The Investigation

The complaint

1. Ms B complained that the Council in respect of her council tax for 2019/20:

• wrongly closed one account and opened a new one;

• took 10 months to identify the error and correct it;

• in the meantime, it sent four bills indicating the account was in credit and that she could get a refund;

• reissued the correct bill in March 2020 demanding payment in full within weeks;

• wrongly obtained a liability order and referred the debt to bailiffs, who traced the account to the wrong address; and

• delayed in sending complaint responses, sent them by email rather than post and did not answer all Ms B’s points.

2. She was caused significant confusion, distress and time and trouble in trying to understand her account.

Legal and administrative background

The Ombudsman’s role

3. We investigate complaints about ‘maladministration’ and ‘service failure’. In this report, we 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. We 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)

Council tax recovery

4. The council tax bill for the year is due on 1 April. A council will usually collect payment through monthly instalments. If any instalment is missed, the council will send the liable person a reminder. If a payment is still not made or a further payment missed, then the entire outstanding balance will be due (that is the full amount for the rest of the year).

5. To use the various powers available to it to recover unpaid council tax, a council must apply to the magistrates court for a liability order against those it believes are liable. Once a council has obtained a liability order it can take recovery action.

6. A liability order gives a council the legal power to take enforcement action to collect the money owed. This can include taking deductions from benefits, getting an attachment of earnings (this means deductions are taken directly from earnings by an employer and passed to the council) or using bailiffs. The council can decide which recovery method it wants to use but it can only use one method for one liability order at one time.

Public sector equality duty

7. The public sector equality duty requires all local authorities (and bodies acting on their behalf) to have due regard to the need to:

• eliminate unlawful discrimination, harassment and victimisation and other conduct prohibited by the Equality Act 2010;

• advance equality of opportunity between people who share a protected characteristic and those who do not; and
• foster good relations between people who share a protected characteristic and those who do not.

8. The broad purpose of the public sector equality duty is to consider equality and good relations in the day-to-day business and decision-making of public authorities. It requires equality considerations to be reflected in the design of policies and the delivery of services, including internal policies, and for these issues to be kept under review.

Principles of good administrative practice

9. We have published guidance on good administrative practice since 1993 to show the standards we expect when we investigate the actions of local authorities. We reviewed this document in December 2018 and it includes the following principles.

10. Being service-user focused

• Ensuring people can access services easily, including those needing reasonable adjustments.

• Informing service users what they can expect and what the organisation expects of them.

• Keeping to commitments, including any published service standards.

• Dealing with people helpfully, promptly and sensitively, taking account of their individual circumstances.

• Responding to service users’ needs flexibly and, where appropriate, coordinating a response with other service providers.

• Recognising and respecting the diversity of service users and adopting an inclusive approach.

11. Putting things right

• Acknowledging mistakes and apologising where appropriate.

• Putting mistakes right quickly and effectively.

• Providing clear and timely information on how and when to appeal or complain.

• Operating an effective complaints procedure, which includes offering a fair and appropriate remedy when a complaint is upheld.

How we considered this complaint

12. We produced this report after examining relevant documents from the complainant and the Council.

13. We gave the complainant and the Council a confidential draft of this report and invited their comments. The comments received were taken into account before the report was finalised.

What we found

14. Ms B had a severe mental illness for many years but had improved and was receiving universal credit, housing benefit and council tax support (CTS). In April 2019 she wrote to the Council informing it that her daughter had moved out in February 2019. She said her benefits had recently stopped and she did not have any money to pay the council tax bill. She requested bills in her name only and the single person discount. She did not provide an email address for communication.

15. In May 2019 the Council closed her account (Account Y) and opened a new one (Account Z). It sent an email to Ms B using an address it had on its records. The email explained the actions taken and asked her to confirm if any other adults were living in the property. If not, it would award the single person discount. Ms B did not use the email account and did not receive the email.

16. On 20 May 2019 Ms B wrote again to the Council querying why she had received two bills, with no discount and no CTS. The Council then sent two bills on 29 May 2019 showing credits of over £1,000 on Account Y. The bills said at the bottom:

“Your Council Tax account is currently in credit. Please contact the Council if you wish to discuss a refund”.

17. Ms B wrote to the Council on 8 June 2019 asking it to transfer the credits to the bills for 2019/20 and 2020/21. She asked the Council to confirm it had carried out her requests. She did not provide an email address.

18. On 18 June 2019 the Council removed the credit of CTS from the bill for 2019/20 and sent two more bills showing credits of around £80 on Account Y and again offering a refund. It also sent two bills on Account Z with outstanding balances of £1,110 and £73. The Council sent an email to Ms B explaining that the credits on the previous bills were not credits but just showing how much CTS she had received. It also confirmed it had removed her daughter’s name from the account. Ms B did not receive this email.

19. In July 2019 it awarded the single person discount on Account Z and sent revised bills showing a balance owing of £18 for 2018/19 and £636 for 2019/20.

20. In September 2019 the Council removed the credit of CTS from the bill for 2018/19 and sent a bill showing a zero balance on Account Y.

21. At the end of October 2019 Ms B, in responding by letter to an email about a housing benefit matter, requested that the Council send all its communications to her by letter.

22. In November 2019 the Council sent a reminder for the missed instalments on Account Z. Ms B replied by letter in early December 2019 saying she could not afford to pay until she had cleared another debt, but she would start paying £50 a month in February 2020. She queried why she had two account numbers.

23. The Council sent a second reminder on 13 December 2019 and then a summons. Ms B acknowledged receipt of the summons and asked why the Council had not replied to her previous correspondence. On 24 December 2019 the Council sent her, by post, a financial form to complete in respect of her offer of repayment. On 13 January 2020 it accepted her offer and said the summons costs would be removed when she cleared the debt. The Council obtained a liability order on 14 January 2020.

24. Ms B wrote to the Council on 29 January 2020 asking why it had not responded to her previous correspondence. In February 2020 the Council closed Account Z and reopened Account Y, applying the single person discount from the date her daughter left. It sent Ms B a letter explaining this. It also said it had asked the benefit section to reassess her benefit entitlement. It sent revised bills for both 2018/19 and 2019/20.

25. In March 2020 the Council sent two bills showing credits of almost £700 of CTS for Account Z and saying Ms B could ask for a refund. The Council says it removed these credits from the account later in March 2020 and sent bills for 2018/19 and 2019/20 showing zero balances. It sent a revised bill for the re-opened Account Y for £548 and asked for payment by 11 April 2020.

26. On 18 April 2020 Ms B wrote to the Council requesting the credits, shown on the bills for Account Z from 6 March 2020, be transferred to the outstanding balance on Account Y. There is no evidence the Council replied to this.

27. Ms B made three payments in March, June and August 2020.

28. The Council sent two reminders in August and September 2020 for the balance on Account Y and a final notice in November 2020. In March 2021 it sent a summons and then a liability order for £493.

29. Between March and July 2021, the Council received two enquiries from Councillors on behalf of Ms B and one from her MP. She believed she had made more payments than the Council had shown on the bills. The Council responded by email to Ms B and asked for evidence but did not receive anything. It explained that it had transferred all the payments she had made from Account Z to Account Y but that it could not transfer the credits for CTS as these were not amounts she had paid, but overpaid benefit.

30. In December 2021 the Council passed the account to the bailiffs for recovery but it was returned. It referred it again in January 2022 and in March 2022 the bailiffs sent Ms B a notice of enforcement for £459. Ms B’s MP chased the Council for a response to their enquiry from July 2021.

31. The Council responded by email to a different email address on 17 March 2022. It said it should not have closed Account Y and opened Account Z in May 2019 when removing Ms B’s daughter from the account. It said it had corrected this in February 2020 by deleting Account Z, including the recovery action and reopening Account Y. It said this was to simplify Ms B’s council tax responsibilities. It gave a detailed account of when it transferred the payments over to Account Y and said the outstanding balance was now £459. It advised her to contact the bailiffs to make an arrangement to pay.

32. On 2 April 2022 Ms B’s father, Mr C, made a complaint (in writing by post) on her behalf, to the Council. He said he had been unable to attend the court hearing due to COVID-19 and said the Council had sent Ms B two bills in March 2020 clearly showing that her account was in credit.

33. The Council replied (by email to both email addresses it held for Ms B) at stage one of its complaints procedure on 20 April 2022. It said the credit balances shown on the bills in March 2020 were overpaid CTS and not available for refund. It did not uphold the complaint but said it had recalled the debt from the bailiffs and made an attachment of benefits order from her benefits to recover the outstanding balance.

34. Mr C escalated his complaint on 12 May 2022 and included the complaint that the Council was sending email replies when he and Ms B always wrote letters and posted them. He questioned why the Council could not reply in the same manner because they both had difficulty accessing emails.

35. The Council replied in July 2022. It said its standard method of response to all correspondence is by email unless a request for an alternative method was made. It did not uphold the complaint and again explained that the credits shown on the accounts were ‘false credits’ due to overpaid CTS and were not available for a refund. It offered sincere apologies for the errors.

36. It went through the actions on each account and said as a gesture of goodwill it had removed the recovery costs of £125 on Account Y. It said the bailiffs had tried to trace Ms B in January 2022 but had located an incorrect address for her. It apologised for this and said the account had been recalled from the bailiffs. It confirmed the debt was being recovered via Ms B’s benefits.

37. Mr C complained to us on behalf of Ms B.

38. In response to a draft of this report, the Council says it was not incorrect to open a new account but it should have applied a ‘bill inhibit’. This would have prevented revised bills being issued for one month to allow the CTS to be moved to the correct account.

Conclusions

Two accounts

39. The Council was at fault for closing Ms B’s original account (Account Y) and opening another in May 2019 after her daughter had left the property. It could simply have amended the details on Account Y and added the single person discount once it was satisfied Ms B was the only adult in the property. Another option it has suggested latterly, would have been to inhibit the production of new bills for one month to allow for the benefit changes to be made. It did neither of these things, which was fault. This created confusion as the Council did not explain why it had created another account and the changes generated 20 bills in the space of 10 months. This caused Ms B confusion and uncertainty over what she actually owed.

40. Ms B received four bills in May 2019, two of which showed large credits on her account and said she could ask for a refund. This misleading information meant Ms B believed she did not owe council tax for either 2018/19 or 2019/20 because the credits would clear the balance. The Council said much later that these were ‘false credits’ of overpaid CTS and the money was never available for a refund. This should have been explained when the bills were sent as the information provided clearly indicated the accounts were in credit. This failure to provide accurate information on the bills was fault.

41. Following Ms B’s request to transfer the credits the Council sent four more bills in June 2019, two of which still showed credits, albeit for smaller amounts, followed by further bills for different amounts in July and September 2019. The bills did not contain enough information to enable Ms B to understand the changes and one of them showed a zero balance. This was further fault.

42. The Council took 10 months to correct the error in February 2020 and while the intention to simplify the account was positive, the reality was more confusing bills showing ‘false credit’ balances from overpaid benefit which again led Ms B to request the Council to transfer the credits to the outstanding balances. This was also fault which caused Ms B confusion and uncertainty.

Communication

43. The Council sent an email to Ms B in May and June 2019 explaining its actions and the fact that the credits were due to overpaid benefit and could not be refunded. However, the emails did not reach Ms B because she had not provided the email address and did not have access to them. She wrote to the Council by letter which she posted. None of her letters contained an email address and in October 2019 she specifically requested all communication by letter not email. We consider the Council should have checked with her whether she was able to access the email addresses it held on its record and until it received a positive response, it should have communicated with her by letter sent in the post.

44. The failure to do so was fault which meant that Ms B did not receive any explanation for the actions the Council had taken with her council tax accounts or the ‘false credits’ which she believed would clear the outstanding balances.

45. The Council continued to communicate with her by email, none of which she received. It also responded to the Councillors’ and MP’s enquiries by email, as well as Mr C’s first complaint. Ms B did not get a full explanation of what had happened to her council tax until July 2022 when the Council finally sent a letter. This was more than three years after Ms B had contacted the Council about her change of circumstances. The continued use of email was significant fault which meant Ms B did not understand what action the Council had taken with her account and why.

46. There are many reasons people do not use or cannot access email and they may have specific disabilities, be elderly or vulnerable in other ways. We consider the Council’s policy of only using email unless a specific request is made, is too restrictive and may prevent more vulnerable people (including those with a protected characteristic) throughout the borough from accessing the Council’s services properly.

Complaint handling

47. The Council’s complaint handling was also at fault. At stage one it did not acknowledge any fault in either the way it handled the account or the information on the bills. At stage two it apologised for errors but did not uphold the complaint which was contradictory. As errors had been made which caused delay and confusion it should have upheld the complaint and offered Ms B a remedy for the delay and confusion she experienced.

Recovery action

48. We have not identified fault with the recovery action the Council took, but we consider that if it had provided explanations for the ‘false credits’ and the two accounts at an earlier stage, Ms B would have known how much she owed and been able to keep to a payment arrangement. This may have prevented the debt being referred to the bailiffs.

Recommendations

49. The Council must consider the report and confirm within three months the action it has taken or proposes to take. The Council should consider the report at its full Council, Cabinet or other appropriately delegated committee of elected members and we will require evidence of this. (Local Government Act 1974, section 31(2), as amended)

50. We welcome the Council’s actions in removing the costs of the court action from the bills, but we consider a further payment is appropriate to recognise the length of time this situation continued and the failure to communicate with Ms B in her preferred way.

51. So, we recommend the Council, within three months of the date of this report:

• apologises to Ms B and pays her £334 (which can be used to clear the remaining council tax balance with Ms B’s permission);

• takes steps to ensure all future communication with Ms B is by letter sent through the post;

• reviews the content of its council tax bills to include a clear explanation of when apparent credits of council tax support are not refundable and to remind staff to apply a ‘bill inhibit’ for one month;

• reviews its communication policy to ensure that those people who cannot or do not want to communicate by digital means, are able to access Council services and communications; and

• provides training to staff on complaint handling to ensure our principles of good practice are implemented.

Decision

52. We have completed our investigation into this complaint. There was fault by the Council which caused injustice to Ms B. The Council has agreed take the action identified in paragraph 51 to remedy that injustice.

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