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London Borough of Richmond upon Thames (21 001 048)

Category : Benefits and tax > Housing benefit and council tax benefit

Decision : Upheld

Decision date : 20 Oct 2021

The Ombudsman's final decision:

Summary: Mr X complained the Council took deductions from his Housing Benefit from October 2016 at the same time the Department of Work and Pension took deductions. Mr X also complained the Council incorrectly reduced his Housing Benefits from April 2019 to February 2020. The Mr X says the Council’s action caused his landlord to threaten repossession of his flat and caused him stress, anxiety and financial hardship. The Ombudsman found fault with the Council for taking deductions at the same time as the DWP. The Ombudsman also found fault with the Council incorrectly reducing Mr X’s housing benefits and for the delays in responding to Mr X’s complaints. The Council agreed to the Ombudsman’s recommendation to refund Mr X his overpayments of £828.24 and pay him £1,500 for the prolonged distress, anxiety and financial hardship caused.

The complaint

  1. Mr X complained the Council took deductions from his Housing Benefits from October 2016 at the same time the Department of Work and Pensions (DWP) took deductions from his pension for a previous overpayment.
  2. Mr X also complained the Council reduced his Housing Benefits incorrectly from April 2019 to February 2020.
  3. Mr X says the doubled-up deductions and reduction to his housing benefits caused his rental account to go into arrears. Mr X says this caused his landlord to threaten repossession of his flat and court action.
  4. Mr X also complained the Council took 86 weeks from the date of his complaint to provide a Stage 2 complaint response. Mr X says the Council’s delays caused him stress, anxiety and financial hardship.

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What I have investigated

  1. I have investigated Mr X’s complaints about the Council and DWP duplicating deductions from his housing benefits and pension. I have also investigated the Council’s actions, and impact on Mr X, around taking the incorrect housing benefits from April 2019 to February 2020.
  2. I have not investigated Mr X’s complaint about the amount of housing benefit Mr X should have paid compared with what the Council says he should have paid. I have explained this within the section of this decision titled “Parts of the complaint that I did not investigate”.

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The Ombudsman’s role and powers

  1. 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)
  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

  1. I have considered all the information Mr X provided. I have also asked the Council questions and requested information, and in turn have considered the Council’s response.
  2. Mr X and the Council provided comments on my draft decision. I considered their comments before making my final decision.

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What I found

Housing Benefit-The Law

  1. Housing benefit helps people on low incomes to pay their rent. It is a means-tested benefit, taking both capital and income into account. Depending on the claimant’s means the benefit might not meet their entire rent amount. If this is the case the claimant is responsible for making up any shortfall.
  2. Housing benefit can be paid direct to Landlords at the request of the Claimant. However, the Claimant remains responsible for paying their rent.
  3. Claimants are responsible for ensuring they update the Council with any changes in their circumstances, failure to do so can affect the housing benefit paid.
  4. If the Council reviews a claim and decides it has paid too much benefit, this is an overpayment which the Council is entitled to recover in most circumstances.
  5. The Council must make decisions in writing. The notice must also advise claimants of their rights to ask for more information and to appeal.

Council’s corporate complaints procedure

  1. The Council’s complaint process says it will acknowledge a complaint within two working days and provided a formal Stage 1 response within 15 working days.
  2. The Council says a person can appeal a Stage 1 complaint response and move to Stage 2 of its complaints process. The Council says a person should appeal a Stage 1 response within 20 working days.
  3. The Council’s complaint process says it will acknowledge an appeal request within two working days and provide a formal Stage 2 response within 25 working days. The Council says it will let a person know if it cannot reply within this timescale.

Our guidance on remedies

  1. We expect bodies in jurisdiction to treat people fairly and with respect, and not to expose the public to unnecessary distress, harm or risk as a result of their actions or inactions. Such injustice cannot generally be remedied by a payment, so we usually seek a symbolic amount to acknowledge the impact of fault on the complainant. The amount depends on the circumstances of the case.
  2. When we assess distress, we consider the complainant’s individual circumstances (such as their state of health and age). In reaching a view on remedy we will consider all the circumstances including:
    • the severity of the distress;
    • the length of time involved;
    • the number of people affected (for example, members of the complainant’s family as well as the complainant);
    • whether the person affected is vulnerable and affected by distress more severely than most people; and
    • any relevant professional opinion about the effects on any individual.
  3. A remedy payment for distress is often a moderate sum of between £100 and £300. In cases where the distress was severe or prolonged, up to £1,000 may be justified. Exceptionally, we may recommend more than this.

What happened before October 2016

  1. In August 2008, Mr X split with his partner but did not tell the Council. The Council provided Mr X with an overpayment of his housing benefit from August 2008 to November 2009 totalling £3,629.64.
  2. The Council invoiced Mr X for the housing benefit overpayment. Mr X agreed to repay the housing benefit through deductions from his pension by the DWP in December 2009.
  3. The DWP took payments totalling £638.10 from December 2009 to August 2012.
  4. The Council granted Mr X housing benefits again in August 2012. The Council arranged to recover the previous overpayment through his housing benefits. Both the Council and DWP took deductions from 8 August 2012 to 28 August 2013. This reduced the overpayment to £1725.44.
  5. The Council recognised it should not have taken deductions from Mr X’s housing benefit and paid £719.05 to Mr X’s landlord in September 2013 and stopped deductions. Mr X’s outstanding overpayment increased to £2348.04 by the end of September 2013.
  6. From October 2013 to October 2016 only the DWP took deductions from Mr X’s pension for the previous overpayment. By October 2016, Mr X owed £1073.09.
  7. By 27 September 2016 Mr X’s rent arrears for his rental property was £237.36 every four weeks following payments of his housing benefit from the Council.

What happened from October 2016

  1. The Council started to take deductions from Mr X’s housing benefits for the remaining overpayment on 19 October 2016. The Council did this despite the DWP continuing to take deductions from Mr X’s pension.
  2. On 27 October 2016, Mr X’s landlord sent Mr X a reminder to pay his rent arrears of £281.76. Mr X’s rent arrears started to increase because of the Council’s deductions from his housing benefits.
  3. Mr X contacted the Council to dispute the deductions from his housing benefit in December 2016. The Council’s records show it contacted the DWP on 15 December 2016 to ask it to return the debt to it and stop deductions. The DWP failed to return the debt and continued to take deductions from Mr X’s pension.
  4. In December 2016, Mr X’s landlord sent Mr X a further reminder to pay his rent arrears. Mr X’s landlord sent a notice seeking repossession of Mr X’s flat on 25 January 2017 for the outstanding balance of £414.96.
  5. Mr X contacted the Council on 26 January 2017 and 17 February 2017 to query the deductions. The Council asked Mr X to provide evidence the DWP was still taking deductions on 26 January 2017. The Council sent a letter to Mr X following the visit on 17 February 2017 explaining his housing benefit and council tax reduction entitlement. The Council did not stop the duplicated deductions at this time.
  6. Mr X paid his landlord extra to reduce his rent arrears to £112.63 by 14 February 2017. Mr X’s rent arrears started to increase again from this point until August 2017.
  7. Mr X contacted the Council again in August 2017. The Council contacted the DWP on 2 August 2017 and asked it to stop the deductions from Mr X’s pension and confirmed this with Mr X.
  8. The DWP stopped deductions from Mr X’s pension from 18 September 2017. Mr X’s rent arrears started to decrease from September 2017.
  9. The DWP started taking deductions from Mr X’s pension again from 13 February 2018.
  10. Mr X contacted the Council on 28 February 2018 to query the duplicated deductions. Mr X remained in contact with the Council from this date, but both the DWP and Council continued to take deductions. Mr X’s rent arrears also started to increase again.
  11. Mr X’s landlord sent reminders to Mr X to pay his rent arrears in December 2018 and March 2019 because of the increased rent owed.
  12. Mr X’s landlord sent notice to the Council on 19 March 2019 that he would increase the rent for Mr X’s flat from 8 April 2019 to £177.34 per week.
  13. The Council then received notice about rental charges of a lower amount per week for Mr X’s former partner, at a different address, starting 1 April 2019.
  14. On 1 May 2019, the Council used Mr X’s former partner’s rental rate to calculate Mr X’s housing benefit payment rather than Mr X’s rental rate. The Council reduced Mr X’s housing benefits and decided it had overpaid Mr X £130.55 from 1 April 2019 to 5 May 2019.
  15. Mr X appealed the Council’s decision about his housing benefit deduction and queried the duplicated deductions by the DWP and Council.
  16. Mr X’s landlord sent increasing demands for payment due to the increasing rent arrears. By the end of July 2019 Mr X’s rent arrears had increased to £965.55. Mr X’s landlord sent him a notice seeking possession of the flat, a pre-court appointment notice and a court application seeking possession of the flat due in July 2019.
  17. Mr X complained to the Council on 25 July 2019. Mr X disputed the Council’s calculations of his housing benefit and queried why both the DWP and Council were taking deductions for the same historic overpayment.
  18. The Council told Mr X the overpayment calculation was correct on 25 September 2019. The Council did not address Mr X’s concerns about the duplicated deductions.
  19. On 30 October 2019, Mr X wrote to the Council again to raise the same concerns from 25 July 2019.
  20. By 15 November 2019, Mr X’s rent arrears had increased to £1,195.04 and his landlord sent him a further pre-court appointment notice.
  21. The Citizens Advice Bureau (CAB) wrote to the Council on Mr X’s behalf on 29 November 2019 to chase a response to Mr X’s complaint on 30 October 2019.
  22. The DWP stopped taking deductions from Mr X’s pension on 6 January 2020 when it considered Mr X had settled the full balance.
  23. Mr X complained the Council again on 20 January 2020.
  24. The Council investigated Mr X’s complaint on 10 February 2020. The Council found it had used the wrong rental amount to calculate Mr X’s housing benefits from April 2019. The Council recalculated Mr X’s housing benefits from 1 April 2019 to 9 February 2020 and posted a payment of £1,094.40 to Mr X’s landlord. The Council also amended Mr X’s housing benefit moving forwards. This payment reduced Mr X’s rental arrears to £135.08. The Council also accepted that both the Council and DWP should not have been taking deductions and stopped the Council’s deductions from Mr X’s housing benefits. The Council sent a Stage 1 complaint response detailing the above.
  25. The Council contacted Mr X’s landlord on 12 February 2020 to confirm its error and to advise about the backdated housing benefit payment.
  26. Mr X responded to the Council’s Stage 1 complaint response on 20 February 2020. Mr X said the Council had taken £863.04 too much from him in overpayments due to the duplicated deductions from the Council and DWP. Mr X also said his landlord had threatened him with court action and eviction because of the Council’s actions and he wanted compensation.
  27. The Council accepted Mr X’s complaint on 21 February 2020 but failed to respond to this as a formal complaint. The Council instead treated Mr X’s contact as a appeal of his housing benefit.
  28. Mr X contacted his councillor and MP about the lack of response from the Council. His councillor contacted the Council on 24 September 2020 followed by his MP on 1 October 2020 to chase a response.
  29. The Council provided its Stage 2 complaint response on 4 December 2020. The Council said:
    • Both the DWP and Council took deductions from Mr X’s pension and housing benefits, respectively, causing a total repayment amount of £4,457.28 for the overpayment of £3,629.64. This meant Mr X repaid £827.64 too much which the Council needed to return to Mr X.
    • It had missed opportunities to address Mr X’s concerns and accepted this caused Mr X a shortfall in his benefits contributing to the rent arrears.
    • It had incorrectly calculated Mr X’s housing benefits from April 2019 but had now corrected this by posting a payment to Mr X’s landlord for the underpayments it had made.
    • It would pay Mr X £827.64 for Mr X’s overpayments and £275 in compensation.
  30. The Council wrote to Mr X on 26 February 2021 and 24 June 2021 asking for his bank details so it could repay the money owed to him. On 24 June 2021, the Council said the overpayment Mr X made was £828.24. Mr X has not provided these bank details so far.

Analysis

Duplicated deductions

  1. Mr X complained the Council took deductions from his Housing Benefits from October 2016 at the same time the Department of Work and Pensions (DWP) took deductions from his pension for a previous overpayment.
  2. There is no dispute over the overpayment in housing benefits in 2009 or the Council’s entitlement to recover this overpayment from Mr X.
  3. Mr X agreed with the Council and DWP for the DWP to recover this overpayment through deductions from his pension. This was an agreeable repayment method for the historic overpayment to Mr X.
  4. The Council started to take deductions in October 2016 alongside the DWP’s deductions. The Council explained this was because it put in place a new system which meant it missed the DWP deductions from Mr X’s pension and assumed Mr X was no longer repaying the overpayment. The Council did not check with the DWP to see if deductions were continuing. Taking duplicated deductions in October 2016 is fault by the Council.
  5. While the Council contacted the DWP in December 2016 about the deductions this did not resolve Mr X’s complaint. Both the DWP and Council continued to take deductions at the same time until September 2017. The Council failed to stop the duplicated deductions despite Mr X’s contact in December 2016. This is fault.
  6. When Mr X contacted the Council in August 2017 it contacted the DWP and stopped the DWP’s deductions from September 2017. The Council took the correct action in September 2017, I do not find fault.
  7. The DWP restarted collections on 13 February 2018. This is not the fault of the Council but, rather, an action taken by the DWP. This is beyond the remit of the Ombudsman to question.
  8. However, Mr X contacted the Council on 26 February 2018 to query the duplicated deductions. Mr X continued to contact the Council about the duplicated deductions until 10 February 2020 when the Council stopped its deductions from Mr X’s housing benefits. By this point the DWP had stopped taking deductions as it considered Mr X had settled the overpayments. The Council failed to address Mr X’s concerns for nearly two years. This is fault.
  9. Despite Mr X’s contacts, the DWP and Council took duplicated deductions from Mr X’s pension and housing benefits, respectively, for 34 months since October 2016 until January 2020. This caused Mr X financial hardship, distress and anxiety for a prolonged period of time.
  10. The Council has accepted because of the duplicated deductions between itself and the DWP, Mr X has repaid £828.24 too much for the 2009 overpayment. The Council needs to repay this amount to Mr X.

Reducing housing benefits

  1. Mr X complained the Council incorrectly reduced his Housing Benefits from April 2019 to February 2020.
  2. The Council has accepted it incorrectly reduced Mr X’s housing benefits in May 2019 following receipt of Mr X’s former partner’s rental costs. The Council used Mr X’s former partner’s rental costs to calculate Mr X’s housing benefits. The Council did this despite already have received Mr X’s rental costs and his former partner’s rental costs being in the name of his former partner and for a different property. This was fault by the Council.
  3. Mr X contacted the Council on 25 July 2019 to dispute the reduction to his housing benefits. The Council only responded on 25 September 2019 when it advised its decision about his housing benefit was correct. The Council’s failure to investigate and recognise its mistake in September 2019 was fault.
  4. Despite Mr X’s and the CAB’s contacts in October 2019 and November 2019, the Council failed to investigate Mr X’s concerns until his further contact on 20 January 2020. This was fault.
  5. The Council corrected Mr X’s housing benefits moving forwards on 10 February 2020 and paid Mr X’s landlord the underpayments from 1 April 2019 to 9 February 2020. I am satisfied the Council corrected its errors at this time.
  6. While the Council corrected its errors on 10 February 2020, the Council’s fault caused Mr X to experience ten months of underpayment of his housing benefit. This caused Mr X financial hardship, distress and inconvenience.

Impact on rental arrears

  1. Mr X says the doubled-up deductions and reduction to his housing benefits caused his rental account to go into arrears. Mr X says this caused his landlord to threaten repossession of his flat and court action.
  2. Mr X agreed with the Council for it to pay housing benefits directly to his landlord.
  3. The rent arrears on Mr X’s rental property was £237.36 on each payment of housing benefits before October 2016. Since the Council was paying the housing benefits and not taking deductions, this debt was solely the responsibility of Mr X. This is not the fault of the Council.
  4. When the Council started taking deductions from Mr X’s housing benefits, Mr X’s rent arrears began to increase. This prompted Mr X’s landlord to send two reminder letters for the rent arrears, in October 2016 and December 2016, before threatening Mr X with repossession of his flat in January 2017.
  5. The increase rent arrears during this time is a direct cause of the housing benefit deductions. The increase in rent arrears resulted in the debt collection letters sent by Mr X’s landlord. These letters caused Mr X distress and uncertainty over his living situation.
  6. Mr X also decided to pay his landlord extra in January 2017 to reduce the rent arrears to prevent repossession of his flat. This caused Mr X added financial hardship.
  7. The Council caused the injustice Mr X experienced from October 2016 to February 2017.
  8. Mr X’s landlord did not take further action until December 2018. The reason for this is the gap in duplicated deductions from September 2017 to February 2018 reduced Mr X’s rent arrears. However, by December 2018, the restarted duplicated deductions from February 2018 caused Mr X’s rent arrears to increase to a level where Mr X’s landlord felt he needed to chase for payment of debt.
  9. The Council’s fault at taking duplicated deductions again caused Mr X to receive letters chasing payment for the increased rent arrears. This again caused Mr X distress and uncertainty over his living situation.
  10. The Council compounded this issue when it incorrectly reduced Mr X’s housing benefits in May 2019. This caused a sharp increase in the accrual of Mr X’s rent arrears and caused Mr X’s landlord to increase collection action. Mr X’s landlord threatened Mr X with court applications to take possession of the property in July 2019 and November 2019. This caused Mr X distress and anxiety because of the Council’s fault.
  11. Since February 2020, when the Council paid Mr X’s landlord for the underpayments in housing benefits, restored Mr X’s housing benefit payments to the correct amount and stopped the duplicated deductions. Mr X’s landlord has not taken any further collection activity against Mr X.
  12. Mr X has experienced chasers for rent arrears, threats of court action and repossession of his property and financial hardship from October 2016 to November 2019 directly caused by the actions of the Council. This has put Mr X under prolonged and severe distress and anxiety over his living situation for over three years.

Complaint handling

  1. Mr X also complained the Council took 86 weeks from the date of his complaint to provide a Stage 2 complaint response.
  2. The Council’s complaint procedure says it will respond to a Stage 1 complaint within15 working days, three weeks. Mr X raised his formal stage 1 complaint on 25 July 2019. While Mr X had contacted before this, which the Council failed to act on as detailed in paragraphs 63 to 68, Mr X did not raise a formal complaint.
  3. The Council responded to Mr X’s formal complaint on 12 February 2020 after two further chasers from Mr X and a chaser from the CAB. It took the Council nearly 29 weeks to respond to Mr X’s complaint rather than the three weeks outlined in its complaint procedure. This delay of nearly 26 weeks in responding to Mr X’s stage 1 complaint is fault.
  4. The Council’s complaint procedure says it will respond to a Stage 2 complaint within 25 working days.
  5. Mr X raised his formal stage 2 complaint on 20 February 2020. The Council only provided its stage 2 complaint response on 4 December 202. It took the Council just over 41 weeks to respond to Mr X’s complaint rather than the four weeks outlined in its complaint procedure. This delay of slightly over 37 weeks in responding to Mr X’s stage 2 complaint is fault.
  6. In total, the Council delayed for 63 weeks outside its complaint timescale in providing Mr X with a stage 2 complaint response from the date of his first complaint.
  7. This delay added to Mr X’s distress and frustration and delayed the time it took the Council to address the issues detailed in his complaint causing him financial hardship. The Council also failed to respond to Mr X’s stage 2 complaint response on Mr X’s request and only did so following contact from a Councillor and MP on Mr X’s behalf. This added to the time and trouble Mr X was put to in raising his complaint with the Council.

Total injustice Mr X experienced

  1. Mr X experienced a prolonged and severe injustice from October 2016 to December 2020 caused by the fault of the Council.
  2. Mr X experienced financial hardship, distress and anxiety for 34 months from October 2016 to January 2020 caused by duplicated deductions by the Council and DWP.
  3. Mr X experienced further financial hardship and distress from April 2019 to February 2020 due to underpayment of his housing benefit by the Council.
  4. Because of the Council’s fault through duplicated payments and reduction in housing benefit, this impacted on Mr X’s rental situation. Mr X was the recipient of repeated collection letters and threats of repossession of his property from October 2016 to November 2019. The Council’s mismanagement of Mr X’s housing benefits and overpayment deductions caused this situation. This situation stopped as soon as the Council corrected its fault. This has put Mr X under prolonged and severe distress and anxiety over his living situation for over three years.
  5. The Council also delayed for over 63 weeks in responding to Mr X’s complaints and only provided its final response following contacts from a Councillor and MP acting on Mr X’s behalf. This put Mr X under added stress and inconvenience.
  6. Mr X has suffered a prolonged, in total over three years, and severe injustice, through financial hardship, distress, anxiety over his living situation, stress and inconvenience, because of the Council’s actions.

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Agreed action

  1. Within one month of the Ombudsman’s final decision the Council should:
    • Provide Mr X with an apology and payment of £1,500 to address the prolonged and severe injustice her experienced through financial hardship, distress, anxiety over his living situation, stress and inconvenience caused by the faults of the Council from October 2016 to December 2020.
    • Pay Mr X £828.24 for the amount Mr X repaid in excess of the total housing benefits overpayments he owed from 2009.

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Final decision

  1. There was fault by the Council, as the Council has agreed to my recommendations I have completed my investigation.

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Parts of the complaint that I did not investigate

  1. I did not investigate Mr X’s complaint the level of his housing benefits and what he believes is owed as a refund compared to what the Council says.
  2. This is because it is the role of the Social Entitlement Chamber of the First Tier Tribunal to decide complaints about how much housing benefit a Council awards a person. This includes decisions about any overpayments or whether overpayments should be recoverable from a person.
  3. The Ombudsman can consider the Council’s actions surrounding these matters and the impact and injustice this has on a person if the Council has delayed in repaying money owed to a person. However, the Ombudsman cannot determine whether a Council has awarded the correct housing benefits.

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Investigator's decision on behalf of the Ombudsman

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