Decision : Not upheld
Decision date : 02 Oct 2018
The Ombudsman's final decision:
Summary: There is no evidence the Council was at fault in the way it considered Mrs X could fund her own care through the capital left from the sale of her home.
- The complainant (whom I shall call Mr P) complains about the way the Council decided that his elderly mother (Mrs X) had deprived herself of some assets with the intention of avoiding care home charges.
The Ombudsman’s role and powers
- We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word ‘fault’ to refer to these.
- We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
- If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)
How I considered this complaint
- I considered the written information provided by Mr P and by the Council: I spoke to Mr P. Both parties had an opportunity to comment on an earlier draft of this statement before I reached a final decision.
What I found
- If the council is involved in arranging a residential care placement, it will charge the person the cost of care it arranges. If the person says he or she cannot afford to pay the cost, the Council must undertake a financial assessment to establish whether the service user will have to pay towards their care. Currently the upper capital limit (above which people are regarded as self-funding) is £23,250, and a tariff income is assumed for residents with capital between £14,250 and £23,250.
- The council may consider a resident has deliberately deprived themselves of an asset in order to reduce the charges they are asked to pay. The council should consider whether deprivation has occurred, what its purpose was, and the timing of that deprivation. Having considered the facts the council may decide to treat the resident as still owning that asset.
- The Care and Support Statutory Guidance says, “It is up to the person to prove to the local authority that they no longer have the asset. If they are not able to, the local authority must assess them as if they still had the asset. For capital assets, acceptable evidence of their disposal would be:
(a) a trust deed
(b) deed of gift
(c) receipts for expenditure
(d) proof that debts have been repaid.
A person can deprive themselves of capital in many ways, but common approaches may be:
- a lump-sum payment to someone else, for example as a gift……”
- The Guidance goes on, “There may be many reasons for a person depriving themselves of an asset. A local authority should therefore consider the following before deciding whether deprivation for the purpose of avoiding care and support charges has occurred:
(a) whether avoiding the care and support charge was a significant motivation in the timing of the disposal of the asset; at the point the capital was disposed of could the person have a reasonable expectation of the need for care and support?
(b) did the person have a reasonable expectation of needing to contribute to the cost of their eligible care needs?
For example, it would be unreasonable to decide that a person had disposed of an asset in order to reduce the level of charges for their care and support needs if at the time the disposal took place they were fit and healthy and could not have foreseen the need for care and support.”
- Attendance Allowance helps with extra costs for people with a disability severe enough that they need someone to help look after them. It is paid at two different rates which depend on the level of care needed because of the disability.
- Mrs X, who is now 97, has received some care services from the Council from 2006 onwards, including (in 2006) equipment to help her at home, and from 2012 attendance at a day centre. The Council’s records show that it conducted a financial assessment in 2012 and Mrs X was assessed as needing to pay a client contribution towards the cost of her care and the day centre. Mrs X also started receiving Attendance Allowance in 2008. She applied for a Blue Badge in December 2014 and said on the application that she now was “much weaker” and needed more support with walking aids.
- Mrs X sold her home and moved into sheltered accommodation in January 2015. From the sale proceeds she gifted Mr P the sum of £54,630. Mr P says the gift was made “officially” through solicitors.
- In October 2015 Mrs X went to a residential care home for a two-week respite period. Mr P applied to the Council for help with funding towards the cost of the care. On the financial assessment form, he noted that £83,000 of the £130,000 sale proceeds from Mrs X’s house was paid back for equity release, and that she had gifted some money to Mr P for buying a property. The Council asked for more details of the gift.
- The Council wrote to Mr P in November 2015 and said that it considered Mrs X was able to fund her own care. It said the money she had gifted to Mr P had been gifted when she was aware she would need to make a financial contribution towards the cost of her care (as she had done from 2012 onwards) and it therefore regarded the money as “notional capital” as the Care Act guidance defined it (“In some circumstances a person may be treated as possessing a capital asset even where they do not actually possess it. This is called notional capital”)
- Mr P said he would appeal against the decision. In the event he did not do so.
- In 2017 Mrs X had a further financial assessment as she required some care services at home. She paid the full cost of her care. Mr P said at the financial assessment visits that Mrs X had given him £10,000 towards the cost of a car to enable him to visit her (as he did not live locally). He said the remainder of the money which had been given to him had been spent on decorating Mrs X’s flat and buying her furniture.
- In November 2017 Mrs X was admitted to hospital. She was assessed as needing a nursing home placement on discharge. Her social worker contacted Mr P about discharge plans. He said the Council had agreed to fund a placement to facilitate Mrs X’s discharge from hospital but that this was “without prejudice” and once the financial assessment was complete the care costs might have to be repaid.
- The Council wrote to Mr P in November after Mrs X was discharged to a nursing home to say Mrs X was assessed as able to fund her own care because of the amount of notional capital. An officer spoke to Mrs P in December and explained that the option open to the Council was to charge Mrs X according to her current income and invoice the recipients of the notional capital (Mr and Mrs P) the rest of the charge.
- Mr and Mrs P appealed against the Council’s decision. The Council responded in January 2018. It said Mrs X had been known to the Council as a recipient of care services since 2006; she had previously been assessed financially as a full-cost payer and at the time that she had gifted the money to Mr P, she was already in receipt of services and could have anticipated that she would need more care in the future for which she would be means-tested. It did not uphold the appeal. It advised Mr and Mrs P to apply for the higher rate of Attendance Allowance for Mrs X; it also outlined the options for payment of the care home fees, with Mrs X paying a client contribution from her income and Mr and Mrs P paying a “top-up” fee for the remaining charges.
- Mr and Mrs P appealed again against the decision that Mrs X possessed the notional capital. They sent care invoices and receipts for costs incurred by Mrs X.
- The Council replied in February. It reduced the amount of notional capital taking into account Mrs X’s two-week respite stay in November 2015. It explained that costs other than care costs were not relevant to its calculations. It pointed out the statement in Mrs X’s Blue Badge application in 2014 that she was “much weaker”; and said she had already been receiving care services from the Council when she moved from her house. It did not take into account in the calculation of the notional capital the gift of £10,000 for the car purchase as this had been for Mrs X’s benefit.
- The Council said it upheld the appeal in part because of the recalculation of the respite costs. It said that the remaining costs remained payable and it explained that it would invoice Mrs X (care of Mr and Mrs P) for the assessed contribution from her income, and invoice Mr and Mrs P the remaining amount of £16,321 (the amount of notional capital – the upper capital threshold) directly.
- Mr P complained to the Ombudsman. He said Mrs X had been independent when she moved into the sheltered accommodation and had moved there principally for the company.
- The Council says that in reaching its decision it took into account that Mrs X had received services since 2006; she was receiving Attendance Allowance; she had been paying for care services since 2012; she had previously been assessed financially and so was aware of the need to contribute towards the cost of her care; and that she could have expected to have higher care needs in the future.
- The Council says it has continued to fund Mrs X’s placement “without prejudice” until the financial process was completed to avoid any unnecessary disruption to Mrs X’s care.
- The Council considered Mrs X’s finances in accordance with the Care and Support Statutory guidance. There is no evidence of fault on the part of the Council in that consideration.
- The Council has explained to Mr and Mrs P the options available for the collection of the money which is owed, and it has continued to fund Mrs X’s placement in the interim.
- There is no evidence of fault on the part of the Council.
Investigator's decision on behalf of the Ombudsman