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Gateshead Metropolitan Borough Council (19 005 282)

Category : Adult care services > Direct payments

Decision : Not upheld

Decision date : 23 Mar 2021

The Ombudsman's final decision:

Summary: There is no fault in the way the Council calculated Ms X’s contributions towards her care. It has given her ample opportunity to provide the evidence requested for a review. There is no fault in the way the Council administered Ms X’s carer’s pension contributions. The evidence shows Ms X’s carer did not contact the pensions body at the right time to opt out of contributions: once she did so, the situation was resolved.

The complaint

  1. Ms X says the Council is not paying for the full cost of her care. Ms X says she is expected to make a financial contribution towards the cost of her carer but she should not have to due to her financial circumstances. Ms X says as a result she is unable to pay her carer in full.
  2. Ms X says the Council also mismanaged her carer’s pension contributions. She says her carer opted out of the workplace pension scheme but the Council later deducted pension contributions in a lump sum.
  3. Ms X says the Council’s actions have put a strain on her relationship with her carer and have caused her time and trouble and distress.

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The Ombudsman’s role and powers

  1. We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word ‘fault’ to refer to these. 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)
  2. 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

  1. I have considered the information Ms X provided to the Ombudsman in her complaint. I have spoken to Ms X. I have also considered the Council’s response to her complaint and information it has provided to the Ombudsman.
  2. Ms X and the Council both had an opportunity to comment on my earlier draft decision. I considered their comments before making a final decision.

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What I found

Relevant law and guidance

  1. Councils must assess a person’s finances to decide what contribution he or she should make to a personal budget for care. The scheme must comply with the principles in law and guidance, including that charges should not reduce a person’s income below Income Support plus 25%. If a person incurs expenses directly related to any disability he or she has, the Council should take that into account when assessing his or her finances. (Care Act 2014 Department for Health, ‘Fairer Charging Guidance’ 2013, and ‘Fairer Contributions Guidance’ 2010)
  2. Everyone whose needs the local authority meets must receive a personal budget as part of the care and support plan. The personal budget gives the person clear information about the money allocated to meet the needs identified in the assessment and recorded in the plan. The council should share an indicative amount with the person, and anybody else involved, at the start of care and support planning, with the final amount of the personal budget confirmed through this process. The detail of how the person will use their personal budget will be in the care and support plan. The personal budget must always be an amount enough to meet the person’s care and support needs.
  3. There are three main ways in which a personal budget can be administered:

As a managed account held by the local authority with support provided in line with the person’s wishes;

As a managed account held by a third party (often called an individual service fund or ISF) with support provided in line with the person’s wishes;

As a direct payment. (Care and Support Statutory Guidance 2014)

What happened

  1. Ms X moved to the Council’s area in 2017. She was receiving care in the area she previously lived in and said she had to contribute less than £2 per week.
  2. The Council assessed Ms X’s financial circumstances when she moved to its area in 2017. It said she should contribute £70 per week towards her care and advised her she could ask it for a review of its decision if she was unhappy. Ms X signed the care and support plan which included the budget for her care.
  3. Ms X signed a Direct Payment agreement which says the Council can require information from her relevant to the management of the Direct Payment. The Direct Payment agreement says, ‘You will be responsible for all employment duties and rights such as tax, national insurance, holiday pay, health and safety of staff and training.’ It also says, ‘at any time the Council may ask to carry out an audit of your paperwork relevant to the management of your Direct Payment’.
  4. The Council carried out a further assessment of Ms X’s finances in 2018. Following this review the Council said she should only have to pay £59 towards her care. This was backdated by two months. The Council explained to Ms X she could ask for a review of its decision if she was unhappy.
  5. Ms X and her carer contacted the Council in November 2018 to say the carer did not wish to be part of the workforce pension scheme. On 12 November 2018 the Council confirmed with Ms X and her carer that the carer did not wish to be enrolled on the pension scheme and a Council officer advised they would “request this is processed”.
  6. On 2 April 2019 Ms X and her carer contacted the Council because five months of backdated pension contributions had been deducted from the carer’s wages. The Council said the carer “had not opted out” of the pension scheme.
  7. The Council says that following a meeting with Ms X and her carer on 4 April, the Council’s position on the carer’s enrolment into the pension scheme was set out in a letter to Ms X on 5 April.
  8. The carer then contacted the pensions body to opt out. The Council received confirmation from the pensions body on 12 April and the information was sent to the payroll provider. The Council refunded the monies already deducted and a further amount, as it had been too late to stop the April pay deduction, was refunded separately.

The complaint

  1. Ms X complained to the Council in 2019 about the contribution she was assessed as making towards the cost of care (particularly as she said the Council had not properly considered her disability-related expenditure), the failure of the council to meet the full cost of her carer’s wages and the attitude of the Direct Payments team towards her.
  2. The Council responded to her complaint in December 2019. It said it was clear Ms X had had “extensive and regular” contact with the Direct Payments team since 2017 and the team had regularly informed her how to appeal against her financial assessment and that it needed evidence of her expenditure and bank statements, which so far she had not provided. It said there had been meetings with Ms X and her carer where it had been explained she could appeal to the Council’s appeals committee if, after submitting her details for a review, it was not allowed. It reminded her that until she requested a review she was to pay the outstanding contributions.
  3. Ms X emailed the Council to say she had all the information it needed available, but no-one would make an appointment with her to view it. The Council responded that it needed to see the written information first and would then arrange a meeting if clarification was needed. It said there were concerns that Ms X had been asked to submit the evidence for a review since at least August 2018 and had not yet done so. It explained again it could only look at disability-related expenditure which was reasonably incurred over and above the standard amount it allowed for in its financial assessment.
  4. In 2020 the Council addressed concerns about Ms X’s management of her Direct Payments. It noted she had not paid her contribution since 2017 but the payments had continued to be made; it also noted she had not paid her carer in full. It said Ms X and her carer, who now also lived with Ms X, were said to be in a relationship. It noted both Ms X and her carer had suggested the care would cease if the Council did not pay Ms X’s carer in full but this had not happened.
  5. The Council said the Direct Payments had to be reviewed as it did not appear Ms X was keeping to the terms of the contract signed in 2017. Ms X said she did not want a commissioned service from the Council as an alternative but that was deemed to be a matter for her choice.
  6. In September 2020 the financial services manager wrote to Ms X after Ms X had discussed with her social worker a way forward to allow her to maintain her Direct Payments. The manager said for the payments to continue Ms X should provide all the documents (contracts, timesheets etc) she was required to have as an employer; she should repay the outstanding debt of her contributions; she should explain how she would repay to her carer the sums owed for the remainder of her wages; she should pay her contributions to the cost of her care from now on.
  7. The payments manager also said she understood Ms X was entering into an IVA (individual voluntary arrangement) to consolidate and pay off all her debt. She said if Ms X sought a debt relief order and was as a result unable to pay her carer, the Council would take the view she could not manage her direct payments. She said the carer had raised a grievance with the Council even though it was not her employer, but as the Council was now aware of the grievance Ms X should resolve the matter appropriately or it would take the view she could not manage her Direct Payments. Finally she said it was Ms X’s responsibility as she was in a relationship with her carer, to claim the appropriate benefit as a couple and let the Council know the outcome.
  8. Ms X says it was never properly explained to her when she started receiving Direct Payments that she would have to act an employer by keeping timesheets and so on: she says she was ill at the time and simply signed the Direct Payments agreement assuming it would be the same as the agreement she had previously had. She says she does not believe she had the same responsibilities as an employer in the area where she previously lived. She says the Council does not have a right to know details of her personal life.
  9. The Council has provided copies of the financial assessments which show how Ms X’s disability-related expenses have been taken into account. It has continued to pay Direct Payments until the way in which Ms X receives her care – perhaps through a commissioned service if she cannot manage her Direct Payments – is resolved.
  10. The Council says its current view is that “despite a significant level of support being provided over a long period by her social worker to support Ms X to put arrangements in place to manage the Direct Payment”, Ms X is not able to manage her Direct Payments. It says she is about to move into a more suitable properly and adds “the Council will agree a period of reablement looking to build on her strengths supported by her new surroundings. As part of the reablement plan, Ms X’s social worker and reablement colleagues will explore whether any reablement plan could be used to develop the skills needed to manage a Direct Payment. All such decisions are kept under review by the Council and could be revisited where there is evidence that Ms X can demonstrate the skills necessary to manage a Direct Payment at any point in the future.”


  1. Ms X was clearly provided with, and signed, the Direct Payments agreement at the start of the arrangements which explained her duties as an employer.
  2. The Council is not at fault in the way it handled Ms X’s carer’s pension contributions. The Council’s records show Ms X and her carer advised that the carer wished to opt out of the pension scheme. The Council explained how to do so but there was a delay on the part of the carer before this happened. The Council subsequently refunded the amounts deducted.
  3. The Council regularly advised Ms X of her right to request a review of its financial decisions and explained what evidence it needed to carry out that review. It was not fault on the part of the Council which led to a delay before Ms X submitted any evidence. The Council was under an obligation to ensure the Direct Payment was properly managed. I have seen no evidence the Council left Ms X in any doubt of her responsibilities and what she needed to do to continue to receive Direct Payments.
  4. The Council is looking at ways in which Direct Payments could be reintroduced at a future date.

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Final Decision

  1. I have now completed my investigation into this complaint. This is because:
    • There is no fault in the way the Council calculated Ms X’s contributions towards her care costs.
    • There is no fault in the way the Council has communicated with Ms X about the Direct Payments.
    • There is no fault in the way the Council administered contributions to Ms X’s carers pension.

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Investigator's decision on behalf of the Ombudsman

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