Summary: Miss X complains about benefits decisions the Council took that led to an overpayment of housing benefit. There was some fault by the Council and issues with its communication with Miss X. This led to some confusion. As a result, Miss X doubts her housing benefit payments have been correct and they may not have been correctly applied to her rent account. The Council agreed to make a payment to Miss X to recognise the time and trouble she spent pursuing the complaint. It agreed to re-examine and explain the decisions it made and correct any errors it found.

The complaint

1. Miss X complains the Council made an error with her housing benefit claim. She says she was told that underpayments of her housing benefit would be offset against an overpayment of housing benefit of £1207.94. She says this did not happen and she complains the overpayment the Council wants her to repay is wrong.
2. Miss X also complains that she should have received housing benefit for the first month after starting work. She says this was unpaid and the Council has not responded to her about this.

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The Ombudsman’s role and powers

3. The law says we cannot normally investigate a complaint when someone can appeal to a tribunal. However, we may decide to investigate if we consider it would be unreasonable to expect the person to appeal. (Local Government Act 1974, section 26(6)(a), as amended)
4. We can decide whether to start or discontinue an investigation into a complaint within our jurisdiction. (Local Government Act 1974, sections 24A(6) and 34B(8), as amended)

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How I considered this complaint

5. I spoke to Miss X and considered information she provided about her complaint. I also took account of information the Council provided and its complaint responses to Miss X and to her MP.
6. I considered the DWP guidance on housing benefit overpayments. I also took account of the Ombudsman’s jurisdiction to investigate complaints.
7. I issued a second draft decision after considering comments from Miss X and after further information from the Council. I considered the comments I received from both parties before reaching a final decision.

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What I found

What happened

8. Miss X complains about decisions made on her housing benefit claims and the effect this has had on her rent account.
9. There have been many adjustments to Miss X’s housing benefit claim which caused both the overpayment and underpayment of benefit. In response to queries from Miss X and her MP, the Council explained how it had calculated figures between 2017 and 2018.
10. Miss X complained to the Ombudsman that she could not understand an overpayment of £1207.94 and the way the Council dealt with this. Miss X says she was told by officers in June 2018 that there were underpayments that would be used to offset this overpayment. However, this did not happen. Rather than offsetting the overpayment she owed, Miss X told us that the amount she owed on her rent account increased to around £1800. Miss X did not feel it could be correct that she owed more if the Council had correctly used the underpayments to offset the overpaid benefit.
11. The rent statement Miss X sent us shows that a number or underpayments were added to the rent account. £457.16 was added in September 2017, £335.27 was added in March 2018 and £554.91 was added in April 2018.
12. The statement shows that before 18 June, Miss X owed £691.35 in rent. After adjustments were made on 18 June, she owed £1899.29. The difference is £1207.94.
13. The changes to the rent account on 18 June 2018 all appear in the “payments made” column. Each entry appears four times. However, the effect of the adjustments made on 18 June was to take back from the rent account a total of £1207.94.
14. The Council’s complaint response to Miss X’s MP on 24 December 2018 explained the Council decided it should transfer £1207.94 of the housing benefit underpayments from Miss X’s rent account to clear the outstanding overpayments. The Council stated it wrote to Miss X on 26 July 2018 to confirm, as a result, she no longer had any outstanding overpayments. This was a confusing statement because clearing the ‘overpayment account’ did not clear the debt itself. In effect, the Council moved the overpayment debt from the ‘overpayment account’ to Miss X’s rent account, so Miss X still needed to repay it. This was not well explained.
15. In its contacts with Miss X the Council referred to an error occurring on her account which it would investigate. The Council told us what it meant by this. It stated all underpayments have to be placed into the person’s rent account. But then, if overpayments exist, the Council should decide if it should use the underpayments to offset them. If the underpayments are to be used to offset an overpayment, it should move them to the overpayment account at that time they are created, it should not leave them in the rent account. In Miss X’s case, the overpayments were left in the rent account for some time. This has the potential to cause confusion as it may be unclear to the person concerned what the correct position is. The Council acknowledged that it did not explain what happened properly to Miss X at the time.
16. When taking account of all the adjustments to housing benefit from 2017 I understand the Council’s position is that this left a shortfall between the amount of rent due and the rent that was actually paid by housing benefit payments and what Miss X had paid. I note the Council stated in its responses to Miss X’s queries that it had taken account of the income details Miss X provided as well as information from DWP.
17. Miss X is very concerned that an error has been made. Miss X stated she believed;
• her housing benefit was wrongly cancelled from 5 February 2017 to 19 June 2017;
• the Council has not properly taken account of her income when working out the housing benefit she is entitled to and it made errors with housing benefit payments made when she started work.
• she was not paid the correct extended payment in 2017, although an extended payment was later paid in August 2018 after Miss X raised this.
18. Miss X considers, as a result of errors the Council made, the £1207.94 overpayment added to her rent account was incorrect. The Council stated it appeared that the shortfall had been caused because Miss X had made insufficient payments to the rent account for periods when she did not receive full housing benefit. She disagreed this was the cause.

Rights of Appeal

19. The law says we cannot normally investigate a complaint if someone can appeal to a tribunal. The Ombudsman expects people to use any rights of appeal they have unless it would be unreasonable to expect them to do so.
20. A specific right of appeal to a tribunal exists to enable someone to challenge decisions about the amount of benefits paid or an overpayment decision. The tribunal can specifically decide if a Council’s decisions on benefits are correct.
21. The Council provided examples of its standard letters. These confirm when rights of appeal exist to ensure people have the chance to use them. As the Council’s letters confirm that rights of appeal may be used to challenge their decisions, I would expect Miss X to have requested an appeal against the decisions she believes to be incorrect. While appeals should generally be carried out within a set timescale, Miss X may ask the Council if a late appeal is possible in her case.

DWP Housing Benefit Overpayment Guidance

22. The DWP guidance about housing benefit overpayments sets out what actions Local Authorities may take in the recovery of housing benefit overpayments. Paragraph 4.90 states that where the Local Authority is also the Landlord, it may decide to recover the overpayment by transferring the debt to the rent account. The guidance states that it should note the debt is not rent arrears and must be distinguished from any rent arrears.
23. The Council should clearly distinguish between the overpayment debt and rent arrears in further correspondence with Miss X. However, it is entitled to recover the overpayment in this way.

Analysis

24. The situation surrounding Miss X’s benefit claim is complicated as there have been various changes to the amount of benefit due and these have sometimes been backdated creating overpayments and underpayments.
25. The Ombudsman cannot establish whether individual housing benefit payments have been made correctly. So, I can consider the detailed points Miss X would like us to, and I cannot decide if the correct housing benefit was paid to Miss X.
26. If Miss X wished to challenge benefit decisions, she would need to do this through an appeal to a tribunal.
27. Miss X says she was not aware that she had rights of appeal and was not told of a tribunal. However, I am satisfied that the Council’s standard benefit decision letters do include information about making appeals. So, I am satisfied it was stated in letters sent to Miss X, and she had the opportunity to use these rights.
28. The Ombudsman cannot now consider whether the benefit decisions were correct, this was something that needed to be put to the tribunal.
29. In terms of the large overpayment of £1207.94, the Council has effectively transferred the debt from a specific overpayment account to Miss X’s rent account. Government guidance confirms this is an action that Local Authorities are entitled to take. There is no fault with this.
30. In the same way that the Ombudsman cannot decide if benefit payments were correct, we cannot decide if the overpayment was correct. This too should have been referred to the Tribunal if Miss X disagreed with it.
31. However, I can see there has been some issues with communication in Miss X’s case. Leaving the underpayments in her rent account rather than using them to offset the overpayment straight away may have caused some confusion. When Miss X challenged the situation, it could have been better explained. So, there was some fault by the Council.
32. The Council’s use of the rent account to recover the overpayment is acceptable. However, we cannot determine if the benefits decisions and overpayment decisions themselves were correct.
33. Given the confusion and doubt for Miss X about whether the figures are correct, I recommend the Council agreed to a late appeal against the £1207.94 overpayment and whether the benefit payments were correct when she started work.
34. The Council agreed to my recommendation to accept a late appeal. However, it noted that the Tribunal does not accept appeals when they are over 13 months from the date of the decision. The Council agreed to re-examine and explain the any decisions that are of concern to Miss X and it agreed it would send a late appeal request if Miss X insisted, but it warned that these decisions may not be considered by the Tribunal.
35. I welcome the council’s agreement to re-consider the decisions that are of concern to Miss X and for its agreement to recognise the time and trouble Miss X spent pursuing the complaint.
36. I do not consider the Ombudsman can achieve anything further for Miss X, so I have completed my investigation on the basis that the Council takes the action it agreed.

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Agreed Actions

37. The Council agreed to re-examine and explain the housing benefit decisions that are of concern to Miss X. If Miss X insists, the Council will submit a late appeal to a Tribunal. However, due to the Tribunal’s time limits, it should be noted this is likely to be unsuccessful.
38. To recognise the need for Miss X to pursue the complaint to the Ombudsman, the Council agreed to pay her £150. The Ombudsman’s policy allows this to be offset against any debts, so this may be used to offset rent arrears if appropriate.
39. The Council should contact Miss X within two weeks from today to confirm the points to be re-examined. It should re-examine and explain these points within six weeks. It should make the payment to Miss X within six weeks.

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Final decision

40. I have found some fault by the Council. The council agreed to remedy this so I have now completed my investigation.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman