Summary: Mrs X complained about a Council decision to charge Mr Y the full costs of his care and support. This caused distress and financial hardship. She said the Council accepted it made an error, but did not fully refund Mr Y or acknowledge the impact of its actions. We did not find fault in the Council’s consideration of Mrs X’s complaint and or in the amount it refunded to Mr Y.

The complaint

1. Mrs X complained the Council incorrectly treated a caravan purchase as a deliberate deprivation of capital, meaning it charged Mr Y the full costs of his care and support. This caused distress and financial hardship.
2. Mrs X said the Council later accepted its error, but has not refunded Mr Y the correct amount and has not properly acknowledged the impact of its actions.
3. Mrs X considers Mr Y is still due a further refund of over £17,000.

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The Ombudsman’s role and powers

4. 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 significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
5. If we are satisfied with an organisation’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. As part of the investigation, I considered the complaint and the information Mrs X provided.
7. I made written enquiries of the Council and considered its response along with relevant law and guidance.
8. Mrs X 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

Charging for care and support

9. Where a council has decided to charge for care, it must carry out a financial assessment to decide what a person can afford to pay. It must then give the person a written record of the completed assessment. A council must not charge more than the cost it incurs to meet a person’s assessed eligible needs.
10. The financial limit, known as the ‘upper capital limit’, exists for the purposes of the financial assessment. This sets out at what point a person can get council support to meet their eligible needs. People who have over the upper capital limit must pay the full cost of their residential care home fees. Once their capital has reduced to less than the upper capital limit, they only have to pay an assessed contribution towards their fees. Where a person’s resources are below the lower capital limit they will not need to contribute to the cost of their care and support from their capital.

Deprivation of assets

11. People with care and support needs are free to spend their income and assets as they see fit, including making gifts to friends and family. This is important for promoting their wellbeing and enabling them to live fulfilling and independent lives. However, it is also important that people pay their fair contribution towards their care and support costs. (Care and Support Statutory Guidance, paragraph 8.27)
12. 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 local authority may either charge the person as if they still possessed the asset or, if the asset has been transferred to someone else, seek to recover the lost income from charges from that person. (Care and Support Statutory Guidance, paragraph 8.28)

What happened

13. I have summarised below some key events leading to Mrs X’s complaint. This is not intended to be a detailed account of what took place.
14. Mrs X complained to the Council in March 2024. She said Mr Y bought a caravan in November 2021 using pension funds. The Council determined this was a deliberate deprivation of assets and assessed Mr Y as a self-funder.
15. Mrs X said Mr Y wished to own a caravan to take holidays, and that was the sole reason he bought one. Deprivation requires a subjective intention to deprive oneself of an asset deliberately to reduce their contribution to the cost of their care and support. Mr Y has impaired decision-making capacity and did not understand the impact the caravan purchase would have on his care arrangements. Mrs X said Mr Y did not intend to deliberately deprive himself of an asset.
16. The Council responded to the complaint in April 2024. It agreed to review its decision Mr Y had deliberately deprived himself of his assets. It said the original decision was made because it had concerns about the level of control a family member had over Mr Y’s finances. It agreed Mr Y had the right to spend his money as he saw fit, and did not dispute his wish to own a caravan. But it said he was inconsistent about this, and it explained several times to Mr Y and his family that he lacked capacity to make this decision, so the family should apply to the Court or Protection. However, the family proceeded to buy the caravan anyway. It also said all the money for the purchase came from Mr Y, but the caravan was registered as jointly owned by him and a family member. The Council said it had significant concerns and felt this family member was deliberately trying to avoid Mr Y paying for his care. However, the Council accepted this did not amount to Mr Y deliberately depriving himself of his assets.
17. The Council asked Mrs X for confirmation of Mr Y’s pension income so it could re-assess his finances. It confirmed it would refund Mr Y if this resulted in a credit.
18. After completing a reassessment, the Council credited Mr Y’s care and support account with £26,382.40 in June 2024. However, at the same time the Council billed Mr Y £592 for current charges. The total credit was therefore £25,790.40.
19. The debt on Mr Y’s account before the credit was £17,547.22. After applying the credit, this left a balance of £8,243.18 which the Council refunded to Mr Y.
20. Mrs X questioned whether the Council had fully refunded Mr Y, and asked it to explain its calculations.
21. The Council emailed Mrs X on 24 July 2024. It said it previously billed Mr Y £28,020.25 for charges between October 2021 and March 2022. After a re-assessment, the Council reduced the charges for this period to £1,346.85. This meant the Council had overcharged Mr Y by £26,382.40. The Council therefore applied a credit to his account in this amount.
22. Before the credit, Mr Y’s account had a debt of £17,547.22. There was also a new, correct, charge of £592 for Mr Y’s care between April and May 2024. This resulted in a credit balance on Mr Y’s account of £8,243.18.
23. The Council said it was satisfied the charges and credits applied to Mr Y’s account are correct.

My investigation

24. Mrs X told me the Council applied a credit of £25,547.22 after the re-assessment, but only refunded Mr Y £8,243.18. This was because of a debt totalling £17,547.22 for unpaid invoices. Mrs X argues the financial assessments underpinning those invoices were incorrect, and if the Council had done things correctly from the start it would not have raised those invoices and there would be no debt. This would mean the Council could repay all the remaining credit to Mr Y.
25. The Council told me it billed Mr Y £28,020.25 for the period between 9 October 2021 and 25 March 2022 when it was charging full costs.
26. The Council said Mr Y did not make any payments in this period. However, it also said it previously held deputyship for Mr Y, so it made some affordable payments towards his account on his behalf using his income during that time.
27. When the Council adjusted Mr Y’s financial assessment, it recalculated the charges for the relevant period to be £1,637.85.
28. The Council therefore credited Mr Y’s account with £26,382.40.
29. The Council said the debt on Mr Y’s account before it issued the credit note was £17,547.22.
30. The Council also said there was a new, correct, charge of £592 incurred (for the care Mr Y received while the Council was amending his account).

Analysis

31. The Council’s initial decision to treat a caravan purchase as a deliberate deprivation of assets will have been distressing for Mr Y. However, it is not the role of the Ombudsman to decide when a deliberate deprivation has taken place, that is a decision for the Council. The Council explained its concerns and the reasons for its original decision in response to Mrs X’s complaint. It then agreed to review and overturn the decision. The decision-making process therefore ran as we would expect, and I do not criticise the Council in these circumstances. I did not find fault in the Council’s complaint response.
32. Mrs X said the Council’s initial decision caused Mr Y financial hardship. On the evidence seen, Mr Y he did not pay any of the Council’s invoices in full, and the Council only took affordable payments from him.
33. The Council charged Mr Y £28,020.25 between October 2021 and March 2022.
34. It said the charges should have been £1,637.85, meaning it overcharged Mr Y by £26,382.40.
35. The Council said the debt on Mr Y’s account, through non-payment of its invoices, was £17,547.22. Applying a credit of £26,382.40 would leave a credit balance of £8,835.18. Adding a further charge of £592 for Mr Y’s ongoing care leaves a credit balance of £8,243.18. This is the amount the Council refunded to Mr Y.
36. The Council’s email to Mrs X dated 24 July 2024 caused some confusion, as it said the new total of care costs between October 2021 and March 2022 was £1,346.85. However, there was an error in this calculation. The correct figure was £1,637.85, which the Council confirmed to me in response to my enquiries. The difference here is only £291, whereas Mrs X believes the Council owes Mr Y more than £17,000.
37. Mrs X may have thought the Council would refund Mr Y the full £26,382.40 which it overcharged him by. However, while the Council did incorrectly charge Mr Y full costs for a period of about five months, Mr Y did not make full payments during that time. He had a large debt on his account and would only be due refunds for overpayments he actually made.
38. I did not find fault in the Council’s calculations, or in the amount it refunded Mr Y.

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Final Decision

39. I did not find fault in the Council’s consideration of Mrs X’s complaint or in the amount it refunded to Mr Y.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman