Summary: Mrs C complains the Council’s charging assessment for residential care is wrong. The Council is at fault for failing to consider motivation when concluding there was a deprivation of assets. This has caused uncertainty about whether the assessed charge is correct. The Council has agreed to apologise to the complainant, reassess the charge taking into account motivation, and remind staff of the need to consider motivation in decisions of this type.

The complaint

1. Mrs C and Mr C are the daughter, and son in law of Mrs D. Mrs D has now passed away.
2. Mrs C and Mr C complain the Council has wrongly concluded that Mrs D gave away money to avoid paying for care costs. This resulted in them having to use their own money to cover residential care fees.

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The Ombudsman’s role and powers

3. 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)
4. 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)
5. 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)

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How I considered this complaint

6. I spoke with Mrs C and considered the information she provided as part of her complaint. I considered the Council’s assessment of charge and the correspondence that it sent to Mrs C as part of her appeal.
7. I also considered:-
• Care and Support (Charging and Assessment of Resources) Regulations 2014;
• Care and Support Statutory Guidance 2014; and,
• East Sussex “Charging for care and support policy and procedures – final draft”.
8. Mrs C and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Background information

9. Mrs D was living independently in her own home with support from paid carers arranged by the Council. Mrs D was finding it difficult to manage at home and wanted to move in with Mrs C. At the time Mrs C and Mr C were at the point of retiring and downsizing. They intended to move out of their property and had engaged an estate agent.
10. In late 2016 Mrs D had a fall and was admitted to hospital. In 2017 Mrs D gave Mrs C and Mr C just over £60000 so they could pay off their mortgage.

Legal and administrative background

11. The Care and Support (Charging and Assessment of Resources) Regulations 2014, and the Care and Support Statutory Guidance 2014 (“the Guidance”) set out the charging rules. When a council decides to charge for care, it has to follow these rules when deciding how much a person has to pay towards their care.
12. The Guidance says anyone with over the upper capital limit (currently £23,250) can pay the full cost of their care.
13. Annex E of the Guidance deals with the deprivation of assets. It says:
14. 3) “When undertaking or reviewing a financial assessment a local authority may identify circumstances that suggest that a person may have deliberately deprived themselves of assets in order to reduce the level of the contribution towards the cost of their care. In such circumstances, the local authority should have regard to this guidance. Clearly, local authorities should treat this issue with sensitivity and care.”
15. 4) “People should be treated with dignity and respect and be able to spend the money they have saved as they wish – it is their money after all. Whilst the Care Act 2014 represents an important step forward in redefining the partnership between the state and the individual, it is important that people pay the contribution to their care costs that they are responsible for. This is important to the overall affordability of the care and support system. A local authority should therefore ensure that people are not rewarded for trying to avoid paying their assessed contribution.”
16. 5) “But deprivation should not be automatically assumed, there may be valid reasons why someone no longer has an asset and a local authority should ensure it fully explores this first. However, the overall principle should be that when a person has tried to deprive themselves of assets, this should not affect the amount of local authority support they receive.”
17. 11) “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:”
18. “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?”
19. “did the person have a reasonable expectation of needing to contribute to the cost of their eligible care needs?”
20. 12) “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.”
21. 18) “If a local authority decides that a person has deliberately deprived themselves of assets in order to avoid or reduce a charge for care and support, they will first need to decide whether to treat that person as still having the asset for the purposes of the financial assessment and charge them accordingly.”
22. 19) “As a first step, a local authority should seek to charge the person as if the deprivation had not occurred. This means assuming they still own the asset and treating it as notional capital or notional income.”
23. East Sussex “Charging for care and support policy and procedures – final draft” says, “The decision to treat a person as still having capital will be taken in accordance with the Care and Support Statutory Guidelines. Annex E: Deprivation of Assets.”

What happened

24. In 2017 Mrs D moved in with Mrs C and Mr C. A few months afterwards Mrs D needed full time care and entered a residential care home. The Council assessed Mrs D’s charges and considered the money she had gifted her daughter. The Council said Mrs D had deprived herself of this money and it could therefore consider it as part of her capital. This is known as “notional capital”.
25. Mrs C and Mr C appealed the decision. The Council did not change its view. It based its decision on the following:-
• Mrs D was aware there was a charge for residential care and about notional capital. This is because she was provided with an information leaflet in April 2017 about notional capital and she did not attempt to contact the Council for advice prior to the gift;
• Mrs D did not get legal advice before gifting the money;
• The timing of the gift was just before Mrs D needed residential care and given Mrs D’s history of needing help it was foreseeable that she would need residential care.
26. Mrs C asked the Council to make an allowance for the time Mrs D was living with her and she was providing care. The Council made an allowance up to the value of the Minimum Income Guarantee. This is the amount the government says a person needs to live on. It did not make an allowance for money Mrs D saved by not paying for care fees because she was living with Mrs C who cared for her.
27. Mrs C says that Mrs D’s savings ran out before she died and as a result Mrs C and Mr D had to use £10,000 of their own money to cover the cost of Mrs D’s care.

Is there fault causing injustice?

28. There is no dispute that Mrs D gifted money which made her less able to pay for care costs. The issue for the Council is whether “avoiding the care and support charge was a significant motivation in the timing of the disposal of the asset”.
29. The Guidance says local authorities need to fully explore the reasons for a disposal. In this case the Council has referred to the knowledge Mrs D had at the time, and the timing of her disposal. However it does not comment or make enquiries about the motivation for the disposal. Namely, the giving of funds so Mrs C and Mr C could remain living in their home so Mrs D could move in with them. The failure of the Council to properly consider, or record its consideration, of motivation is fault.
30. Mrs C and Mr C have the injustice of uncertainty about whether but for the fault identified the Council would have reached a different decision.
31. Mrs C says the Council should make an allowance for care she provided which saved Mrs D residential care fees. The Council does not explain why it has not included the money saved by Mrs D in its calculation. I consider a failure to properly explain its reasoning is fault.
32. While Mrs C has the injustice of not knowing why the Council has rejected her arguments, I am unable to say any fault in this aspect of the complaint has caused Mrs C any financial loss. This is because an allowance of the maximum cost of care, (the private rate care fees actually paid by Mrs D of £1113 per week) for the period Mrs D stayed with Mrs C; does not exceed the assessed notional capital the Council calculated.

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Agreed action

33. I consider there is fault in the actions of the Council which has caused Mrs C and Mr C injustice. The Council has agreed to take the following actions to remedy the complaint:-
1. apologise to Mrs C and Mr C for the failure to properly consider notional capital;
2. reconsider Mrs D’s capital considering her motivation at the time of making the gifts. This should be completed by someone who had no knowledge of the case. Provide written reasons for any decisions made;
3. remind staff about the need to include/record motivation when making decisions about a deprivation of assets.
34. The Council should complete (a)-(b) within one month of the final decision and (c) within three months of the final decision.

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Final decision

35. I have found fault causing injustice and consider the agreed actions above are suitable to remedy the complaint. I have now completed my investigation and closed the complaint.

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Investigator's decision on behalf of the Ombudsman