Summary: Mr and Mrs X complained on behalf their son, Mr F, about the Council’s handling and administration of his direct payments. The Council was not at fault for how it decided to ask for evidence of expenditure to make a back payment of funds for the period June 2016 and July 2017. It was also not at fault for its decision to ask for repayment of £7775 for expenditure outside the direct payment agreement, or for restricting how Mr and Mrs X can use the funds. The Council was at fault for failing to refer Mr F to its support services after it agreed to do so in January 2018. The Council agreed to apologise to Mr and Mrs X and Mr F for the uncertainty this caused. It also agreed to contact Mr and Mrs X to ensure Mr F is receiving the appropriate support from services in line with his needs.

The complaint

1. Mr and Mrs X complained on behalf of their son, Mr F via their solicitor. Mr and Mrs X complain about the Council’s handling and administration of Mr F’s direct payments between 2016 and 2019. In particular Mr and Mrs X complain the Council:
• Agreed to increase Mr F’s direct payments in June 2016 but failed to do so.
• Decided to maintain Mr F’s direct payments at the level prior to June 2016 at a panel review in July 2017.
• Has asked for unreasonable evidence of expenditure to backdate Mr F’s direct payments for the period June 2016 to July 2017.
• Failed to refer Mr F to its Occupational Therapy (OT), Speech and Language Therapist (SALT) and physiotherapy services after it agreed to do so in January 2018.
• Has required Mr and Mrs X to repay £7775 for purchases made using Mr F’s direct payments which it says are in breach of Mr F’s direct payment agreement.
• Has put unnecessary restrictions on how Mr F can spend his direct payments.
• Is insisting Mr F’s direct payments are moved onto a managed payroll system.
2. Mr and Mrs X said the handling of Mr F’s direct payments has caused them financial loss, distress, uncertainty and time and trouble.

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What I have investigated

3. I have investigated complaint elements 3-7. I have not investigated events around complaints 1 and 2 for the reasons explained in paragraph 34 and 45.

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The Ombudsman’s role and powers

4. 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)
5. We cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, 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)

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How I considered this complaint

7. I considered the information provided by Mr and Mrs X’s solicitor.
8. I considered the Council’s response to my enquiry letter.
9. I considered relevant law and guidance including the Care Act 2014, the Care and Support statutory guidance, and Council policy and guidance.
10. Mr and Mrs X and the Council had the opportunity to comment on my draft decision. I considered their comments before making a final decision.

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What I found

Direct Payments

11. 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 care and support plan.
12. 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)
13. Direct payments are cash payments made to individuals who ask for one to meet some or all of their eligible care and support needs. They provide independence, choice and control by enabling people to commission their own care and support to meet their eligible needs. The council has a key role in ensuring that people have relevant and timely information about direct payments so they can decide whether to request them. If they do so, the council should support them to use and manage the payment properly.
14. The Guidance says the council must be satisfied that the direct payment is being used to meet the care and support needs set out in the plan, and should therefore have systems in place to proportionally monitor direct payment usage to ensure effective use of public money.

The Council’s direct payment policy

15. The Council’s policy says direct payments can only be used for support which meets the outcomes agreed in the care and support plan. The policy gives examples which include employing a personal assistant, buying care services, respite care and necessary equipment in line with the support plan.
16. The policy also refers to what direct payments cannot be used for. This includes paying household bills or other personal expenses, employing family members, and anything that should be provided by the NHS or the Council. The policy says customers should refer to the Council before purchasing items or goods not listed in the support plan. It says the Council may reclaim funds used for purchases of goods and services outside of the support plan.
17. The Council’s policy says all recipients of direct payments must keep appropriate records for six years and along with routine monitoring they may be asked to submit additional information from time to time.
18. The policy contains information on what action the Council may take if it identifies mismanagement or misuse of direct payments. The policy says the Council will review concerns identified and agree appropriate actions going forward. Where it is clear spending of direct payments is not line with the agreed support plan, it will reclaim those funds. The policy says the Council will consider future management of direct payments which may involve transferring the account to a managed payroll service.

What happened

Background

19. Mr and Mrs X have an adult son, Mr F who has autism and learning difficulties. Mrs X is Mr F’s main carer and she is also his appointed deputy for finance, property and for health and welfare.
20. Mr F has received direct payments since 2011. At the time Mrs X signed Mr F’s direct payment agreement with the Council. The agreement states direct payments should only be used to achieve the outcomes from a needs assessment and not for general living expenses. The agreement says the Council will monitor the use of the direct payments. It says Mr F may be required to return payments to the Council if the money is used for purposes other than to achieve agreed social care outcomes.
21. In June 2016, the Council’s social care panel met to discuss Mr and Mrs X’s request for a higher level of weekly funding for Mr F. The Council emailed Mr and Mrs X to say the increase was partly agreed by the panel. The Council agreed to increase Mr F’s direct payments from £1440.54 to £1839.15 per week. The email told Mr and Mrs X that the Council would not continue to fund some areas of expenditure including Mr F’s independent self-employed Speech and Language Therapy (SALT), Physiotherapy and ABA (Applied Behaviour Analysis) tutoring because they are health services. It also said it would not continue to fund one off expenditure such as Mr F’s iPad and drum kit unless discussed with his social worker or agreed at panel. The email further stated expenses such as meals, travel and entrance fees to events would not be funded by direct payments.
22. Mr and Mrs X disputed the level of f Mr F’s direct payments. They said the increase was insufficient to meet Mr F’s needs. The Council did not increase Mr F’s direct payments but continued to pay at the original direct payment amount of £1440.54 per week. The Council’s quality assurance panel reviewed Mr F’s direct payments again in July 2017. It decided to maintain F’s payments at £1440.54.
23. In August 2017 the Council wrote to Mrs X about Mr F’s direct payments. This letter reiterated some concerns about the use of the direct payments which were included in the email from June 2016. The letter reminded Mrs X of the agreement she signed in 2011 and said Mr F’s payments should only be used to meet his social care outcomes. The letter said despite the email sent to her in June 2016, Mr F’s direct payments had been used to pay for independent health services, one off expenditures and expenses for meals and travel. The Council issued Mr and Mrs X with an invoice for £7775 to reclaim purchases made outside of the direct payment agreement which Mr and Mrs X paid in full at the time. The Council said it would no longer transfer Mr F’s direct payments into his bank account. Instead it now required Mr and Mrs X to setup a managed payroll account to help them better manage the funds.

The complaint

24. Records show Mr and Mrs X started raising concerns about the Council’s handling of Mr F’s direct payments via their solicitor following the letter in August 2017. However, it was In October 2018 that Mr and Mrs X submitted a formal complaint. They complained:
• the Council failed to increase Mr F’s direct payments by £398 per week between June 2016 and July 2017 after the panel agreed to do so. Mr and Mrs X also complained about the panel’s decision in July 2017 to maintain Mr F’s funds at the original level.
• the Council was asking for evidence of expenditure in order to backdate payments for the period June 2016 to July 2017.
• they have used Mr F’s direct payments to pay for independent SALT, physio and ABA for several years and do not accept they fall into the bracket of health services. They said the Council had failed to arrange referrals for Mr F to use its in house services after it agreed to do so in January 2018.
• about the Council’s monitoring of Mr F’s use of his direct payments. Mr and Mrs X said the demand for repayment of £7775 of purchases made using Mr F’s direct payments was unfair. They specifically referenced purchases of international flights to a religious music event, an electronic drum kit and funding for a specialist ABA tutor. They said the purchases met F’s eligible needs in line with his Care Act needs assessment.
• about the Council’s requirement that Mr F’s direct payments be administered using a managed payroll. Mr and Mrs X said this expectation was inappropriate.
25. Mr and Mrs X said they did not accept the level of monitoring proposed by the Council and said they did not act outside the direct payment agreement in how they spent the funds.
26. Due to the complexity of the complaints the Council appointed an independent investigator to deal with the complaint. The investigator met with Mr and Mrs X and their solicitor in November 2018 to clarify the matters complained about.

The Council’s independent investigation

27. The Council completed its independent investigation in March 2019. The investigator found clear evidence that the Council agreed to increase Mr F’s direct payments in June 2016, but the increase was never applied. However, the investigator found it was appropriate for the Council to ask for evidence of how that money was spent before backdating the payment.
28. The investigator found the Council had agreed to refer Mr F to local OT, SALT and physiotherapy in January 2018, to assist with him transitioning to home from college. However new assessments were not agreed. The investigator partially upheld this complaint and found the Council delayed referring Mr F to these therapies. The investigator did however note evidence from Mrs X who felt further assessments were not required or appropriate.
29. The investigator found the Council had acted in line with relevant law and guidance in requiring Mr and Mrs X to repay the sum of £7775. They said there was ample evidence that Mr and Mrs X were given clear guidance on what was acceptable use of direct payments.
30. The investigator found the Council was entitled to require Mr and Mrs X to administer Mr F’s direct payments on a managed payroll system and to pay anyone providing Mr F with services in line with relevant legislation. The investigator found this decision was in line with its own policy. It said the Council had a duty to ensure public money was used correctly. The investigator did however find the Council historically had not provided sufficient care and support to help Mr and Mrs X manage Mr F’s direct payments.
31. The Council wrote to Mr and Mrs X with the outcome of their complaint in April 2019. The Council agreed with the findings of the independent investigator. The Council agreed to several recommendations following the investigator’s report. This included revising its direct payment policy and apologising to Mr and Mrs X for failing historically to provide support in managing Mr F’s direct payments.
32. The Council wrote to Mr and Mrs X in September 2019 and apologised for the lack of support and attention it had given them in understanding the direct payments process. The Council said it was continuing to maintain contact with Mr and Mrs X to develop a support plan for Mr F and supporting the direct payments process.

Complaint to the Ombudsman

33. Mr and Mrs X remained unhappy with the Council’s findings and complained to the Ombudsman via their solicitor.

My findings

34. Mr and Mrs X remained unhappy with the complaint elements listed in paragraph 1. I have not investigated the Council’s decision making when it decided to increase F’s direct payment in 2016 by £398 per week, nor the Council’s decision in July 2017 to reverse that decision and maintain the funds at the original level (points 1 and 2 at paragraph 1). This is because those complaints are late, and it was reasonable for Mr and Mrs X to complain to us about this much earlier.

The Council is asking for unreasonable evidence of expenditure to backdate F’s agreed increase in direct payments between 2016 and 2017.

35. The records show the Council agreed to an increase of £398 per week in Mr F’s direct payments in June 2016, which was reversed at panel in July 2017. The records show Mr F never received that increase. The Council has agreed to backdate that payment for the period June 2016 to July 2017 if Mr and Mrs X provide evidence to show they have used the £398 each week to meet Mr F’s eligible needs.
36. The Council’s direct payment policy states individuals should keep records of all income and expenditure along with supporting documentation for a period of six years. It says submission of this information for monitoring purposes is a key element of the direct payment agreement. The statutory guidance says the Council must be satisfied that the direct payment is being used to meet care and support needs as set out in the plan. If Mr and Mrs X believed they would receive the payment, in line with the policy, Mr and Mrs X should have kept records of all expenditure of Mr F’s direct payments. If they were unclear, they would receive it, I would have expected them to keep evidence of expenditure to justify a future increase in the direct payment. The Council must ensure public money is used appropriately. There is no fault in the Council requesting proof of expenditure to support the back dated payment.

Failed to refer Mr F to its Occupational Therapy (OT), Speech and Language Therapist (SALT) and physiotherapy services after it agreed to do so in January 2018.

37. The records show that prior to January 2018 Mr F lived away from the family home. The Council were involved in supporting and preparing Mr F’s for his transition back to the family home and agreed in January 2018 to refer Mr F to its services who provide OT, SALT and physiotherapy. The records show Mr F did not require any new assessments as his needs were already well documented on previous assessments.
38. The records show the Council failed to refer Mr F to the relevant services in January 2018 and failed to have any further oversight or input on the matter until June 2018. That was fault and this caused both Mr F and Mr and Mrs X uncertainty in preparation for Mr F’s transition back to the family home. Mr and Mrs X’s representative says there are still outstanding referrals.

How Mr and Mrs X used F’s direct payments

39. The independent investigator found the Council had historically failed to provide appropriate support to Mr and Mrs X in managing Mr F’s direct payments. However, records show it wrote to Mr and Mrs X in 2016 explaining its policy and explaining what could and could not be purchased using direct payments. The Council only required repayment for items purchased after this correspondence which totaled £7775. This included flights, an electronic drum kit, taxis, iTunes vouchers, and specialist ABA tuition which it decided were not in line with Mr F’s support plan. The Council clearly explained what expenditure it considered inappropriate and that for expenditure on any items not included in Mr F’s support plan Mr and Mrs X should refer to the Council before using the funds. The Council has acted in line with its policy and it is not at fault for deciding to recover the money.
40. Mr and Mrs X say the Council is acting outside relevant law and guidance in restricting how they can use Mr F’s direct payments. They say the whole purpose of direct payments is to give recipients independence, flexibility and choice. Mr and Mrs X have referred to specific purchases such as flights to a music festival, an electronic drum kit and specialist ABA tuition. They consider these purchases meet Mr F’s eligible care needs for participation in recreation and for social wellbeing. However, these items are not specified in Mr F’s care and support plan.
41. While it is true that direct payments allow for independence and flexibility, the Council must be satisfied that people spend the payments on meeting care and support needs as set out in the care and support plan. It does not mean recipients can spend direct payments on whatever they choose. The Council decided purchases such as flights, the drum kit and specialist ABA tuition were not an appropriate use of direct payments to meet Mr F’s eligible needs. The Council has considered statutory guidance and its own guidance. It is not at fault.

Requirement for Mr and Mrs X to use a managed payroll system for Mr F’s direct payments

42. Relevant guidance allows Councils to have systems in place to monitor usage of direct payments. The Council’s policy gives it discretion to transfer the management of payments onto a payroll system where it has concerns about the use of direct payments. The Council must ensure public funds are spent appropriately. The Council had ongoing concerns about unauthorised spending of Mr F’s direct payments as outlined above. It was also not satisfied that they were employing people in line with relevant legislation.
43. It is for the Council to decide what action to take if it considers Mr and Mrs X are not using Mr F’s direct payments appropriately. The Council has acted in line with relevant guidance and policy. There is no fault in its decision to require Mr and Mrs X to use a managed payroll system. The evidence shows it has offered them the appropriate support to do this.

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Agreed action

44. The Council agreed within one month of the final decision to:
• write to Mr and Mrs X and Mr F and apologise for the uncertainty caused to them by failing to refer Mr F to its OT, SALT and physiotherapy services after agreeing to do so in January 2018.
• Contact Mr and Mrs X to discuss whether Mr F is receiving the appropriate support which meet his needs in the areas of OT, SALT and physiotherapy. The Council should then write to Mr and Mrs X and confirm whether Mr F requires referring to any of its support services or whether there are any outstanding referrals.

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Final decision

45. I have completed my investigation. I have found some fault and the Council agreed to my recommendations to remedy the injustice caused by that fault.

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Parts of the complaint that I did not investigate

46. I did not investigate Mr and Mrs X’s complaints about the Council’s decision making in 2016 and 2017 regarding increases to F’s weekly direct payment. This is because the complaint is late and I consider it was reasonable for Mr and Mrs X to have complained much earlier.

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Investigator's decision on behalf of the Ombudsman