Summary: Ms C complains about the way the Council treated overpayments she made to her council tax account and dealt with her subsequent complaint. Ms C says the Council wrongly took recovery action which caused her upset and she spent unnecessary time and trouble in trying to resolve the matter. The Ombudsman has found fault by the Council in the way it responded to Ms C’s complaint and a missed opportunity to avoid further recovery action but considers the agreed actions including an apology, £200 and full explanation are enough to provide a suitable remedy.

The complaint

1. The complainant, whom I shall refer to as Ms C, complains about the way the Council has treated overpayments she made to her council tax account and dealt with her subsequent complaint. Ms C says the Council did not allocate her payments correctly which led to it wrongly taking recovery action.
2. Ms C says because of the Council’s fault she suffered upset from the recovery action and spent unnecessary time and trouble in trying to resolve the matter.

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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 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

5. I read the papers provided by Ms C and considered some information from the Council. I have provided a copy of this information to Ms C. I have explained my draft decision to Ms C and the Council and considered the comments received before reaching my final decision.

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What I found

6. The Council sent Ms C a bill dated 18 April 2018 for the new 2018/19 tax year. This bill also included a small amount outstanding from the previous 2017/18 year of £35.93. The bill set out the date and amount of each payment required. Ms C has explained the small amount related to a new build property she had moved to just before the end of March 2018.
7. The Council’s automatic cash allocation system would split each required payment between the current tax year and the small amount of arrears from the previous year.
8. However, Ms C slightly overpaid each month. The Council’s automated system could not make the required division between the two accounts and instead applied the whole of each payment to the current financial year.
9. The Council sent Ms C a reminder letter dated 25 July 2018 for £10.80 which was for the ‘missing’ small payments for the previous tax year. Ms C continued to make overpayments to her account which were applied to the current tax year.
10. The Council issued a summons letter dated 5 December 2018 for the full outstanding amount for the previous tax year of 2017/18 for £35.93. The Council has confirmed this is done through an automated process and the threshold for issuing a summons is £20 and above.
11. This is not fault by the Council. Councils’ computer systems will allocate payments according to some simple rules. Usually payments which are exactly equal to instalments or exact multiples of instalments will be allocated to the year's liability they match. If someone has both arrears and a current debt and pays a random sum of money the computer will not necessarily recognise which year(s) to allocate the payment to.
12. Ms C visited the Council on 11 December 2018 about her account and the Council’s recovery actions. The Council withdrew the summons.
13. The Council issued a further reminder letter to Ms C for £25.16 on 12 December 2018. The Council issued a further summons letter dated 8 January 2019 again for the full outstanding amount for the previous tax year 2017/18 for £35.93.
14. Ms C contacted the Council on 14 January 2019 using an online enquiry form. She stated she was making a formal complaint about receiving another summons despite her visit to the Council in December. The Council responded on 21 January to say it had put further recovery action on hold and confirmed the final two payments she needed to make and it would then withdraw the summons. There is no reference to the Council’s complaints procedure.
15. Ms C contacted the Council again on 25 January. The Council provided a detailed explanation to Ms C about her account and how it had allocated her payments on 11 February 2019. The Council accepted it should have manually moved any mis-allocated payments between the two financial years and reissued a new bill with lower instalments. This action would have avoided the further recovery action. This did not happen and the Council provided an apology. However, the Council said it would not withdraw the summons costs of £69.50 until Ms C had made the final payment for the 2018/19 tax year.
16. The Council’s response dated 11 February 2019 again made no reference to its complaints procedure or how to escalate the matter if Ms C remained unhappy with the outcome. The Council says Ms C’s enquiry was not flagged as a complaint. This is fault.
17. The Council confirmed to the Ombudsman on 4 March that Ms C’s complaint had not completed its complaints procedure and so the Ombudsman asked the Council to investigate and provide a response directly to Ms C.
18. The Council advised the Ombudsman it wrote to Ms C on 6 March to say it had issued a refund of £612 on 1 March 2019 and would be refunding £310 costs via its enforcement agents. There was no reference to the Ms C’s complaint or explanation for these amounts. Again, the Council did not explain how Ms C could escalate the matter if she remained unhappy with the outcome and did not advise how she could contact the Ombudsman. I did not consider this letter constituted a proper response to the Ombudsman’s referral which was further fault. The Council has subsequently confirmed these details relate to a third party and not Ms C.
19. I also consider there was a missed opportunity to resolve the matter at Ms C’s meeting with the Council in December 2018. The Council should have manually moved any mis-allocated payments between the two financial years and reissued a new bill with lower instalments. This action would have avoided the further recovery action. I note the Council has apologised to Ms C but consider a further remedy is required for this and the failings identified in its subsequent complaint handling.

Agreed action

20. The Council will take the following action within one month of my final decision:
1. write to Ms C to apologise for its failure to properly deal with her complaint as set out above;
2. pay Ms C £200 for the upset caused from the avoidable additional recovery action and her time and trouble in trying to resolve the matter;
3. provide Ms C with an up to date and clear explanation of her account as it now stands which should include the date the Council removed the summons costs of £69.50; and
4. issue a reminder to all relevant staff about the Council’s complaint procedure to ensure complaints are appropriately identified and responded to and complainants are appropriately signposted.

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Final decision

21. I have completed my investigation as I have found fault by the Council but consider the agreed actions above are enough to provide a suitable remedy.

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Investigator's decision on behalf of the Ombudsman