Summary: Ms C complains about failings by the Council in its administration of claims she made for housing benefit and council tax support. We uphold the complaint finding the Council lost evidence provided by Ms C, delayed in reviewing her case and failed to take account of its own policy for recovering council tax. These faults caused Ms C distress and put her to unnecessary time and trouble. The Council accepts these findings and at the end of this statement we explain the action it has agreed to remedy this injustice.

The complaint

1. Ms C complains about failings in the Council’s administration of her claims for housing benefit and council tax support. Ms C says that between July 2018 and January 2019 the Council delayed decisions, made errors in assessment and communicated poorly with her. It continued to collect council tax including issuing a summons for non-payment, even though Ms C contacted it to advise she was trying to claim council tax support.
2. Ms C says these events caused her distress and she experienced time and trouble in resolving her benefit claims. She also had to move money from her business to personal account to avoid rent arrears.

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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. The Social Entitlement Chamber (also known as the Social Security Appeal Tribunal) is a tribunal that considers housing benefit appeals. (The Social Entitlement Chamber of the First Tier Tribunal). The Valuation Tribunal deals with appeals against decisions on council tax liability and council tax support or reduction.
5. 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)
6. We provide a free service but must use public money carefully. We may decide not to continue with an investigation if we believe it is unlikely we would find fault, or it would be reasonable for the person to ask for a council review or appeal. (Local Government Act 1974, section 24A(6), as amended)
7. If we are satisfied with a council’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

8. Before issuing this decision I considered:

• Ms C’s written complaint to the Ombudsman and supporting information she provided;
• information provided by the Council in response to my written enquiries;
• comments made by Ms C and the Council in response to a draft decision statement where I set out my proposed findings.

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What I found

Background and chronology of events

9. The beginning of events covered by this complaint is July 2018. Ms C became self-employed after receiving Job Seekers Allowance (JSA) for some time. She received housing benefit and council tax support to help her with the costs of rent and council tax which are both benefits administered by the Council.
10. Ms C told the Council of her change of circumstances and the Council briefly suspended her claims. But a few days later, in mid-July 2018, it made ‘extended payments’ of housing benefit and council tax support to Ms C. These are payments which some former recipients of JSA can receive when they enter employment or become self-employed. The payments entitle the claimant to receive the same housing benefit and council tax support as they received when also claiming JSA for six weeks.
11. At the same time the Council decided it could not continue paying Ms C housing benefit and council tax benefit after the extended payments ended. This was after it considered information Ms C provided giving her estimated income and expenses from self-employment. It decided from the first week in August Ms C’s income would be too high to qualify for any benefit.
12. The Council therefore sent two decision notices to Ms C the same day. It also sent a third letter which asked Ms C to confirm her projected income over next 13 weeks and provide bank statements. The Council says that it could not include all information in one letter because of the limitations of the IT system it uses to print off notification letters. But enquiry letters enable officers to enter free text which can explain why they are making enquiries.
13. Before the end of July 2018 Ms C provided more information to the Council including bank statements and a cash flow forecast. The forecast projected different income figures to previously. The Council scanned Ms C’s bank statements into its records but did not scan the forecast.
14. Consequently, the Council re-assessed Ms C’s housing benefit and council tax support based on the bank statements only. It did not notice the missing income forecast even though Ms C highlighted this in her covering email. The reassessment produced the same result. The Council continued to find Ms C would not qualify to receive housing benefit and council tax support after the first week of August 2018 because her income was too high.
15. The Council told Ms C of this decision in writing. It also sent her a second letter which invited her to complete a form to declare her self-employed income and expenses.
16. Ms C returned this form in mid-August 2018. She also provided another cash flow statement.
17. Also, in August 2018, Ms C began to fall behind in paying her council tax. She received a reminder for not paying an instalment. Ms C sent an email to the Council to let it know she had sent information to resolve her benefit claims. Ms C then spoke to the Council. She also made a small payment towards her council tax. The Council recorded Ms C saying she was “paying what she can afford” towards her council tax.
18. Ms C contacted the Council again in mid-September 2018 to check if it could now re-assess her benefit based on the information provided since August. She provided another updated cash flow projection. The Council kept a record of its conversation with Ms C. This says it told her it had not re-assessed her claim yet, as it was waiting for “full years details”.
19. Ms C again chased the Council to re-assess her benefits before the end of September. When she contacted it again, in October, the Council told Ms C to make another claim for housing benefit and council tax support. Ms C did this, completing another form for self-employed claimants. She later also provided the Council with up-to-date details about her rent.
20. Before the end of the month Ms C made a complaint via a third party service. Ms C provided me with a screenshot confirming this. The Council has no record of receiving this until Ms C sent a copy in December.
21. Between mid-October and mid-November the Council recorded Ms C contacting it on five more occasions to check the progress of its reassessment. The Council says it has a policy that its customer service staff should forward such contacts to a manager in its benefit service, where there is a delay in resolving a claim. But it did not do this in Ms C’s case, which it recognises was an error.
22. The Council went on to re-assess Ms C’s claim in mid-November 2018. It found that Ms C could receive housing benefit of around £100 a week from August 2018 and council tax support worth around £10 a week.
23. Around two weeks later the Council cancelled Ms C’s claim for housing benefit. This followed her moving on to Universal Credit, a benefit administered by the Department of Work and Pensions which includes payments for housing costs.
24. In December 2018 Ms C asked the Council to re-assess her housing benefit and council tax support again. She considered the income figure used to assess her claim was wrong. She also made a complaint about the delays in resolving her claim.
25. In January 2019 the Council explained how it reached its November 2018 decision. But it also invited Ms C to provide more information so it could reconsider.
26. In mid-January 2019 the Council issued a summons to Ms C for non-payment of council tax. This added around £90 of costs to her bill.
27. Ms C provided more information to the Council and before the end of January 2019 it issued a revised decision. Ms C could now receive her maximum entitlement of housing benefit and council tax support for the full August to November period. This totalled around an extra £15 a week in benefits.
28. Ms C’s council tax bill reduced following this change. In considering Ms C’s complaint the Council agreed to write-off the costs added to her account. Because of payments made by Ms C, by the end of January 2019 she was in credit. The Council went on to refund this to her.
29. Ms C went on to have further exchanges of correspondence with the Council between January and July 2019. In March she asked the Council to reconsider the amount it paid as housing benefit towards service charges, after receiving a demand from her landlord in February 2019 for these. The Council did not reply for around two months. But after chasing by Ms C it said that it would not award more benefit. In further explanation sent in July it said: “Your case file has been checked and I can confirm that we have paid all the benefit that was due to you including eligible service charges that we included in the rent you were charged when your benefit was assessed”.
30. In general comments on the complaint the Council recognises there were delays in dealing with information Ms C provided for it to reassess her housing benefit and council tax support. In response to a suggestion from Ms C that it pay her compensation, it has previously said: “As a local authority responsible for administering public funds we do not have a policy to pay out compensation at a customer’s request once we have investigated and provided a decision as why we cannot agree any payment without the specific recommendation of the Local Government Ombudsman”. The Council now says this was wrong as it can pay a financial remedy where it considers it appropriate, without a recommendation from this office.
31. As part of my enquiries I also asked the Council about its policy when collecting council tax from those who it knows are waiting on the result of a council tax support claim. The Council referred to case law which has held local authorities can collect council tax when such claims remain outstanding. But it also said it had its own policy for considering interim payment arrangements where it expected its officers to consider “each case on its merits”. The policy says: “These can be worthwhile where the taxpayer has a reduced means for a limited period of time or may be paying a previous debt. For example, a taxpayer could be starting a new job or is waiting for an assessment to be completed on their council tax support […]. These arrangements usually involve a short period (three or four instalments) where the taxpayer pays a set amount with the remainder set on the fourth or fifth as a lump sum. The taxpayer is then encouraged to contact the office to review the temporary arrangement”.
32. The Council says in response to this investigation it has issued a reminder to its council tax staff they have discretion to hold recovery action where a claim for council tax support is outstanding.
33. Further to issuing a draft decision on this complaint the Council also recognised that it had wrongly dealt with Ms C’s request to consider the demand she received for service charges in February 2019. While it says it could backdate a housing benefit award to cover these, it has made a discretionary housing payment to cover the charges for the time Ms C received housing benefit.

My findings

Ombudsman’s jurisdiction and use of discretion

34. I explained above we will not usually take a view on a complaint where a complainant has (or has had) the alternative remedy of appeal to a tribunal. This is always a consideration in cases involving disputes around housing benefit or council tax support. As in both cases, if there is a dispute about a Council’s assessment, the claimant has the right to appeal to the relevant tribunal.
35. In addition, before any appeal reaches a tribunal the Council has the right to review its own decision in the claimant’s favour. We will usually use our discretion not to investigate a complaint where a complainant has such a right of review.
36. These considerations are relevant to how I have considered Ms C’s complaint. I have decided not to investigate the Council’s assessments made in July 2018 and mid-November 2018. Ms C successfully reviewed both. So, the right of review or appeal corrected any mistakes in the assessments. Consequently. it would not be proper for me to also consider if there was fault in how the Council undertook its assessments.

Findings on matters investigated

37. My investigation focuses instead on the Council’s benefit administration and related matters. I consider first how the Council administered Ms C’s claims for housing benefit and council tax support over around a four month period between August and November 2018.
38. Ms C quickly realised she would not receive help with her rent and council tax further to the Council’s decision of mid-July 2018. She repeatedly contacted the Council and gave it information necessary to review that decision. But there was fault in how the Council dealt with those contacts.

• First, it did not scan all the documents she provided in late July 2018. Crucially it failed to scan a cash-flow projection giving different figures to those Ms C provided at the beginning of her self-employment.
• Second, this meant it re-assessed of Ms C’s housing benefit and council tax support in late July 2018 without that cash-flow projection. It did not notice its failure to scan that document which Ms C had referred to in a covering email.
• Third, it delayed in taking any action in response to information Ms C provided in mid-August, mid-September and October 2018 (when Ms C made a new claim). All of which would inform a re-assessment.
• Fourth, it failed to take any action to resolve Ms C’s claim any sooner despite her repeatedly chasing it to do so. Its notes do not offer reassurance the Council gave Ms C any timescale when the re-assessment would complete. It failed to pass on her contacts to a benefit service manager as its policy required.

39. But for these faults I consider the Council could have paid Ms C’s self-employed claims for housing benefit and council tax benefit from the end of August 2018 at the latest. The injustice the Council caused Ms C beyond this date was twofold. First she experienced uncertainty in not knowing what was happening with her claim, which we consider a form of distress. Second Ms C experienced more time and trouble in trying to resolve her claim. That injustice lasted for around two and a half months before the Council reassessed Ms C’s claim, significantly in her favour, in mid-November 2018.
40. I also have specific concerns about some of the Council’s communications with Ms C during this time. I list these as follows:

• Twice, in July 2018 the Council simultaneously issued decision notices saying Ms C would not qualify for benefit and letters inviting her to provide further information. I accept the Council works with an IT system which prevents it issuing a tailored letter to each claimant. But it could have amended the letters sent to Ms C to make it clearer why it requested further information from her.
• The note of the telephone conversation the Council had with Ms C in mid-September 2018 makes little sense. It suggests the Council wanted Ms C to provide a ‘full year’ of self-employed records, which she clearly could not do.

41. I consider these poor communications also justify a finding of fault. They too will have added something to Ms C’s uncertainty, time and trouble.
42. I do not consider the Council’s collection of council tax during this four month window can escape criticism either. Ms C’s contacts in September 2018 alerted the Council she was seeking a reassessment of her council tax support. She also clearly indicated being on a low income yet still willing to make some payments. Yet I find no evidence the Council considered use of its interim payment procedure. I am grateful to the Council for reminding relevant staff of this procedure. But this was still a fault.
43. I do not find this led directly to Ms C’s summons for non-payment as that followed around two months after the Council reassessed Ms C’s council tax support in mid-November. As noted above, that reassessment went significantly in her favour. But the Council’s failure to respond more sympathetically to Ms C’s circumstances, in line with its policy, will also have added to her distress. Although in considering the impact of this I do also give credit to the Council for its later decision to waive the summons costs applied to Ms C’s council tax account.
44. I turn finally to the Council’s complaint handling, where I also have concerns as follows:

• The delay in answering Ms C’s query about her service charges raised in March 2019 but not answered for over two months.
• The response on the service charge point was unclear. But I am grateful for the Council now reconsidering this.
• The Council gave the impression it had a blanket policy of not considering compensation requests. We use the term ‘financial remedies’ instead. Our published guidance on remedies explains that good administrative practice requires the Council should consider if a complaint merits a financial remedy if upheld. There are many examples where this can be appropriate. Whether the complainant asks for it or not we expect councils to consider if it should pay a financial remedy towards a complaint. We do not expect complainants to have to come to this office to seek financial redress when merited. I am grateful for the reassurance the Council has provided that this impression was incorrect.

45. These concerns also justify a finding of fault. The delay and responses added further to Ms C’s time and trouble.

Agreed action

46. The Council accepts the findings set out above. To remedy the injustice identified in paragraphs 39, 41, 43 and 45 it has agreed to:
1. apologise to Ms C, accepting the findings of this investigation;
2. pay Ms C £250 (£150 for Ms C’s distress and £100 to reflect the time and trouble the Council’s faults put her to); and.
3. make the discretionary housing payment referred to in paragraph 33.
47. The Council will complete the actions set out in paragraph 46 within 20 working days of this decision.

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Final decision

48. For reasons set out above I uphold this complaint. I find fault by the Council causing an injustice to the complainant. The Council has agreed action providing what I consider is a fair remedy to the complaint. I can therefore complete my investigation satisfied with the outcome.

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Investigator's decision on behalf of the Ombudsman