crown, the delivery agent may transfer validated overpayments on inactive cases (for which local recovery efforts have not resulted in recovery) to the ministry’s Financial Services Unit (FSU) for referral to the CRA RSO Program for collection.

Overpayments that have not been formally deemed by the Director to be debts due to the Crown are not eligible for the CRA RSO Program.

The CRA RSO Program intercepts personal income tax refunds on behalf of the province and applies them against outstanding debts that the province has been unable to collect.

Note: The following overpayments are ineligible for referral to the CRA RSO Program and may be recommended for write off where the case is inactive (for more information, please see the Administrative Write Off Process section):

• overpayments incurred under the General Welfare Assistance (GWA) Act
  • as these overpayments are not debt due to the Crown, they should not be referred to the CRA RSO Program under any circumstances (including overpayments incurred under the GWA Act by persons who were subsequently granted Ontario Works or ODSP), and may be recommended for write off after local collection efforts have been made
• any overpayment under the Family Benefits Act (FBA) where the person has never been in receipt of Ontario Works or ODSP and did not have the right to appeal the overpayment decision
  • these overpayment are only collectible if the person returns to social assistance and receives notice of the right to appeal

Returning recipients

When a former social assistance recipient returns to Ontario Works, the delivery agent should review the file to determine whether there are any outstanding overpayments that are subject to recovery, including past Social Benefits Tribunal (SBT) decisions and previously written off overpayments (for more information, please see the Administrative write off process section).

The delivery agent must advise the recipient (and spouse, if applicable) in writing that the outstanding overpayment is being recovered.

If a case with an outstanding overpayment is being granted assistance retroactively, recovery of the overpayment must be applied to the retroactive payment.

Temporarily uncollectible overpayments

Under certain circumstances, overpayment recovery may be suspended and the overpayment deemed temporarily uncollectible for a period of time. Examples of valid reasons for suspending overpayment recovery include situations where:

• the overpayment balance on an active case is $2.50 or less and the overpayment has not yet been recommended for write off (for more information, please see the Recovery of overpayments section)
• recovery of the overpayment would result in undue hardship (for more information, please see the Overpayments on active cases section)
• the recipient’s only income is the personal needs allowance, or where recovery would result in the recipient’s monthly income from all sources to fall below the amount of the personal needs allowance (for more information, please see the Overpayments on active cases section)
• financial assistance is being deducted and applied to a Support Deduction Notice (SDN) and the amount deducted for the SDN exceeds 10% of the recipient’s budgetary requirements (for more information, please see the Overpayments on active cases section)
• the overpayment is on an inactive Temporary Care Assistance (TCA) case and the adult caregiver is a member of an active social assistance benefit unit (for more information, please see the Temporary Care Assistance overpayments section)
• the overpayment is on an inactive “dependent of dependent” case and the dependent parent is a member of an active social assistance benefit unit (for more information, please see the “Dependent of dependent” overpayments section)
• the overpayment is pending the outcome of bankruptcy proceedings, unless the court has granted permission for recovery to continue (for more information, please see the Bankruptcy section)
• the case is under criminal investigation/court proceedings for fraud and protocol with local authority requires that overpayment recovery be suspended until the outcome of the investigation/court proceedings is known (for more information, please see the Cases of alleged fraud section)
• the overpayment is pending the outcome of a Consumer Proposal (for more information, please see the Negotiated settlements to defer collection activity on inactive cases section)
• the overpayment is under internal review
• the overpayment is under appeal and the Social Benefits Tribunal (SBT) has ordered Interim Assistance to be paid to the recipient
• caseworkers should set a reasonable review date (e.g., one month, three months, etc.) for these overpayments on a case by case basis according to the circumstances. At the review, a decision should be made on the appropriate status for the overpayment (e.g., begin collection, maintain as temporarily uncollectible, recommend for write off per the write off criteria in this directive, etc.), and should provide written notice of the decision to the recipient (and spouse, if applicable).
• Temporary Care Assistance

Temporary Care Assistance overpayments

An overpayment on an active Temporary Care Assistance (TCA) case may only be recovered from the TCA benefit unit.

If a TCA benefit unit terminates from assistance, any outstanding overpayments may be recovered from the adult caregiver (i.e., the recipient) according to regular recovery procedures for inactive Ontario Works cases. If the adult caregiver is a member of an active Ontario Works or ODSP benefit unit, the Administrator should suspend recovery until the caregiver terminates from social assistance (for more information, please see the Temporarily uncollectible overpayments section). Financial assistance for the adult caregiver’s benefit unit cannot be deducted to repay the TCA overpayment.

"Dependent of dependent" overpayments

An overpayment may be established where a dependent parent received an amount for his/her dependent child which their was not eligible to receive (see Directive 6.1: Calculating assistance for more information). The overpayment may only be recovered from the dependent of dependent’s benefit unit.

If the dependent of dependent case terminates from assistance, any outstanding overpayments belonging to the benefit unit may be recovered from the dependent parent (i.e., the recipient) according to regular recovery procedures for inactive Ontario Works cases. If the dependent parent is a member of an active Ontario Works or ODSP benefit unit, the Administrator should suspend recovery until the dependent parent terminates from social assistance (for more information, please see the Temporarily uncollectible overpayments section). Financial assistance for the benefit unit to which the dependent parent belongs cannot be deducted to repay the overpayment on the dependent of dependent case.

Bankruptcy

If a recipient or former recipient with an outstanding overpayment files for bankruptcy, no action can be taken against that person (the debtor) or their property until the person has been discharged from the bankruptcy. In such cases, overpayment recovery should be suspended and the overpayment should be deemed temporarily uncollectible once the delivery agent is notified of the filing of bankruptcy unless the court has granted permission to the delivery agent to continue recovery during the bankruptcy proceedings (for more information, please see the Temporarily uncollectible overpayments section).

The dividend paid, if any, after the notice of discharge is received should be accepted as full settlement of the overpayment and the balance of the overpayment should be recommended for write off.

Surviving bankruptcy

An overpayment survives bankruptcy and remains recoverable only where there is a criminal or civil court decision that the overpayment was incurred by fraud (i.e., a fraud conviction).

Cases of alleged fraud

Eligibility investigations on active or inactive cases, which result in an overpayment, may or may not be pursued for fraud.

Where an overpayment has been established and the case will not be referred to police for fraud investigation, the recipient/former recipient should be advised of the reason for the overpayment amount, and appropriate collection efforts should begin.

Where a case has been referred for police investigation/court proceedings for fraud, the collection of the overpayment can proceed in accordance with regular recovery procedures. However, if there is an agreement with local authorities for overpayment collection to be suspended until the outcome of the investigation/court proceedings is known, overpayment recovery should be suspended (for more information, please see the Temporarily uncollectible overpayments section).

Acquittals

If a recipient/former recipient is acquitted without a finding by the court on the merits of the case, the overpayment should be considered collectible and recovered in accordance with regular recovery procedures.

In cases where the recipient/former recipient is acquitted and the finding of the court is that fraud has not been proven, there must be a careful review of the circumstances. An overpayment may still be recovered notwithstanding the acquittal on a fraud charge if the recipient/former recipient received assistance in excess of which they were eligible to receive.

Criminal convictions

In cases where a recipient/former recipient is convicted of fraud, if the overpayment amount originally calculated is more than the amount confirmed by the findings of fact by the court, the difference should be recommended for write off.

If negotiations have occurred between the accused (either personally or through his/her defence counsel) and the Crown Attorney, they must be taken into account to determine whether or not, and how much overpayment should be recovered. If the Crown Attorney agreed not to pursue recovery in exchange for a guilty plea, or at the time of sentencing indicated no recovery would be pursued, it would not be appropriate to proceed with an overpayment recovery. In this case, the balance of the overpayment should be recommended for write off (for more information, please see the Administrative write off process section).

Restitution orders

In cases where a recipient/former recipient is convicted of fraud and the Court has ordered restitution for all or part of the overpayment in question, the delivery agent specified in the restitution order is responsible for monitoring compliance with the terms of the restitution order.

If a recipient is not making payments per the terms of the restitution order, the delivery agent may deduct a portion of the recipient’s financial assistance to recover the overpayment amount subject to the restitution order as provided under section 20 of the Ontario Works Act, 1997.

An overpayment amount subject to a restitution order is not portable between delivery agents and programs, and should not be recommended for write off while the restitution order is enforceable.

In cases where there is a fraud conviction and no restitution is ordered, or where the restitution order covers only a portion of the overpayment, the overpayment amount that is not subject to a restitution order is considered to be collectible (unless the Crown Attorney has agreed not to pursue that amount). Delivery agents should make a determination as to the appropriate method for dealing with these overpayments, in accordance with regular recovery procedures.

Administrative errors

Overpayments may, at times, result from administrative errors such as miscalculations, a delay or failure to act on information.

When a recipient provides information that would reduce the amount of financial assistance, every effort must be made to promptly act to reduce the amount of financial assistance in order to prevent an overpayment. If the information is not processed and the recipient receives an amount they know to be incorrect, the onus is on the recipient to notify Ontario Works staff of this error. These overpayments are recoverable. The overpayment should be properly documented on the file and action taken to avoid recurrence of the problem.

In extenuating circumstances, an overpayment resulting from an administrative error may be recommended for write off (see below for more information on the write off process). For example, if change(s) to a recipient’s financial assistance are not made even after notification of an error in distribution of assistance and the recipient has done everything possible to notify Ontario Works staff (i.e., there is documented evidence that the recipient had advised staff of the error), an overpayment may not be recovered.

Negotiated settlements to defer collection activity on inactive cases

If all reasonable efforts have been made to collect an overpayment in full, and the former recipient indicates a willingness to enter into a repayment plan for the total or partial repayment of the outstanding overpayment, the delivery agent may negotiate a reasonable settlement, subject to local approval.

As part of any repayment plan, the Administrator should include a specific term whereby the individual consents to the plan being reviewed in the future and consents to the overpayment being collectible should, in the opinion of the Administrator, the individual’s financial circumstances improve. Letters outlining the proposed settlement, and details and acceptance of the terms are to be kept on file.

Where an individual submits a Consumer Proposal to the delivery agent, recovery should be suspended until a decision is made by the delivery agenton the Consumer Proposal (for more information, please see the Temporarily uncollectible overpayments section).

In accordance with the terms of the settlement, the balance of the overpayment may be recommended for write off (see below for more information on the write off process).

The Administrative write off process

Following reasonable collection efforts, an overpayment may be considered uncollectible and may be recommended for write off by the Administrator.

The recommended write off of an overpayment is subject to local delivery agent approval and should be completed each fiscal year. The process of writing off overpayment debts is administrative only and does not mean that the debt is forgiven, and a recipient should not be advised that the overpayment has been forgiven or that an administrative write off has taken place.

There are two categories of overpayments that may be recommended for write off:

1. Uncollectible overpayments
2. Overpayments where collection efforts have not resulted in recovery (inactive cases only)

1. Uncollectible overpayments

Overpayments that are uncollectible may be recommended for write off annually where:

1. the former recipient has been deported
2. there is insufficient documentation to substantiate the overpayment (for more information, please see the Establishing an Overpayment section)
3. the overpayment balance is $2.50 or less (for more information, please see the Recovery of overpayments section)
4. the former recipient is deceased and there is no estate, and where applicable (i.e. where the overpayment section applies only to those delivery agents whose overpayment debts have been formally deemed by the Director of Ontario Works to be debt due to the Crown), the overpayment debt has been with the Canada Revenue Agency Refund Set Off (CRA RSO) Program for two full taxation years (for more information, please see The Canada Revenue Agency Refund Set Off Program section)
5. the overpayment on an inactive case is not eligible for the CRA RSO Program, and local collection efforts have not produced results (i.e., overpayments incurred under the General Welfare Act, and overpayments incurred under the Family Benefits Act where the person has never been in receipt of Ontario Works or ODSP and has not received notice of the right to appeal; for more information, please see The Canada Revenue Agency Refund Set Off Program section)
6. the recipient/former recipient has had their overpayment debt discharged in a bankruptcy proceeding
   • the dividend paid, if any, after the notice of discharge is received should be accepted as full settlement of the overpayment and the balance of the overpayment should be recommended for write off (except where there is a criminal or court decision that the overpayment was a result of fraud or misrepresentation; for more information, please see the Bankruptcy section)
7. there has been a court decision of fraud or misrepresentation
   • if the overpayment amount originally calculated is greater than the amount confirmed by the findings of the court, the difference, or the amount the Crown Attorney agreed not to pursue, should be recommended for write off (for more information, please see the Criminal convictions section)
8. the overpayment was established due to an administrative error, and there is an extenuating circumstance (i.e., there is evidence that the recipient had advised staff of the error, for more information, please see the Administrative errors section)
9. the delivery agent has negotiated a reasonable settlement
   • the balance of the overpayment should be recommended for write off (for more information, please see the Negotiated settlements to defer collection activity on inactive cases section)
10. the Social Benefits Tribunal (SBT) made a final decision, ordering that an overpayment not be recovered (for more information, please see the Jurisdiction of the Social Benefits Tribunal section)

2. Overpayments where collection efforts have not resulted in recovery (inactive cases only)

Overpayments on inactive cases may be recommended for write off based on their age (date of termination of the case or last voluntary payment) and the amount outstanding, after collection efforts outlined below have been made.

• Overpayments that are less than $20 and at least 120 days old may be recommended for write off once all collection efforts have been made, including the issuance of the Outstanding Overpayment Balance Letter on the date the overpayment was established
• Overpayments that are between $20 and $499 and at least 3 years old may be recommended for write off once the Ontario Works Administrator has taken the following collection activities:
  • Outstanding Overpayment Balance Letter has been issued twice - on the date the overpayment was established and again after 30 days
  • where applicable, the overpayment has been submitted to the CRA RSO Program for collection but has not resulted in material recovery for at least two full annual taxation cycles
• Overpayments that are over $500 and at least five years old may be recommended for write off once the Ontario Works Administrator has made reasonable collection efforts, including:
  • timely invoicing and statements issuance (e.g., minimum two letters in each of the five years)
  • direct verbal contact has been attempted (e.g., minimum three calls in each of the five years)
  • delinquency notices have been issued (e.g., minimum two letters explaining possible referral to collection agency and/or possible legal action in each of the five years)
  • where appropriate (i.e., in accordance with delivery agent debt collection policies and procedures), specialized collection activities (e.g., Private Collection Agency) and legal action (e.g., Small Claims Court) have been taken

Table: Treatment of overpayments where collection efforts have not resulted in recovery (inactive cases)

Note: for overpayments eligible for CRA RSO Program see below

• Overpayments that are eligible for the CRA RSO Program (for more information, please see the CRA RSO Program section) may be recommended for write off in accordance with the above table with the following exceptions:
• Debts between $500 and $25,000 and more than 5 years old must have been submitted to the CRA RSO Program for collection without successful recovery for at least two full annual taxation cycles
• Debts greater than $25,000 must be resubmitted to the CRA RSO Program after five years before being recommended for write off

Reactivation of recovery of previously written off overpayments

In cases where an overpayment was previously written off and the Administrator determines that opportunities to recover amounts owed have improved, then the Administrator should initiate efforts to collect the written off overpayment except in the following cases:

• there is insufficient documentation to substantiate the overpayment (for more information, please see the Establishing an overpayment section)
• the overpayment was written off because the balance was $2.50 or less (for more information, please see the Recovery of overpayments section)
• the former recipient is deceased and there is no estate
• the overpayment was discharged in a bankruptcy proceeding (for more information, please see the Bankruptcy section)
• the overpayment amount was written off as a result of court proceedings (i.e., based on findings of fact by the court or negotiations by the Crown Attorney; for more information, please see the Criminal convictions section)
• the overpayment was incurred due to an administrative error and was written off due to an extenuating circumstance (for more information, please see the Administrative errors section)
• the SBT made a final decision, ordering that the overpayment on an inactive case not be recovered (see below for more information)

Rights of appeal

Decisions regarding the correctness of an overpayment assessment and the rate of recovery of an overpayment can be appealed to the Social Benefits Tribunal (SBT). Appropriate information on the right to request an internal review and the right to appeal must be provided to the recipient (and spouse, if applicable) in writing.

Jurisdiction of the Social Benefits Tribunal

The SBT has jurisdiction with respect to a decision of the Administrator affecting eligibility for, or the amount of, financial assistance. The SBT has the same authority as the Administrator with respect to the recovery of overpayments, and as such may order that a recipient’s financial assistance should not be reduced to recover an overpayment.

A decision by the SBT that an overpayment should be permanently uncollectible means that overpayment recovery should cease if the individual is currently receiving social assistance, and that their overpayment remains uncollectible if the individual leaves social assistance. Overpayments that are ordered permanently uncollectible by the SBT should be recommended for write-off (for more information, please see the Administrative write off process section).

Transferring overpayments

Overpayments are portable, which means that an overpayment incurred under Ontario Works, ODSP, the General Welfare Assistance (GWA) Act or the Family Benefits Act (FBA) remains collectible if the recipient or dependent spouse moves between programs or delivery agents (see Directive 9.6: Overpayment transfer and Directive 9.5: Sharing of overpayments between spouses for more information).

Where an overpayment is under appeal and the recipient has moved to another delivery agent or program, the overpayment under appeal should not be transferred and activated for recovery until the appeal is resolved. If an overpayment incurred at another office is already transferred to another office and the recipient subsequently appeals, the receiving office is responsible for this appeal. It may be necessary to work with the office where the overpayment was originally established.

Monitoring and accountability

Delivery agents are accountable for all debts and are responsible for retaining documentation for substantiating the debt. Internal delivery agent procedures for the collection of overpayments must comply with any and all applicable ministry policies and practices. Records and archives may be requested by the ministry for review.

Other impacting legislation

Limitations Act

The Limitations Act, 2004, allows for any debts owed to a municipality related to the provision of social assistance, health and economic programs not to be subject to a limitation period; therefore the municipal delivery agent never loses the ability to pursue a claim for payment as a result of time elapsing.

Collection Agencies Act

Any agreements negotiated with a private collection agency must comply with the provisions of the Collection Agencies Act and with municipal procurement policies and any other applicable municipal policies and practices.