Summary: The Council was at fault for the way it calculated Mr X’s housing benefit, resulting in it pursuing him for arrears. The Council has amended Mr X’s rent account and applied the appropriate credits. The Council has also agreed to a financial payment to reflect the distress and uncertainty Mr X experienced.

The complaint

1. The complainant, whom I refer to as Mr X, complains about the Council’s decision to pursue him for rent arrears relating to properties he lived at in 2017. Mr X disputes the arrears.

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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 an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. 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

4. As part of this investigation I considered the information provided by Mr X. I discussed the complaint with Mr X over the telephone. I made enquiries to the Council and considered the response received. I sent a draft of this decision to Mr X and the Council and considered the responses received.

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What I found

5. In January 2017 Mr X approached the Council for homeless assistance. The Council decided it owed him a duty to house him and placed Mr X and his family into temporary accommodation. Mr X moved into temporary accommodation on 22 March 2017 at Property A. His family occupied two rooms in Property A. At this time Mr X was employed.
6. Mr X continued to live in Property A until 7 April 2017 when the Council moved him to Property B. Again this was temporary accommodation and Mr X and his family occupied two rooms in Property B. At the end of March 2017 Mr X lost his job and was unemployed.
7. Mr X and his family moved out of Property B on 28 May 2017 into further temporary accommodation where he is currently living.
8. In March 2019 the Council contacted Mr X asking him to pay outstanding rent owed relating to Properties A and B. This amounted to £913.29. Mr X disputed this and told the Council he believed housing benefit should have covered his rent at these properties. Mr X said he was unemployed and entitled to full housing benefit at this time.
9. The Council’s housing department contacted the Housing Benefit team and asked it to review Mr X’s account to see if the Council should pay him any additional housing benefit for Properties A and B.
10. At the end of July 2019 the Council confirmed it had reviewed Mr X’s housing benefit account and it did not owe Mr X any further housing benefit. The Council also attempted to contact Mr X to arrange a payment plan for the outstanding rent arrears.
11. As Mr X did not pay the outstanding arrears the Council wrote to him in November 2019 saying it was considering outsourcing his debt to a debt collection agency as it could not keep recovery action on his rent account on hold any longer.

Mr X’s complaint

12. In January 2020 Mr X complained to the Council as it was chasing him for rent arrears payment he did not believe he owed. Mr X said he was being threatened with legal action.
13. The Council provided its stage one response on 24 February 2020. The Council said it had reviewed Mr X’s rent accounts from Properties A and B in July 2019 and was satisfied they were correct and the arrears on the accounts remained payable.
14. In April 2020, Mr X asked the Council to consider his complaint at stage two. He said when he moved into Property B he had lost his job and was entitled to full housing benefit. He queried why there were outstanding rent charges for Property B. Mr X asked the Council to amend his rent statements and pay him compensation for pursuing him for arrears he thinks he does not owe.
15. The Council provided its stage two response in May 2020. It apologised for the time take to contact him about the debt but said Mr X still owed £913.29.

The Council’s response to my enquiries

16. After contacting the Council about Mr X’s complaint the Council confirmed it had re-looked at Mr X’s housing benefit entitlement while he lived at Properties A and B.
17. The Council confirmed Mr X’s housing benefit entitlement for these properties was incorrect. It explained this was due to officer error and the way the housing department create rent accounts for families in temporary accommodation.
18. The Council said as Mr X’s family occupied two rooms in Properties A and B it generated rent accounts for each room. The Council’s system is designed to link housing benefit to only one rent account. Consequently only one room was linked at each address so the rent liability figure the Council used to calculate housing benefit was lower than it should have been. The Council said an officer had to manually adjust the rent used and manually credit housing benefit to the second rent account for each property.
19. The Council also said Mr X’s income was too high for him to qualify for housing benefit when the lower rent figure was applied in error (i.e. for one room only) and mistakes were made when calculating his correct housing benefit entitlement. This included an error in recording his earned income before he became unemployed.
20. The Council has now addressed this and applied credits to Mr X’s rent accounts for Property A and B and has sent an amended rent statement. This shows for Property A Mr X owes £378.32 rent for both rooms and for Property B Mr X is £147.12 in credit for both rooms.

Analysis

21. The Council was at fault for the way it calculated Mr X’s housing benefit. The Council has recognised it made mistakes in calculating Mr X’s housing benefit for Properties A and B and has taken action to credit his accounts where necessary. This has significantly reduced the debt Mr X owes to the Council.
22. While I accept the Council has corrected the rent accounts, it should also make a payment to Mr X to reflect the distress, uncertainty and time and trouble he experienced in pursuing this with the Council.
23. When considering an appropriate figure I have considered the gap between the arrears and the Council deciding to pursue Mr X. I have also considered the Council had the opportunity to correct its mistake earlier in July 2019 when it reviewed Mr X’s housing benefit. Had it done so Mr X may not have complained to the Ombudsman. I have also considered the distress, uncertainty and time and trouble Mr X experienced as a result of being pursued for this debt.

Agreed action

24. Within one month of my final decision the Council has agreed to pay Mr X £450 to recognise the distress, uncertainty and time and trouble he experienced as a result of the Council’s failings.
25. The Council has requested the payment be applied to Mr X’s rent arrears and provided has evidence Mr X’s rent account is in arrears. We are agreeable the Council can apply the payment to Mr X’s rent arrears. The Council should ensure it provides evidence to Mr X showing this payment has been deducted from his rent arrears.
26. The Council should provide evidence to us to show it has done this.
27. Within three months of my final decision the Council has agreed to review its processes for calculating housing benefit where a family occupies more than one room or where there is more than one rent account generated. The Council should provide us with evidence it has reviewed its system and details of any changes it makes.

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Final decision

28. I have completed my investigation and found the Council at fault for the way it calculated Mr X’s housing benefit which caused injustice. The Council has agreed to the above actions to remedy the injustice caused.

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Investigator's decision on behalf of the Ombudsman