Summary: Mr X complained the Council has incorrectly decided Mrs Z deprived herself of assets. Mr X says this has caused Mrs Z to incur care home costs she should not have had to pay. The Council has accepted it failed to consider all the criteria for deprivation of assets. The Council has changed, and backdated, its decision on Mrs Z’s deprivation of assets and apologised to Mrs Z. The Ombudsman considers the Council’s actions have remedied the fault. The Council also accepted the Ombudsman’s recommendation to pay Mrs Z £250 for the distress and inconvenience caused.

The complaint

1. Mr X complained the Council failed to consider all relevant expenses when it completed Mrs Z’s financial assessment. Mr X says this has resulted in the Council considering Mrs Z deprived herself of assets resulting in a notional capital amount with Mr X disputes.
2. Mr X says this has resulted in Mrs Z incurring care home costs which she would not have if the Council had accepted the full expenses.

Back to top

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. We may investigate complaints made on behalf of someone else if they have given their consent. (Local Government Act 1974, section 26A(1), as amended)
6. 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)

Back to top

How I considered this complaint

7. I have considered all the information Mr X provided. I have also asked the Council questions and requested information, and in turn have considered the Council’s response.
8. Mr X and the Council had opportunity to comment on my draft decision.

Back to top

What I found

Deprivation of assets

9. The charging rules for residential care are set out in the “Care and Support (Charging and Assessment of Resources) Regulations 2014” (the regulations), and the “Care and Support Statutory Guidance 2014” (CSSG). When the Council arranges a care home placement, it must follow these rules when completing a financial assessment to decide how much a person must pay towards the costs of their residential care.
10. The rules state that people who have over the upper capital limit, £23,250, should 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.
11. Regulation 22 says councils must treat people as still having capital they have deprived themselves of for the purpose of reducing the amount they need to contribute to the costs of their care. Capital treated this way is often called ‘notional capital’.
12. However, the CSSG says councils should not automatically assume deprivation. It says there may be valid reasons someone no longer has an asset and councils should ensure they fully explore this first.
13. The CSSG says that when deciding if someone has deprived themselves of assets, councils should consider:
1. whether avoiding the care and support charge was a significant motivation in the timing of the disposal of the asset; and
2. whether the person had a reasonable expectation of needing to contribute to the cost of their eligible care needs.

What happened

14. In 2017, Mrs Z lived in her own home but was looking at selling her home and moving into a care home. By March 2018, Mrs Z was living in a care home.
15. In September 2019, Mrs Z applied to the Council for financial assistance for the cost of her care home.
16. On 10 December 2020, Mr X contacted the Council to advise a friend of Mrs Z’s passed away in June 2019 and left money for Mrs Z. Mr X said Mrs Z received this money and would pay this into her bank account increasing her assets to £32,862.19. Mr X asked how this would affect Mrs Z’s entitlement to financial assistance from the Council.
17. The Council wrote to Mrs Z on 11 December 2020 to advise Mrs Z was not entitled to financial assistance from the Council as her capital was more than the £23,250 threshold. The Council also advised it considered Mrs Z had deprived herself of assets to reduce the cost of her care and support because:
• Mrs Z transferred shares into someone else’s name in March 2018. The Council said Mrs Z was living in a care home and knew she needed care and support.
• Mrs Z promised Mr X £10,000 on 22 July 2017 to help with selling her home and finding a care home. The Council said the nature of this promise showed Mrs Z was aware she needed care and support. The Council said these funds remained in Mrs Z’s account until October 2019, a month after she sought financial assistance from the Council. The Council said Mrs Z knew she needed care and support and knew she needed to contribute towards this care and support when she gave the funds away.
• Mrs Z gave away sums of £5,000, £2,000 and £2,421.26 (totalling £9,241.26) a few days before Mrs Z entered the care home. The Council said Mrs Z knew she needed care and support when she gave away these funds. The Council said Mr X had explained Mrs Z used this money towards her care, for presents and gifts. The Council asked for receipts to prove this so it could reconsider its position.
• Mrs Z paid £3,000 for a funeral bond while Mrs Z was in a care home and Mrs Z knew she was responsible for the full cost of her care home fees.
18. The Council said Mrs Z’s notional capital was £22,421.26.
19. On 16 December 2020, the Council wrote to Mrs Z to explain that she could apply for financial assistance again once her capital reduced below the £23,250 threshold. The Council explained her capital included the notional capital of £22,421.26 from funds she had given away.
20. Mr X wrote to the Council on 3 February 2021 to appeal its decision about deprivation of assets. Mr X said:
• On 22 January 2021 he had repaid the £10,000 to Mrs Z made to him in October 2019.
• The person who received the shares had sold them totalling £218.49 and credited these funds to Mrs Z’s bank account.
• Mr X said the £9,241.26 was not deprivation of assets but genuine spending. Mr X provided receipts totalling £880.59 of miscellaneous expenses but advised he did not have receipts for most items because of the time passed.
• Mr X accepted the Council could consider the funeral bond notional capital.
21. The Council responded to Mr X’s appeal on 26 February 2021. The Council preserved its position that Mrs Z did not qualify for financial assistance. The Council said that since Mrs Z knew she needed care and support when she gave away money she had deprived herself of assets. The Council accepted the return of the £10,000 and the £880.59 in miscellaneous receipts. The Council said it now considered Mrs Z’s notional capital was £11,540.
22. Mr X disputed the Council’s position on the remaining notional capital on 24 May 2021. Mr X accepted the £3,000 funeral bond but disputed the remaining £8,540. Mr X said this £8,540 included a cost of £2,817.64 in a Deputyship bill, £336 for a glass door panel replacement and Mrs Z had received return of the shares sale funds at £218.49. Mr X asked the Council to reconsider its position on these funds. Mr X also said he did not consider Mrs Z deliberately deprived herself of the assets to reduce care charges. Mr X confirmed with the Council Mrs Z’s current financial situation was £35,000.94 which still put her above the £23,250 threshold.
23. On 8 July 2021, the Council provided its final response to Mr X. The Council advised it had already disregarded the £2,817.64 and £336 Mr X had detailed and had never considered this notional capital. The Council said it had now removed the repaid shares of £218.49 reducing the notional capital to £11,322.38. The Council directed Mr X to the Local Government and Social Care Ombudsman (the Ombudsman).
24. Mr X complained to the Ombudsman and on 16 November 2021 the Ombudsman made enquiries of the Council. The Ombudsman asked the Council for an explanation of why it considered avoiding care charges was a significant motive in Mrs Z disposing of assets.
25. The Council told the Ombudsman it had failed to consider Mrs Z’s motive in disposing of the assets and had reconsidered its position on her notional capital. The Council wrote to Mrs Z on 10 January 2022. The Council apologised for its error and said:
• It had now decided it should not consider £8,322.38 as notional capital and had changed its previous decision.
• It had backdated the removal of £8,322.38 as notional capital to the date of the financial assessment.
• Because of its removal of £8,322.38 as notional capital, Mrs Z would have been entitled to financial assistance from 1 September 2021 as her capital reduced below the £23,250 threshold.
• It would backdate financial assistance from 1 September 2021 and detailed Mrs Z’s financial contributions towards her care home from this date.

Analysis

26. Mr X complained the Council incorrectly decided Mrs Z deprived herself of assets. Mr X’s dispute related to the £8,322.38 funds the Council said was notional capital until January 2022.
27. The CSSG sets out two criteria a Council must consider to decide a person has deprived themselves of assets.
28. One criteria is that a person must have a reasonable expectation they need care and support and they would need to contribute to the costs of this.
29. I am satisfied the Council properly considered this criteria outlined in the CSSG. On each assessment of Mrs Z’s finances and consideration of any deprivation of assets, the Council asked whether Mrs Z had reasonable expectation that she would need care and support. On each instance, the Council outlined that Mrs Z was either just about to enter, or was already in, a care home. Because of this, the Council justified that Mrs Z should have an expectation of needing care and support and needing to contribute to this.
30. There is no fault in how the Council considered this criteria in deciding Mrs Z deprived herself of assets.
31. The other criteria is whether a person has deprived themselves of assets with the significant motivation of avoiding or reducing care charges.
32. Just because, by disposing of an asset, someone needs to contribute less to their care, this is not enough to decide they have intentionally deprived themselves of the asset. The CSSG is clear there may be valid reasons someone no longer has an asset and councils should not automatically assume deprivation.
33. To properly decide whether someone had deprived themselves of an asset councils must show, based on evidence, that a significant motivation in the decision to dispose of the asset was to reduce their contribution to their care costs.
34. The Council has admitted in its contact with the Ombudsman, and in the letter to Mrs Z on 10 January 2022, that it failed to consider this criteria. The Council has accepted it was at fault for assuming deprivation of assets without satisfying itself that Mrs Z had a significant motivation or intention to avoid care costs. The Ombudsman agrees this was fault.
35. The Council has corrected its fault on 10 January 2022 by reversing its decision the £8,322.38 of funds was a deprivation of assets. The Council backdated this decision to the date of the financial assessment on 11 December 2020. I am satisfied the Council’s actions have corrected this fault.
36. While the Council has now corrected its fault, Mrs Z has experienced an injustice from the Council’s actions. Mrs Z has paid for her full care home fees during her time in the care home. Mrs Z has also experienced distress and frustration through disputes with the Council over the deprivation of assets from December 2020 to July 2021.
37. The Council’s fault did not cause Mrs Z and injustice with her care home fees until 1 September 2021. Until this date, Mrs Z’s assets remained above the £23,250 threshold, even if the disputed £8,322.38 was not considered notional capital. This means Mrs Z would have needed to pay for her care home costs until this point regardless of the Council’s decision on her deprivation of assets.
38. From 1 September 2021, Mrs Z’s assets reduced below £23,250 when the £8,322.38 is not considered notional capital. Had the Council made its deprivation of assets decision without fault, the Council would have been contributing towards Mrs Z’s care home fees from 1 September 2021.
39. Since the Council has backdated its decision to 11 December 2020 and backdated Mrs Z’s financial support to 1 September 2021, the Council’s actions have corrected the overpayments Mrs Z has paid. But Mrs Z has paid for the full cost of her care for slightly over four months when the Council should have been contributing to these care costs. This has caused Mrs Z an added financial burden.
40. Mr X, on behalf of Mrs Z, has appealed the Council’s decision twice and spent time compiling receipts for the Council to prove no deprivation of assets. Mr X and Mrs Z have also experienced distress at not being able to provide receipts for certain expenses causing the Council to decide it was a deprivation of assets. Mr X, and Mrs Z, would have avoided this distress if not for the Council’s fault.

Back to top

Agreed action

41. Within one month of the Ombudsman’s final decision the Council will:
• Pay Mrs Z £250 for the distress, inconvenience and added financial burden caused through the fault in consideration of her deprivation of assets and the four-month delay in providing financial support caused by this error.

Back to top

Final decision

42. There was fault by the Council as the Council has agreed to my recommendation I have completed my investigation.

Back to top

Investigator's decision on behalf of the Ombudsman