Summary: Mrs J complains about the Council’s request that her son pay backdated contributions towards his care charges. We uphold the complaint finding that Mrs J (who manages her son’s finances) could not have realised some of the contributions paid by her son were wrong. The Council also missed opportunities to correct this sooner. We consider this caused injustice as the bill the Council sent to Mrs J was too high as a result. The Council accepts this finding and agrees to write off some of the charges and apologise to Mrs J. It will also pay her £200 to reflect distress caused by some poor communications.

The complaint

1. I have called the complainant ‘Mrs J’. She acts as an appointee for her son ‘Mr K’ who does not have capacity to manage his financial affairs. Between August 2016 and March 2018 the Council wrongly assessed Mr K’s financial contribution to his care charges. It has asked Mrs J to arrange for payment of around £2480 in backdated charges Mr K should have paid. Mrs J complains the Council:
• Should have carried out an assessment of Mr K’s finances sooner, meaning it would have discovered its error sooner.
• Has not considered Mr K’s ability to repay the backdated charges it has asked for.
2. Mrs J says this means the Council expects Mr K to pay money he cannot afford. She considers this unfair given the delay in its financial assessment.

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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. 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

5. Before issuing this decision statement I considered the following:
• Mrs J’s written complaint to the Ombudsman and supporting information she provided in a telephone call.
• Information provided by the Council in response to written enquiries.
• Relevant law and government guidance referred to in the text below.
6. I also sent both Mrs J and the Council a draft decision setting out my proposed findings and inviting their comments. In response to comments made by the Council I amended my initial draft and gave both further time to comment on a revised draft decision.

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What I found

The key facts

7. The beginning of the events covered by this complaint is August 2016. Mr K lived at the family home with Mrs J. He is an adult with both learning and physical disabilities. He was in the transition of moving from the family home into supported living accommodation. He received income support of £105 and disability living allowance of £77 a week (figures rounded to the nearest pound). He received care at home from Mrs J with some care arranged by the Council. The Council sent a letter to Mr K before he moved, in July 2016, saying he should pay £29 a week towards his care. The letter said in bold type for emphasis: “if there are any changes in the future to your finances you must inform us so we can review your assessed charge”.
8. From 5 August 2016 Mr K stopped receiving income support and began receiving employment support allowance (ESA), at £125 a week.
9. Between August 2016 and March 2018 Mr K also stopped receiving disability living allowance and began receiving personal independence payments instead. This was a combined rate of £140 in March 2018.
10. On 29 August 2016 Mr K moved into supported living accommodation.
11. As part of the planning for Mr K’s move to supported living the Council undertook an assessment of his needs. This included a section about finances, which identified the support given by Mrs J. The accompanying notes said completing this part of the assessment would “trigger a financial assessment”. However, the Council undertook no financial assessment when Mr K moved into supported living. Nor did Mrs J tell the Council of those changes in Mr K’s income set out in paragraphs 8 and 9. So, his contributions continued at £29 a week.
12. In March 2017 the Council undertook a check with the Department for Work and Pensions which identified Mr K now received ESA. However, it did not act on this information.
13. In April 2017 the Council wrote to Mrs J advising of the ‘annual uprating’ of welfare benefits and enclosing a copy of Mr K’s ongoing financial assessment. There was no significant change to Mr K’s contribution which remained around £29 a week. The letter clearly identified Mr K received income support and disability living allowance. Mrs J did not contact the Council to advise these benefits had changed.
14. In March 2018 the Council undertook a further check with the Department for Work and Pensions. This again identified Mr K receiving ESA. This time the Council acted on the information and reassessed Mr K’s financial contribution. It backdated the assessment to 5 August 2016 when ESA went into payment.
15. That assessment also took account that after Mr K moved to supporting living the Council should have calculated his contribution differently. In simple terms while he lived at home, the Council disregarded some of Mr K’s DLA to take account of his night-time care needs, resulting in a lower financial contribution. But it did not do this once he moved to supported living.
16. The Council wrote to Mr K saying his contribution would increase to £57 a week. It also said it would backdate the increased charge to August 2016. The Council said it would invoice Mr K for the balance of £2480 in underpaid care contributions between August 2016 and March 2018. The letter said, “if you are having difficulties paying the balance […] please contact us”. The Council’s letter did not explain why the charge had increased or why the Council had decided to backdate it.
17. After receiving an invoice Mrs J challenged the Council’s actions and it has put recovery of the £2480 balance on hold. The Council says it “made the suggestion” Mrs J pay £120 a month from Mr K’s income towards his debt. This was after Mrs J completed an income and expense form showing that after paying the current assessed contribution Mr K has around £150 in income. She says she must pay £120 to the supported living provider for food and other living costs, such as utilities. That leaves around £30 a week for any other expenses Mr K has including when he comes to the family home at weekends or needs clothes.
18. In reply to Mrs J’s complain about the invoice the Council reminded her of the statements it includes in letters advising users to tell it of changes in income (see paragraph 7). It also said that “it only came to light in 2018 that [Mr K] began to receive a different kind of benefit in August 2016 and therefore backdated charges take account of this rise in income, which had never been reported”.
19. During this investigation, the Council recognised it should not have retrospectively asked Mr K to pay a higher financial contribution from 5 August 2016 as he had not moved at that time. It should only have applied the increased charge from the end of August 2016. So, the Council corrected its records to take account of this, reducing the sum billed to Mr K by £80.

Relevant legal and policy considerations

20. Section 14 of the Care Act 2014 says that councils have discretion about whether to charge someone receiving care and support a contribution towards the cost of their care. If it charges, a council must take account of relevant Regulations and the Care and Support Statutory Guidance.
21. The guidance says: “A local authority must regularly reassess a person’s ability to meet the cost of any charges to take account of any changes to their resources. This is likely to be on an annual basis but may vary according to individual circumstances” (Section 8.17).
22. It also says “local authorities should develop and maintain a policy” around charging. Among other matters, this is to ensure:
• It does not charge people more than it is “reasonably practicable” for them to pay.
• Consistency, to reduce variation in the way people are assessed and charged.
• Transparency, so people know what they will be charged (Section 8.45).
23. The Council has a Charging and Financial Assessment Policy. This reinforces key messages around financial assessments contained in the Care and Support statutory guidance. For example, setting out the principle the Council can charge for most care services but also explaining some exceptions to this rule. It does not cover administrative matters such as how or when someone receiving care services will receive a financial assessment, nor how it will review such assessments.
24. Annex D to the Care and Support Statutory Guidance covers the issue of debt recovery, where users of services have unpaid care charges. This says that before considering repayment councils “should consider whether it is appropriate to recover the debt”. It says the Council should consider issues including:
• “where the amount of the debt is small and the costs of recovery would be disproportionate
• the person or their representative could not reasonably have been aware that the asset in question needed to be included in the financial assessment” (point 9).
25. The Guidance also says that one of the principles underpinning debt recovery is that “repayments must be affordable” (point 6).
26. The Council has a corporate debt policy. This refers to different types of debt owed to the Council (for example, outstanding council tax or housing benefit overpayments). It does not make specific reference to debts owed for care contributions or the government guidance quoted above. In a section addressing the general principles of debt recovery the policy refers to the importance of transparency which it says includes “explaining clearly the reasons for taking any recovery/enforcement action”. The policy also says the Council will act proportionately when collecting debts and take account of individual’s ability to repay.

My findings

27. I begin by noting the Council has put forward two reasons for Mr K’s assessed contribution to care charges increasing dramatically in March 2018. First, because he no longer received income support and received ESA instead. Second, because it changed how it calculated Mr K’s assessed contribution taking account of his night-time care needs.
28. In my view Mrs J could reasonably have alerted the Council to the change in Mr K’s income. The Council gives users of its care services clear information on telling it about changes of income. When Mr K began receiving ESA this resulted in him receiving an extra £20 a week. So, this was not a minor change. I considered there would be nothing unreasonable in the Council starting from the presumption that it could recover backdated care charges arising from this change.
29. However, I do not consider Mrs J could reasonably have known of the change in calculation of Mr K’s night-time care needs. Only someone with expert knowledge of care charging would know this. The Council should therefore have started with the opposite presumption. That it would not recover backdated charges arising from this change. This would be consistent with the Government advice I quoted at paragraph 24. I consider it was fault therefore for the Council to try and recover this part of the backdated charge.
30. I also consider it was fault for the Council to try to recover any backdated charge incurred before 1 September 2017. For 20 months Mr K lived in supported living with no financial assessment. I accept the Council sent ‘annual uplift’ letters in this time which may have triggered a financial re-assessment. In some cases, these may be sufficient to meet the government expectation the Council review a client’s financial assessment every twelve months. But not in a case where the Council knows there has been a change in circumstance which could affect the charge, such as a move from living with family to supported living. Had Mrs J responded to those letters, at best this would only have led the Council to correct Mr K’s income. I reiterate that only the Council could have known that changes in Mr K’s care, associated with his move, would result in a change of premium that also impacted on his assessment .
31. I find the Council should have pro-actively undertaken a reassessment of Mr K’s financial assessment within 12 months of him moving into his supported living. This also takes account that within this timeframe the Council learnt via the DWP that Mr K had begun receiving ESA but did not act on that initial notification either.
32. Underlying these faults is a gap in the Council’s current policy. Its charging policy should address matters such as how often it will undertake financial assessments and what format such assessments will take. It should also have as part of that policy, a link to guidance on recovery of arrears of contributions. Before the Council writes to a user of care services asking for recovery of backdated charges it must consider if that is reasonable in the circumstances of the case. The lack of any policy guidance to officers that explains this requirement justifies another finding of fault. I find the corporate recovery policy generally does not address debts owed for care charges and refer to the specific government guidance on that.
33. I also consider this complaint highlights some poor communications, which do engage that section of the debt recovery policy that highlights the need for transparency. The notice the Council sent to Mr K advising of its revised assessment in March 2018 did not explain the cause of such an increase in his contributions. The Council then compounded this poor communication when replying to Mrs J’s complaint. It was unacceptable for the Council to say it did not know of Mr K’s change in income in March 2018 when it had known for 12 months. It was also unacceptable for it still not to offer a satisfactory explanation for the increased contribution, implying it all arose from Mr K’s change in income when this was not the case. These poor communications also justify a finding of fault.
34. Finally, I also have some concern about the Council’s attempts at recovery in this case. I recognise it has showed patience in not pursuing recovery while Mrs J pursues her complaint and that goes to its credit. It also says its suggested repayments of £120 per month were a basis for discussion, implying it was open to Mrs J to negotiate a lesser amount. But I cannot see how Mr K could ever afford the suggested amount. Because this would deprive him of all surplus income once Mrs J paid his ongoing care charges and living costs. Mr K will need money to meet other needs; clothing being just one example. I stop short of finding fault recognising negotiation was at an early stage. But government guidance is clear that affordability of repayments is a core principle in any recovery arrangement.
35. The faults described above have caused injustice to Mr K and Mrs J. In Mr K’s case the Council has sought to recover sums from him which it should never have done so. While Mr K lacks capacity to deal with his financial affairs this will have caused distress to Mrs J. I also consider the Council compounded Mrs J’s distress with its poor communications.

Agreed action

36. We publish guidance on our website which explains our detailed approach to remedies and the action agreed with the Council to remedy this complaint takes account of that. Our first principle is that we aim to put the complainant in the position that they should have been in had fault not occurred.
37. In this case, to remedy the injustice caused to Mr K and Mrs J the Council has agreed that within 20 working days of this decision it will:
1. Provide Mrs J with a written apology accepting the findings of this investigation.
2. Write off all sums owing for backdated care charges by Mr K that pre-date 1 September 2017.
3. Of the remainder, calculate the percentage of the outstanding backdated care charges attributable to the change in calculation resulting from Mr K’s night-time care needs and write this off also.
4. Write to Mrs J with its calculation of any remaining sums owing (i.e. showing the calculations and b) and c) above) and invite her proposals for repayment (unless the Council should decide it is uneconomic to recover the balance). The Council should refer to Annex D of the Care and Support Statutory Guidance in deciding whether to accept any proposals made by Mrs J.
5. Pay Mrs J £200 in recognition of the distress caused by its actions and poor communications.
6. Arrange for a review of Mr K’s current contributions to his care to take place within three months of a final decision.
38. I also consider to learn lessons from this complaint the Council needs to review its current guidance given to officers around charging for care, financial assessments and recovery of care debts. I note that this is one of several decisions we have issued since June 2018 highlighting failures in charging. Some of those share themes with this complaint. For example, poor written communications failing to explain the reasons for charges included in an invoice. Or failing to carry out an adequate financial assessment in good time.
39. The Council has agreed that within three months of this decision it will begin a review of current policy towards charging, financial assessments and recovery of debt. It will aim to complete this within six months of today’s date. The review will take account of the Care Act, relevant Regulations and statutory guidance. Revised Council policy should include:
1. A reconsideration of how it carries out annual reviews of financial contributions. The current practice of sending an ‘uprating’ letter each April may not be enough in all cases to meet the expectations placed by government when it comes to carrying out a financial assessment. It should consider especially the circumstances of those who change accommodation with potential impact on premiums used to calculate their charges.
2. Addressing the need for effective communications when notifying users of services of changes in their assessed charges. Users must be able to understand why their charge has changed.
3. Ensuring officers check the reasonableness of recovering backdated care charges before attempting such recovery.

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Final decision

40. For reasons set out above I uphold this complaint finding fault by the Council causing an injustice to Mrs J and Mr K. The Council has accepted this finding and agreed action that I consider provides for a fair remedy to the complaint. Consequently, I can now complete my investigation satisfied with its actions.

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Investigator's decision on behalf of the Ombudsman