Summary: Mr X complains that the Council did not tell Mr P that his direct payment account was in arrears, and arrears were building up over years. Mr X says this caused Mr P unnecessary distress. We find the Council at fault, and this fault caused Mr P and Mr X injustice. The Council has agreed to apologise, make payments to Mr P and Mr X, and improve its service so this does not happen to anyone else in future.

The complaint

1. Mr X complained on behalf of Mr P, the complainant, that the Council is seeking to recover direct payment arrears dating back to 2012. Mr X said the Council did not contact Mr P about the arrears until September 2020. Mr X said the Council has taken no responsibility for failing to contact Mr P about the arrears, which are now significant.
2. Mr X said Mr P is now being asked to pay £8000. He said this caused unnecessary distress to Mr P, who is a vulnerable adult.

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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 an injustice, 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)
5. We may investigate a complaint on behalf of someone who cannot authorise someone to act for them. The complaint may be made by:

• their personal representative (if they have one), or
• someone we consider to be suitable.

(Local Government Act 1974, section 26A(2), as amended)

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How I considered this complaint

6. Mr P has learning difficulties that mean he lacks capacity to make certain decisions for himself. Mr X’s organisation provides Mr P’s care and acts as an appointee for Mr P. For this reason, I find that Mr X is a suitable person to represent the complaint on Mr P’s behalf.
7. I considered the information and documents provided by Mr X and the Council. I spoke to Mr X about the complaint. Mr X and the Council had an opportunity to comment on an earlier draft of this statement. I considered all comments received before I reached a final decision.
8. I considered the relevant legislation and statutory guidance, set out below. I also considered the Ombudsman’s published guidance on remedies.

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What I found

What should have happened

9. Councils can charge for care and support services they provide or arrange. Charges may only cover the cost the council incurs. (Care Act 2014, section 14)
10. Direct payments are monetary payments made to people 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.
11. The council has a key role in ensuring that people have relevant and timely information about direct payments so they can decide whether they want direct payments. If they do, the council should support them to use and manage direct payments properly.
12. The council is ultimately responsible for meeting the person’s care needs. The council is also ultimately responsible for making sure the person knows what their financial contribution is towards their care, and that payments are correctly made. The council should be auditing direct payment accounts at least annually.

What happened

13. Mr P has care needs which are met through support provided by Mr X’s organisation. The organisation is also Mr P’s appointee as he lacks capacity to make certain decisions for himself. The Council pays Mr P’s direct payments to the broker, and the broker pays Mr X’s organisation for Mr P’s care. Mr P makes financial contributions to his care. He pays weekly amounts directly to the broker.
14. Each year, the Council sent Mr P a letter saying how much his weekly amounts would be. Mr X’s organisation was responsible for making sure Mr P paid the right amount to the broker.
15. Mr P was meant to start paying weekly contributions in September 2012. He actually began paying in 2013.
16. The broker told the Council in 2014 it believed it had “tackled” unpaid contributions and had a plan in place for each person that was behind in their payments.
17. The Council told the broker outcomes of audits and that the broker needed to take action about arrears: twice in 2014; in 2016; and in 2017.
18. Mr X’s organisation called the Council in June 2018. The Council told the organisation Mr P had not been paying the right amount, and that he was in arrears.
19. The next month, the Council wrote to the broker about its audit. The Council said the broker needed to take action about Mr P’s arrears.
20. The Council wrote a similar letter to the broker in September 2020. At the same time, the Council wrote to Mr P to inform him he was in arrears of over £8000.
21. Mr X complained to the Council on behalf of Mr P.
22. The Council’s complaint response said it had sent letters when Mr P’s weekly amount changed, but his payments had not changed to reflect the increased amounts. It said it was weeks, sometimes months, before payment amounts were changed.
23. The Council said it was not its responsibility to check whether the person had increased their contribution payment amount. It said it regularly sent letters to the broker showing the amount owed and saying action needed to be taken about the arrears. The Council accepted that the broker may not have passed this information on to Mr P or Mr X’s organisation.
24. The Council said it had made all reasonable efforts over the last several years to remind the broker, and recently Mr X’s organisation, of arrears. It said it was for Mr X’s organisation to take up with the broker directly.
25. Mr X then brought the complaint to the Ombudsman.

Analysis

26. Between 2012 and 2020, Mr P did not pay the correct amount every week. For at least three years, Mr P paid significantly lower payments than he should have been. All-in-all, this has led to a significant amount of arrears building up.
27. Mr X accepts that his organisation is at fault for not making sure Mr P made the correct payments at the correct time. However, he says the Council did not tell him or Mr P that Mr P was in arrears and that these arrears were building up.
28. The Council says the broker is to blame. The Council says that because Mr P’s direct payments are paid directly to the broker, the broker is responsible for ensuring Mr P’s contributions are paid in a timely manner and for the correct amounts. The Council says it would have reasonably expected the broker to tell Mr P or Mr X’s organisation about the arrears.
29. The Council says it did not tell Mr P or Mr X’s organisation about the arrears because it told the broker directly.
30. As I have said above, it is ultimately the Council’s responsibility to make sure that payments are correctly made. It did not do this.
31. Also, as I have said above, the Council should have been auditing Mr P’s direct payment account at least annually. There is evidence that the Council audited Mr P’s account. The outcome of these audits was that the Council told the broker about Mr P’s arrears. There is no evidence the Council told Mr P he was in arrears until September 2020.
32. I find the Council failed to provide adequate information to Mr P about his payments by failing to inform him he was in arrears. This is fault. When people have direct payments, councils should support them to use and manage the payment properly. There is no evidence that the Council did this.
33. I also find the Council failed to keep a proper audit of Mr P’s account over the years. While the Council audited the account, there is no evidence that the Council told Mr P directly the outcome of these audits or what needed to be done to repay the arrears. This is fault.
34. However, I find the arrears are rightly due for the care Mr P received.
35. I find the fault caused Mr P injustice because of the unnecessary distress this has caused. I also find the fault caused Mr X injustice in that he went to considerable time and trouble in communicating with the Council about this.
36. I note there is evidence of a phone call between the Council and Mr X’s organisation in 2018 where the Council said Mr P was in arrears. However, this is not sufficient for me to find that the Council properly told Mr P directly of these arrears.

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Agreed action

37. Within four weeks of this decision, the Council has agreed to apologise to Mr P in writing for the unnecessary distress (injustice) caused by the fault.
38. Within four weeks of this decision, the Council has agreed to make a payment to Mr P of £400 to reflect the distress caused by the fault. This should be offset against Mr P’s arrears.
39. Within four weeks of this decision, the Council has agreed to make a payment to Mr X of £200 to reflect his time and trouble (injustice).
40. Within four weeks of this decision, the Council has agreed to discuss and agree with Mr X a reasonable repayment plan for Mr P to repay the arrears.
41. Within three months of this decision, the Council has agreed to review its policy on direct payments to make sure the person is notified directly, in writing, of arrears on their direct payment account so that action can be taken.
42. Within three months of this decision, the Council has agreed to review its policy on auditing direct payment accounts to make sure accounts are properly audited at least annually (including telling the person in writing if they are in arrears), and to make sure the Council takes action itself about arrears rather than allowing them to build up.
43. Within three months of this decision, the Council has agreed to share this decision with appropriate managers and within appropriate team meetings so that the learning here is shared amongst staff.
44. I have considered the amounts of these payments having due regard to the Ombudsman’s published guidance on remedies.
45. The Ombudsman will need to see evidence that these actions have been completed.

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Final decision

46. I have completed my investigation. I find the Council at fault for failing to tell Mr P that his direct payment account was building up arrears. This caused injustice. The Council has agreed to take action to remedy the injustice and prevent it happening to anyone else in future.

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Investigator's decision on behalf of the Ombudsman