Summary: Mr X complains the Council incorrectly used an attachment of earnings to recover council tax arrears directly from his wages. We have concluded our investigation having made a finding of fault. The Council used an attachment of earnings despite Mr X making payments in accordance with an agreed repayment arrangement. The Council were also delayed in responding and acknowledging Mr X’s complaint, which could have prevented matters. The Council have accepted our recommendations.

The complaint

Mr X complains that the Council incorrectly used an attachment of earnings to recover council tax arrears directly from his wages when he was making payments in accordance with an agreed arrangement. Mr X says this caused him financial hardship and has impacted his ability to pay other debts he owes. Mr X would like the Council to apologise, terminate the attachment of earnings and make an award in recognition of the distress and impact the Council’s actions has had on him.

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The Ombudsman’s role and powers

1. 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)
2. 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)

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How I considered this complaint

3. I considered the information Mr X provided. I also raised enquires with the Council and considered the information it provided. Mr X and the Council had an opportunity to comment on my draft decision and I considered their comments before making a final decision.

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What I found

Relevant law and guidance

Council Tax Recovery

4. The council tax bill for the year is due on the 1st 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 has to 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 legal powers to take enforcement action to collect the money owed. This can include taking deductions from benefits, getting an attachment of earnings (by which 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 wishes to use but it can only use one method for one liability order at one time.

The Council’s complaints procedure

7. The Council says it will acknowledge stage one complaints within two days and identify an appropriate manager to act as the investigating officer. The Council says that if it needs more time, it will contact the complainant to discuss this.

What happened

8. I have included a summary of some of the key events below. This is not intended to be a comprehensive account of everything that took place.
9. Mr X’s complaint is centred around council tax arrears from 2019/2020, but some of the communications and correspondence relevant to the complaint involve communications and correspondence from the 2020/2021 and 2021/2022 council tax periods.

2019/2020

10. The Council issued Mr X his annual bill for 2019/2020 in March 2019. Mr X did not make his first payment and so the Council issued a reminder in May 2019. The Council did not receive payment and so it sent Mr X a summons at the end of May 2019. In June 2019, the Council obtained a liability order for the outstanding amount plus costs, of £1,248.83.
11. In November 2019, the Council applied for an attachment of earnings order. In November 2019, deductions were made from Mr X’s wife’s earnings but ceased shortly after when it was informed that Mr X’s wife was going on maternity.
12. Mr X held a call with the Council in April 2021 where he agreed an arrangement to clear the arrears by way of 23 monthly payments of £20.92 and a final payment of £20.82. The Council emailed Mr X with confirmation of this arrangement later that day. Mr X continued to make payments as per the arrangement agreed with the Council.
13. On 1 November 2022, the Council wrote to Mr X to inform him that he had not made payments as per the repayment arrangement it made with him in April 2022. The Council informed Mr X that if he did not contact the Council within 14 days, it would seek to recover the debt by issuing an attachment of earnings.
14. Mr X contacted the Council on 5 November 2022, providing evidence that he had made payment as per the repayment arrangement he agreed with it. Mr X received the attachment of earnings order on 8 December. The Council acknowledged Mr X’s email on 9 December to inform him that its revenue service would be in contact.
15. Between 8 December 2022 and 22 December 22, the Council took payment for the remaining £167.26 that was outstanding.
16. On 20 December 2022, the Council contacted Mr X, reaffirming that he had not adhered to the previous repayment arrangement it had agreed.

2020/2021

17. Mr X began making of £176 per month in August 2020, however payment stopped in February 2021. The Council sent Mr X a reminder for £176 in March 2021. On 7 April 2021, the Council sent Mr X a summons for the remaining £352.
18. With support from Charity Y, Mr X sent the Council a cheque for £250 on 6 April 2021. The Council did not receive this until 9 April 2021. On 7 April 2021, the Council sent Mr X a summons for the outstanding balance.
19. Mr X emailed the Council to inform it that he had sent a cheque to be applied against the arrears.
20. The Council applied the funds from the cheque to Mr X’s council tax account on 15 April 2021. On 20 April 2021, the Council responded to Mr X, acknowledging that the summons had been issued before receipt of the cheque.
21. Mr X emailed the Council a few days later to inform it that the arrears specified on the summons was incorrect as the Council had since applied the funds to the account. Mr X informed the Council he had the funds ready to clear the remaining arrears. The following day, Mr X made payment of £102 to clear the balance.

2021/2022

22. When Mr X spoke with the Council on 22 April 2021 to discuss the arrears from 2019/2020, he also set up a direct debit for £123 a month to commence in May 2021. Mr X began making payment as agreed with the Council, but this ceased in August 2021. Mr X was sent a second reminder for an amount of £123 in October 2021.
23. In November 2021, the Council sent Mr X a summons for the outstanding balance of £861. In December, the Council obtained a liability order for the outstanding amount plus costs, of £949.50.

Analysis

Repayment arrangement

24. As part of my enquiries, I asked the Council to provide up to date statements of account for Mr X’s council tax. From the evidence available to me, I can see that Mr X made payment in accordance with the agreed repayment plan of £20.92 per month. The Council wrote to Mr X to inform him that he had not adhered to the repayment arrangement, and it set up an attachment of earnings to clear the remaining balance. This is fault by the Council, as Mr X paid in accordance with the repayment arrangement it had agreed with him.
25. Matters were further exacerbated by the Council by not acknowledging the correspondence and evidence Mr X supplied to it in November 2022. The Council gave Mr X a deadline of 14 days to make contact and discuss the outstanding balance before it would recover the debt by issuing an attachment of earnings. Had the Council or its complaints department acknowledged Mr X’s correspondence, it could have stopped the attachment of earnings and prevented the deductions being taken from Mr X’s wages. I have not seen any evidence to demonstrate the Council acknowledged or registered Mr X’s concerns as a complaint and this is fault.
26. When setting up the repayment arrangement with Mr X, he supplied the Council with an income and expenditure form to demonstrate what he could afford. As per the repayment arrangement Mr X agreed with the Council, when it made deductions from his wages, it took 8 months’ worth of repayments over a period of two weeks.
27. This put further financial pressure on Mr X during the holiday period, which he would have not anticipated nor accounted for. Further, correspondence regarding non-payment was clearly sent to Mr X in error causing additional distress, as the Council has acknowledged receipt of Mr X’s payments and does not dispute that it received them. Mr X also has anxiety, which he informed the Council about, and this would have contributed to the distress imposed by the Council.

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Agreed action

28. To resolve matters, the Council have agreed to:
1. Pay Mr X an amount of £250. This is to acknowledge the impact its actions had on Mr X, including undue financial pressure, and distress caused by the correspondence it sent him for non-payment.
2. Considers what steps it can take to improve its procedures to enable the Council to respond to complaints in accordance with its complaint’s procedure.
29. The Council will complete action a within one month of the Ombudsman’s final decision, and action b within two months of the Ombudsman’s final decision.

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Final decision

30. I have concluded my investigation having made a finding of fault. The Council used an attachment of earnings despite Mr X making payments in accordance with an agreed repayment arrangement. The Council were also delayed in responding and acknowledging Mr X’s complaint, which could have prevented matters. The Council have accepted my recommendations.

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Investigator's decision on behalf of the Ombudsman