Summary: There was fault in the Council’s handling of the recovery of a housing benefit overpayment. However, it will now offer the complainant a fresh appeal right to the Tribunal, which is a suitable remedy. The Ombudsman has therefore completed his investigation.

The complaint

1. The complainant, to whom I will refer as Mr B, says the Council is seeking recovery of an overpayment of housing benefit from 2017. Mr B complains the overpayment was the result of administrative failure, and so he should not be required to repay it.

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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’. We provide a free service, but must use public money carefully. We may decide not to start or continue with an investigation if we believe there is another body better placed to consider this complaint. (Local Government Act 1974, section 24A(6), as amended)
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 cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, as amended)

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How I considered this complaint

5. I reviewed the Council’s correspondence with Mr B.
6. I also shared a draft copy of this decision with each party for their comments.

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What I found

7. In March 2017, the Council received information from the Department for Work and Pensions (DWP). This information indicated Mr B had been underpaid housing benefit (HB) over the previous 15 months. The Council calculated this underpayment was worth £3122.89, which it immediately to credited Mr B’s landlord (a housing association).
8. The following day, the DWP sent further information which reversed this decision. As the underpayment credit had already been assigned to Mr B’s rent account, it could not simply be recalled. The Council decided it would recover the overpayment from Mr B’s ongoing HB, by deducting £21.10 per week. The Council confirms it did not inform Mr B of this decision at the time.
9. In September 2017, the same thing happened again. On this occasion, the calculated underpayment was £4148.58. The Council used £2834.29 of this to pay off the March overpayment, leaving a credit of £1314.29.
10. The DWP again confirmed its information was incorrect, creating an overpayment of £4124.59. The Council used the £1314.29 credit to reduce the new overpayment, but this left an outstanding balance. The Council continued to deduct £21.10 from Mr B’s ongoing HB payments to recover this money.
11. The Council says Mr B queried his HB payments shortly thereafter. In December 2017, it wrote to explain the recovery to him.
12. In January 2019, the Council says changes in Mr B’s situation meant he was no longer entitled to HB. Because of this, it could no longer recover the outstanding balance from his ongoing benefit, and sent him an invoice for the full amount of £2208.56.
13. After receiving a Stage 1 complaint from Mr B, the Council replied on 18 February. It explained how the two underpayments / overpayments had come about, what the Council had recovered, and the remaining balance.
14. Mr B submitted a Stage 2 complaint on 15 March. He said he had not been made aware of the situation in March 2017, except that his rent had been paid for the following few months. He also said he had contacted the DWP, which had denied sending information to the Council which triggered the underpayment / overpayment decisions. Mr B asked the Council to write off the remaining debt.
15. The Council replied on 1 April. It again explained the circumstances behind the underpayment / overpayments, but said it had decided not to write off the debt. This was because the Council had written to Mr B at the time advising of the changes in his HB, the original underpayment had been used to cover Mr B’s rent for several months, and Mr B had declined the option for the overpayment to be recovered from his housing association.
16. On 3 May, Mr B referred his complaint to the Ombudsman.

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Legislative background

17. If a council pays too much housing benefit to someone it will usually ask them to repay it. The law says an overpayment is recoverable unless it was caused by an official error and it was not reasonable to expect the person to realise they were receiving too much benefit.
18. If someone disagrees with a decision that they must repay an overpayment they can appeal to the First Tier Tribunal. The law says people should appeal within one month of the date of the decision they think is wrong, but the Tribunal can accept late appeals up to 13 months after the decision.

Analysis

19. There is a complex history to Mr B’s complaint. But, in short, in both March and September 2017, roughly equal underpayments and overpayments were created of his HB. Ideally, these should have immediately offset each other, leaving no debt; but the Council had already given the March underpayment to Mr B’s landlord, and did not recover this money from it, leaving a debt.
20. The recovery of this was instead made from Mr B’s ongoing HB. This arrangement continued until January 2019, when Mr B’s entitlement to HB ended, and the Council then asked him to repay the remaining £2208.56.
21. The Ombudsman generally expects complainants to approach him within 12 months of becoming aware of the main issue they wish to complain about. He has discretion to accept late complaints, but must be satisfied there were good reasons the complainant did not approach him sooner. He must also be satisfied it is still possible to carry out an effective investigation.
22. It is not exactly clear when Mr B became aware of the Council’s decision to recover the overpayment. The Council has confirmed it did not inform Mr B of this in March 2017, but says it discussed the matter with him after the September overpayment.
23. And I can see, from Mr B’s own submissions, he was in contact with the Council in June and July 2018 about it, so I consider he could reasonably have raised a complaint with the Ombudsman sooner than May 2019. I appreciate his complaint was triggered by the invoice he received in January 2019, but this invoice related to decisions the Council had made over a year beforehand.
24. In either case, however, the Ombudsman’s role is to investigate administrative fault. While I can see the Council has accepted it made some errors here, what Mr B seeks from this complaint is a decision to write off the outstanding debt. The Ombudsman has no power to decide whether an overpayment is recoverable, and so cannot give Mr B this outcome.
25. Disputes about the recoverability of overpayments are a matter for the Tribunal. It has the power to decide whether it should be recovered, and, unlike the Ombudsman, its decision is binding on both parties.
26. There is an absolute limit of 13 months to appeal to the Tribunal. However, the Council has now confirmed it will re-issue its recoverability decision to Mr B, which should trigger a fresh appeal right.

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Summary

27. I cannot decide whether the Council should have decided to recover the overpayment from Mr B in March 2017. This is because Mr B’s complaint has been made too late, and this is not a decision the Ombudsman can make anyway.
28. I am satisfied it was fault the Council did not properly inform Mr B of its recovery decision in March 2017. This meant Mr B could not appeal to the Tribunal at that time, which is an injustice. It is also unclear whether the Council properly informed Mr B of his appeal right in September 2017.
29. However, the Council has now offered to re-issue its decision, giving Mr B a fresh appeal right. This is a suitable remedy and I make no further recommendations.

Final decision

30. I have completed my investigation with a finding of fault causing injustice.

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Investigator's decision on behalf of the Ombudsman