Summary: A care provider complained that the Council had failed to make payments due in respect of care and support it had delivered. There was fault by the Council. It failed to make payments on time and failed to resolve matters when the care provider complained to it. The Council has made improvements to its processes to stop this from recurring. The Council should resolve the outstanding invoices and make an interest payment to the care provider.

The complaint

1. The complainant is a care provider delivering care and support services to individuals placed with them by the Council. The care provider complained that the Council failed to pay the agreed care and support services when they invoiced it.
2. Mr B on behalf of the care provider says that at its most the Council owed the provider over £100,000. Mr B says this has caused significant cash flow issues and the care provider has incurred financial penalties. It also put the care at risk of termination.

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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 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)
4. 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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What I have and have not investigated

5. The law says we cannot normally investigate a complaint when someone could take the matter to court. However, we may decide to investigate if we consider it would be unreasonable to expect the person to go to court. (Local Government Act 1974, section 26(6)(c), as amended)
6. The care provider could have started court action to recover the money owed. However, I have investigated this complaint. This is because there was no legal dispute and the situation appears to be a matter of administration of the Council’s care planning and payments system; there were clearly long delays in the complaints process; the provider is a relatively small business; this situation was ongoing; and the Council had acknowledged fault and paid the majority of the outstanding amount by the time we were able to commence our investigation.

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How I considered this complaint

7. I considered evidence provided by the care provider and the Council.
8. Mr B (on behalf of the care provider) and the Council had an opportunity to comment on my draft decision. I considered any comments before making a final decision.

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What I found

What happened

9. Mr B complains on behalf of a care provider. It provides care for three individual service users for whom the Council is responsible. The care provider had delivered care and support services for one person for some years, but in 2024, the hours of care changed. Mr B agreed the new costings and hours with the Council’s social work team and submitted invoices for this.
10. The Council first did not pay the additional hours and then clawed back payments already made. Mr B queried this with the Council as all costings had been agreed in advance. He asked the Council to resolve this urgently but did not receive the full payment nor a proper reply.
11. The care provider also started working with two further service users, starting in February and April 2024 respectively. The Council did not pay Mr B the agreed costs for these two service users. Again, he chased the Council for payment and an explanation.
12. On 23 April, Mr B complained to the Council but it did not respond.
13. Mr B complained to the Ombudsman at the beginning of June. At that stage, he said the Council owed over £93,000.
14. Mr B says that as he has had to continue to pay staff and overheads, the missed payments from the Council have caused cash flow problems. It has also put those individual’s care at risk and if it had to stop care, it could cause the service users a great deal of distress.
15. We asked the Council to respond to Mr B. At that stage he said the Council owed the care provider £107,000. It wrote to him on 5 August. The Council apologised for the delay in dealing with his complaint and for not keeping him informed of progress. It had chased the relevant team within the Council in June. It had discovered that it had the incorrect care plans on the system and so had not paid the correct amounts. The correct payments for the two newer service users had been made on 15 and 24 July. It would make a further payment for the third service user on 7 August.
16. The Council said it had ensured it had a single point of contact for all financial queries so that in future, problems could be resolved more quickly. The Council did not tell Mr B how to escalate his complaint nor refer him to the Ombudsman.
17. Mr B said the Council still owed the care provider money. He emailed the Council on 5 August setting out the outstanding invoices showing that it would still owe £12,150 (even after the promised payment to be made that week).
18. The Council told Mr B he could ask the Council to consider his complaint at stage two of its procedure. We asked the Council to complete its stage two review. It responded to Mr B on 15 October. Again, the Council apologised for taking too long to deal with Mr B’s complaint. It explained that the delays in payment were due to dates on the care plans not matching the invoices, and the Council had since released a further payment of £1,369 with another payment of £4,387 due that week.
19. The Council again said it was updating its processes to make sure there was a single point of contact for financial queries. It acknowledged that although the financial payments required several teams to work together, this should not have meant that payments to Mr B were delayed. The Council also offered Mr B a symbolic payment of £150 to recognise that he was put to trouble pursuing matters. The Council told Mr B that he could take his complaint to the Ombudsman if he was not satisfied with the Council’s response.
20. Mr B has told us that although two of the three accounts were now up to date, a total of £7,088 was still owed in relation to the third service user. Mr B sent the Ombudsman and the Council details of the outstanding invoices. He also said that the offer of £150 did not seem proportionate when, had he started legal action, he could have been claimed interest on the outstanding amounts.
21. In response to our enquiries, the Council has clarified:
• It had not paid Mr B correctly and it still owed him money in relation to the third service user. It had arranged to pay him £5,582 owed and had made sure that the correct costs were now on its system so the underpayment would not continue.
• Mr B has included rent payments on the invoice and the service user’s benefit payments should cover this. The Council said it would speak with Mr B about this to make sure the service user is getting their full entitlement and support a discretionary housing payment if needed.
• It has established a dedicated unit to specialise in complex financial matters for adult social care payments. This unit also ensures that support plans are written to avoid errors with the financial aspect, there is a single point of contact for providers, and quicker escalation to senior management.
• It has introduced more robust procedures to ensure it monitors problems with payments and tracks unresolved queries, with senior management oversight.
22. I asked the Council what had gone wrong with these accounts. It said:
• It had to change the support hours for two of the service users. One due to an emergency placement, and another due to an emerging crisis where they were living.
• A third service user has a care package jointly funded with the health service and there were also different elements to the package. The Council and health service operate budgets separately. This service user’s costs also include an element of rent payment which needs further scrutiny as to how this should be funded.
• There was a financial uplift (increase in fees) that it should have applied automatically, but this did not happen.
• There were discrepancies between the dates on the care plans and the invoices.
23. Mr B has clarified that the rent element of the invoices was agreed with the Council. This was because it is a payment towards a room that would normally be occupied but Mr B had to keep empty to meet the needs of one of the service users.

Findings

24. The Council has acknowledged that it did not pay Mr B’s invoices on time. It took six months to apply the annual uplift, it did not honour the care costs it had agreed, and it did not communicate with Mr B properly nor resolve the outstanding issues.
25. The Council also failed to deal with Mr B’s complaints about this. It should have responded to his stage one complaint within four weeks. The Council took 15 weeks to reply. It failed to tell Mr B how he could escalate the complaint.
26. The Council should have responded to Mr B’s stage two complaint within two weeks. The Council took ten weeks to respond to this complaint. In addition to the delay, the Council missed opportunities to effectively review the accounts and resolve all the issues. The injustice was ongoing and so the ineffective complaint handling and the cumulative impact of a total of 25 weeks to complete the Council’s complaints process was significant.
27. The Council has paid most but not all of what is owed and it has made some improvements to its service so that the problem does not recur. However, the long delay has not only caused Mr B time and trouble, but it is likely that the care provider incurred financial costs as a result.
28. Mr B has asked the Council to pay the interest the care provider may have been awarded had he started court action to recover the unpaid money. I agree that given the amounts involved, an interest payment is appropriate. However, the Ombudsman is not best placed to decide on the amount. We are not the court, and it was open to the care provider to start court action if it wanted to recover that rate of interest. I have recommended that the Council liaise with Mr B to determine an appropriate rate of interest.

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Action

29. The Council will within one month of the date of this decision:
• Apologise to the care provider and Mr B. We publish guidance on remedies which sets out our expectations for how organisations should apologise effectively to remedy injustice. The organisation should consider this guidance in making the apology I have recommended in my findings.
• Resolve the rent element of the invoices and pay what is due.
• Make a symbolic payment to Mr B of £150 in recognition of the time and trouble he was put to by the Council’s poor complaint handling.
• Consult with Mr B and agree the rate of interest that it should pay on the overdue amounts.
30. The Council will make the interest payment within two months of the date of this decision.
31. The Council should provide us with evidence it has complied with the above actions.

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Decision

32. I find fault causing injustice. The Council has agreed actions to remedy injustice.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman