Summary: Miss D complained the Council failed to contact her when it did not receive her payments for council tax. We find the Council was at fault for failing to have a process in place when it did not receive Miss D’s council tax payments. The Council has agreed to our recommendations to address the injustice caused by fault.

The complaint

1. Miss D complained the Council failed to contact her when it did not receive her payments for council tax. She says the Council’s failures have left her with a huge council tax debt to pay.

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The Ombudsman’s role and powers

2. 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 significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. 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

4. I considered information from Miss D. I made written enquiries of the Council and considered information it sent in response.
5. Miss D and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Council tax

6. Council tax is a local tax, set by each local council, to help pay for local services. The council tax bill for the year is due on 1 April. A council will usually collect payment through monthly instalments.
7. Council tax reduction (CTR, also known as council tax support) is a discount on how much council tax someone has to pay. Applicants on low incomes may be able to claim a reduction.

What happened

8. Miss D pays council tax. She had a direct debit set up for her monthly instalments. She receives CTR.
9. The Council sent Miss D a letter in May 2023 and said her CTR entitlement had changed because her Universal Credit had been recalculated. This affected how much council tax she had to pay. Universal Credit is a benefit for working age people who are on a low income. It also sent her a revised bill showing the outstanding council tax. Miss D did not receive the Council’s revised bill because it went into her junk folder. The Council did not collect Miss D's council tax by direct debit.
10. Miss D’s CTR entitlement continued to change every month. The Council sent Miss D revised bills by email about the changes and the outstanding council tax. Miss D did not receive the bills. The Council did not take any of Miss D’s council tax payments by direct debit.
11. Miss D checked her council tax account in February 2024 and saw she was over £1,000 in debt. She contacted the Council and asked for an explanation.
12. The Council sent a letter to Miss D. It said the adjustments to her CTR clashed with the direct debit collection dates. There was not enough time to amend her direct debit payments, and therefore it did not take any payments by direct debit. It said this happened every month because of the constant changes to her CTR. As her account was set up in electronic billing, it did not pick this up in its error report. It said it would arrange a payment plan to clear the outstanding council tax. It also said it would take her account off electronic billing so it could adjustment the instalments manually every month.
13. Miss D complained to the Council about its failure to contact her when it did not receive the monthly direct debit payments. She said she had not received the council tax bills as they had gone into her junk folder. She said she had now reviewed the bills, and they did not state she was accruing debt.
14. The Council responded to Miss D’s complaint. It said it sent emails attaching the revised bills. They were not rejected by its system and so it considered she had received them. It said she could have contacted it when she noticed it was not taking money out of her bank account every month.

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Analysis

15. When the Council realised it was not receiving any council tax payments from Miss D, it should have contacted her to discuss the outstanding debt. In response to my enquiries, the Council said it sent Miss D revised bills. It also said it could not send her a reminder notice because the instalments were constantly changing. I have read the revised bills the Council sent to Miss D. While they show how much council tax was outstanding for the tax year, and what Miss D’s CTR award was, they do not clearly show Miss D had not paid for several months, and she should contact it to resolve the matter. I accept Miss D’s instalments were constantly changing, but there should have been an alert on the Council’s internal system when it was not receiving any payments for several months. The fact there was not one is fault. The Council continued to send bills, but it was not receiving any payment, and it did not take any other action to resolve the matter. This fault caused Miss D frustration and upset. She now has to pay back her council tax debt, and well as her monthly payments for this tax year.
16. While the Council was at fault, there was also some onus on Miss D to check her bank account and contact the Council when she realised it was not taking council tax payments every month. As she signed up for electronic billing, she could have also contacted the Council when she was not receiving any bills. Miss D says as a resolution to her complaint she wants the Council to waive the accrued council tax debt. I do not recommend this. Miss D was always liable for council tax, and if the Council had not been at fault, she would have been paying it regularly every month. The Council has offered Miss D a payment plan, which I welcome. However, I also recommend it apologises to Miss D for her injustice and puts in place service improvements to prevent a recurrence of the fault.

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Agreed action

17. By 11 November 2024 the Council has agreed to apologise to Miss D for the injustice caused by the fault identified in this statement.
18. By 9 December 2024 the Council will revise its process to ensure it has a proper alert and notification system in place when it does not receive council tax payments from customers that are registered for electronic billing and have variable council tax instalments because of changes to their CTR.
19. The Council should provide us with evidence it has complied with the above actions.

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Final decision

20. There was fault by the Council, which caused Miss D an injustice. The Council has agreed to my recommendations and so I have completed my investigation.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman