Summary: The Ombudsman found fault with the way the Council decided not to complete a fresh financial assessment when the administrator of a woman’s estate provided information demonstrating her circumstances had changed. This left the woman’s estate at a potential financial disadvantage. The Council agreed to complete a further financial assessment to recalculate the complainant’s contributions to her care charges and reimburse her estate if appropriate.

The complaint

1. The complainant, who I will call Mr T, is complaining about the Council’s decision not to carry out a further financial assessment to recalculate his mother’s (Mrs G) contributions towards the cost of her residential care when her circumstances changed.
2. Mr T says the Council’s refusal to reassess Mrs G’s care contributions has left her estate at a financial disadvantage.

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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 provide a free service, but must use public money carefully. We may decide not to start or continue with an investigation if we are satisfied with the actions a council has taken or proposes to take. (Local Government Act 1974, section 24A(7), as amended)

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How I considered this complaint

4. In making this final decision, I considered information and documentation provided by Mr T in support of his complaint. This included copies of Mr T’s correspondence with the Council. I also considered comments on my draft decision statement from Mr T and the Council.

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What I found

Relevant legislation and guidance

Charging

5. Section 14 of the Care Act 2014 gives local authorities the power to charge for care and support services they provide or arrange.
6. The charging rules for residential care are set out in the Care and Support (Charging and Assessment of Resources) Regulations 2014 (the Charging Regulations), and the Care and Support Statutory Guidance 2014 (the statutory guidance). When the Council arranges a care home placement, it has to follow these rules when undertaking a financial assessment to decide how much a person has to pay towards the costs of their residential care.
7. The rules state that people who have over the upper capital limit (currently £23,250) are expected to pay for the full cost of their residential care home fees. However, once their capital has reduced to less than the upper capital limit, they only have to pay an assessed contribution towards their fees.
8. The council must assess the means of people who have less than the upper capital limit, to decide how much they can contribute towards the cost of the care home fees
9. A local authority must also regularly reassess a person’s ability to meet the cost of any care charges to take account of any changes to their resources. The statutory guidance is not prescriptive as to how often local authorities should reassess a person’s finances. However, Section 8.17 of the statutory guidance says that a reassessment “should take place if there is a change in circumstances or at the request of the person.”

Deferred payment agreements

10. The Care and Support (Deferred Payment) Regulations 2014 (the Deferred Payment Regulations) allow a person in a care home to enter into a deferred payment agreement with a local authority.
11. A deferred payment agreement is a formal legal arrangement with the local authority that lets people use the value of their homes to help pay care home costs. It is designed to prevent people being forced to sell their homes during their lifetime to fund their care.
12. Under a deferred payment agreement, the local authority will pay the person’s care home fees on their behalf. The person will then repay the local authority at a later date using the proceeds from the sale of their property.

Key facts

13. Mrs G had been resident in a care home for several years. She had a deferred payment agreement with the Council. This meant the Council was paying Mrs G's care fees against the value of her property.
14. Mrs G subsequently sold her property and used the proceeds of the sale to pay the outstanding fees. The Council then refunded Mrs G’s estate with the upper capital limit of £23,250.
15. In August 2019, the Department for Work and Pensions (the DWP) contacted Mr T to explain that Mrs G had been receiving Pension Credit to which she was not entitled. The DWP requested repayment of £9,076.05.
16. Mr T contacted the Council in September 2019 to explain the situation. He said the information provided by the DWP showed Mrs G’s care contributions had been incorrect as they were calculated using income to which she was not entitled. Mr T requested that the Council reimburse Mrs G’s estate for the £9,076.05 which the DWP was now seeking to recover.
17. The Council responded later that month. It said “[t]he financial assessment takes into account the value of the income and capital resources of the person receiving care at the point at which the assessment takes place. The financial assessment for [Mrs G] was accurate at the time it was carried out.” The Council concluded that it “cannot” therefore reimburse Mrs G’s estate.
18. Mr T made further representations to the Council. However, the Council said “[t]he decision you wish to challenge is based on the interpretation of legislation” and that the complaint could not be appropriately addressed through the complaints procedure.
19. Mr T then approached the Ombudsman.

Analysis

20. The Council had a duty under the Care Act to complete a financial assessment for Mrs G to calculate her contributions towards her care. It is not in dispute that the initial financial assessment was accurate and correct based on the financial information available at that time.
21. Nevertheless, Mr T has now provided the Council with evidence that demonstrates a change in Mrs G’s circumstances, albeit some time after her death. Specifically, Mr T has shown that the financial assessment was based on income (i.e. Pension Credit) to which Mrs G was not entitled and which the DWP is now seeking to recover from her estate.
22. The key consideration, therefore, is whether there are any provisions in either the statutory guidance or Charging Regulations that would prevent the Council from completing another financial assessment to recalculate Mrs G’s care contributions, taking into account the new information provided by Mr T.
23. The evidence now available shows the Council used income to which Mrs G was not entitled when calculating her care contributions (though it could not have known this at the time). This has left Mrs G’s estate at a potential disadvantage as the DWP is now in the process of recovering the overpaid Pension Credit.
24. Section 8.17 of the statutory guidance makes clear that a local authority should reassess a person’s ability to meet the cost of any care charges should there be a change in that person’s circumstances. I note the Council’s view that this duty is primarily intended to ensure a service user is able to meet the cost of any ongoing care charges and that this does not apply to Mrs G as she is now deceased.
25. Nevertheless, the fact remains that Mrs G’s circumstances have changed as a result of new information becoming available and her estate has potentially been left at disadvantage as a result. I have reviewed both the statutory guidance and Charging Regulations and have been unable to identify any provisions that prevent the Council from completing a reassessment. Indeed, I consider it in keeping with the statutory guidance for the Council to do so in light of this new information.
26. In my view, the Council was incorrect to say that it “cannot” complete a further financial assessment. This amounted to the Council fettering its discretion in the matter. This was fault.

Agreed action

27. Within two months of my final decision statement, the Council will:

• Complete a further financial assessment for Mrs G to recalculate her care contributions, taking into account the new information provided by Mr T.

28. If the assessment determines that Mrs G should have paid less towards her care, the Council will reimburse her estate accordingly.

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Final decision

29. The evidence suggests the Council fettered the discretion granted to it under the Care Act 2014 in declining to carry out a financial reassessment for Mrs G. This was fault.
30. In my view, the action the Council has agreed to take represents a reasonable and proportionate remedy for the injustice arising from this fault.
31. I have now completed my investigation on this basis.

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Investigator's decision on behalf of the Ombudsman