Darlington Borough Council (19 001 435)

Category : Adult care services > Assessment and care plan

Decision : Upheld

Decision date : 17 Oct 2019

The Ombudsman's final decision:

Summary: Mr X complained about how the Council assessed his mother, Mrs Y’s, financial contribution towards the cost of care. The Council was at fault in the way it made and communicated its decisions.

The complaint

  1. Mr X complained for his mother, Mrs Y, about the Council’s decision to include a lump sum payment from the Department for Work and Pensions in his mother’s financial assessment after it had agreed to discount the sum from all future assessments.
  2. He also complained the Council treated cash gifts Mrs Y made to her children as deprivation of assets, after it agreed it would not.

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The Ombudsman’s role and powers

  1. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
  2. 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)
  3. 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)

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How I considered this complaint

  1. As part of the investigation I have considered the following:
    • The complaint and the documents provided by the complainant’s representative, as well as the information we discussed in a telephone conversation.
    • Documents provided by the Council and its comments in response to my enquiries.
    • The Care Act 2014
    • The Care and Support Statutory Guidance (Updated 26 October 2018)
  2. Mr X and the Council both had an opportunity to comment on a draft of this decision.

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What I found

  1. Councils can make charges for care and support services they provide or arrange. They must assess a person’s finances to decide what contribution he or she should make to their care charges. They should take a person’s capital and savings into account subject to certain conditions. If a person’s capital is over the upper capital limit of £23,250 he or she will be liable to meet the full cost of their care. Once their capital has reduced to less than the upper capital limit, they must only pay an assessed contribution.
  2. The Care and Support Guidance 2014 (The Guidance) says people should be able to spend their money as they wish, including making gifts to family and friends. However, it is important people pay the contribution they are responsible for towards their care costs. It says a local authority should ensure people are not rewarded for trying to avoid paying their assessed contribution.
  3. There are some cases where a person may have tried to deliberately avoid paying for care and support costs through depriving themselves of assets, either capital or income. In such cases, the Council may either charge the person as if they still had the asset or, if the asset has been transferred to someone else, seek to recover the lost income from that person.
  4. Deprivation of assets means where a person has intentionally deprived or decreased their overall assets to reduce the amount they are charged towards their care. This means that they must have known that they needed care and support and have reduced their assets to reduce the contribution they are asked to make towards the costs.
  5. Local authorities should not assume someone has intentionally deprived themselves of assets to reduce their contribution to care fees. Paragraph 11, Annex E of The Guidance says there may be other valid reasons. It says, when deciding whether the purpose of the deprivation was to avoid care fees, local authorities should consider:
    1. 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?
    2. did the person have a reasonable expectation of needing to contribute to the cost of their eligible care needs?
  6. Past case law says local authorities cannot look into the mind of the person. They can only look at the nature of the proposal within the context of the time and circumstances in which it took place.
  7. There is a basic principle, established by the courts, that councils need to explain the reasons for their decisions. It is not enough to say a decision is in line with the Statutory Guidance; the Council needs to explain why this is the case. Specifically, it needs to address the two questions in paragraph 11, Annex E of the Statutory Guidance.
  8. If a local authority decides a person has intentionally deprived themselves of assets to avoid paying care fees, it may treat those assets as notional capital in its financial assessment. Notional capital is where the local authority counts the value of the assets in its financial assessment, as if the person still owned them.

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What happened

  1. Mr X has power of attorney to handle his mother, Mrs Y’s, affairs.
  2. The Department for Work and Pensions (DWP) contacted Mr X in February 2018 to tell him that it had made an error in calculating Mrs Y’s pension payments since 2008. As a result, Mrs Y received a lump sum payment of £7,362.12.
  3. Mr X contacted the Council by telephone to tell it about the payment. He explained it was the result of a DWP error and was not savings or a windfall. He asked the Council to discount the payment from Mrs Y’s future financial assessments. Mr X states the Council agreed.
  4. Mr X wanted confirmation in writing, so he sent an email to the Council on 5 March 2018 asking it to confirm it would discount the payment as capital from all future financial assessments.
  5. The Council replied and confirmed that it would not take the DWP payment into account as a capital.
  6. Mr X said he also told the Council of Mrs Y’s wish to make a gift of £2,000 each to her two children. This was to recognise the care and support they had provided since her husband’s death in 2008. Mr X said the Council told him this was not a problem.
  7. The Council wrote to Mr X on 26 October 2018 to tell him that it had carried out an assessment of Mrs Y’s contributions. It told him it had not counted the DWP payment, but it would be from February 2019 as it had discounted the payment for 52 weeks. It had included both £2,000 gift payments Mrs Y made to her children as notional capital. It said that it had discussed this on the telephone with Mr X.
  8. Mr X told me that a Council officer did contact him to explain this, but he did not understand the reasoning behind the Council’s decision.
  9. On 13 December 2018 the Council wrote to Mr X to confirm it was discounting the DWP payment until February 2019. It told him it had included the gift payments Mrs Y made to her children as notional capital because the Council had funded her care since 2017. She was aware of a tariff on capital above £14,250.00 and she should have been aware that any decrease in her capital could reduce the amount she would have to pay towards the cost of her residential care.
  10. Mr X complained to the Council on 9 January 2019 and asked it to exclude the £4,000 gift payments from Mrs Y’s financial assessments.
  11. The Council did not uphold Mr X’s complaint. It said it would have treated the gifts of £4,000 as notional capital if it had not been disregarded from the backdated award.
  12. On 6 March 2019 Mr X wrote to the Council to raise issues with its complaint investigation report. He said Mrs Y wanted to give gifts to her children because of the care they had provided since her husband died. She could not do so until she received the DWP payment. He asked the Council to explain what notional capital meant and said the gifts were not capital avoidance as he had contacted the Council to seek its agreement before Mrs Y made the gifts. He stressed the payment was because of a DWP error and it had agreed not to include it in future benefit assessments so why could the Council not agree to do the same. He also referred the Council to the email exchange from 5 March 2018 where the Council had made no mention of only discounting the payment for 52 weeks.
  13. I am not aware the Council made any further reply to Mr X’s complaint.
  14. Mr X complained to the Ombudsman on 26 April 2019 as he believed the Council should discount the DWP payment from all future financial assessments.

Response to my enquiries

  1. The Council told me it had agreed to discount the DWP payment as it mistakenly believed it was one of the benefits the Care Act says should be disregarded for 52 weeks.
  2. It said Mr X should have received correspondence on its decision to exclude the lump sum, with an explanation this was for 52 weeks, but this did not happen until October 2018. It also said its email in reply Mr X’s email dated 5 March 2018 should have been more detailed and should have explained it had only agreed to discount the payment for 52 weeks.
  3. On the gifts Mrs Y made to her children, the Council said powers of attorney were registered in December 2017 and as the gifts were made after this date it decided the gifts were not Mrs Y’s decision. It therefore considered the gifts deprivation of assets.
  4. It said it had no record of a conversation with Mr X discussing the gifts but when it carries out assessments it advises individuals it will include gifts in the assessment as notional capital.
  5. The Council said it could not comment on the DWP’s decision to discount the sum from all future assessments, but it followed the relevant guidelines when it made its decision.

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Analysis

  1. The Council has confirmed it mistakenly believed the DWP payment was a benefit which should be disregarded for 52 weeks under the Care Act. It also should have communicated its decision to Mr X properly. It did not do so until October, about 8 months later. That was fault.
  2. Mr X thought the Council had agreed to disregard the payment from all future assessments. When he asked it to confirm this in writing, the Council’s response was vague. It agreed not to take the payment into account as capital, but it was silent on whether this was for all future assessments. It accepts it should have been clearer in its response. That was also fault. However, on balance, based on the available evidence, I do not believe the Council intended to disregard the payment from all future assessments. If it had intended to do so, it would have confirmed this in reply to Mr X’s email rather than the non-committal response it gave.
  3. The Council has discretion when it comes to charging for the care it provides. Mr X may feel that it is unfair, but the Council has the right to assess the DWP payment as part of Mrs Y’s capital.
  4. Mr X also thought the Council had agreed to Mrs Y gifting £2,000 to her two children. Unfortunately, there is no record of their discussion and the Council has provided conflicting reasons for this decision. In its letter to Mr X of 26 October 2018 it told him it considered Mrs X had deprived herself of assets because she had contributed to the cost of her care since 2017 and knew that lowering her assets could lower her contributions. However, in response to my enquiries the Council told me it treated the gifts as deprivation of capital because Mr X had power of attorney and so Mrs Y did not make the decision herself.
  5. It is clear Mrs Y made lump sum payments to her children. The Guidance highlights this as one way in which deprivation may occur. However, the Council should not assume it was to avoid paying care fees. It must consider the timing of the gift and whether the person had a reasonable expectation of care needs.
  6. It is also clear Mrs Y did have a reasonable expectation, as she has received care since 2017. It is therefore for Mrs X’s representatives to provide evidence her aim was not to avoid paying for care. I have not seen any evidence to show the Council has considered this or asked Mrs X’s representatives to provide such evidence.
  7. There is no evidence or record of the conversation Mr X says he had with Council officers about the gifts, but equally there is no evidence or record of the Council’s consideration in deciding Mrs Y had intentionally deprived herself of capital. It has not asked Mrs Y or Mr X about this. The letter the Council sent to Mr X on 26 October 2018 only deals with the question of whether there has been a deprivation, it does not properly address the subjective purpose of the disposal.
  8. The decision on deprivation is ultimately for the Council to make, it is not the role of the Ombudsman. However, it should be clear how the Council reached its view on the motivation behind the disposal of capital and it is not clear the decision has been properly reached. The Council failed to apply the subjective test with enough clarity. That was fault.
  9. The Council’s complaint response did not properly address the issues which Mr X had raised. It did not provide reasons or a full explanation for the decisions it had taken. That was fault.

Did the fault cause an injustice?

  1. The Council erred in deciding the DWP payment should be disregarded for 52 weeks. The Council was entitled to include the payment in Mrs Y next assessment and in this instance, she benefitted from the Council’s fault. Therefore, there was no injustice in respect of the disregard period.
  2. However, the Council’s failure to tell Mr X or Mrs Y about the 52-week disregard period for eight months caused distress and uncertainty. This was compounded by the Council’s failure to properly explain why it had decided Mrs Y had intentionally deprived herself of capital. This is her injustice.

Agreed action

  1. Within four weeks of my final decision the Council should reconsider whether, in all circumstances, Mrs Y has intentionally deprived herself of capital to avoid care and support charges. It should involve Mrs Y in this process and fully explain its decision.
  2. Within eight weeks of my final decision the Council should identify the action it needs to take to ensure officers keep better records, explain their decisions quickly and properly, and refer to The Guidance.

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Final decision

  1. I have completed my investigation. There was fault causing injustice in how the Council made and communicated its decisions on Mrs Y’s financial contributions towards the cost of her care.

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Investigator's decision on behalf of the Ombudsman

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