Summary: Miss Y complains about the Council’s decision to refuse her application for a Discretionary Housing Payment while she was pregnant and caring for a young child. The Ombudsman finds fault by the Council, which caused Miss Y distress and uncertainty. This is because we find the Council failed to consider government guidance on good practice when handling applications, such as Miss Y’s, where the applicant is pregnant and has childcare duties that are a barrier to getting work. To remedy this, the Council has agreed to apologise to Miss Y, make her a payment and make a fresh decision on her application. The Council has agreed to make several service improvements.

The complaint

1. The complainant, who I shall refer to here as Miss Y, complains about the Council’s decision to refuse her application for a Discretionary Housing Payment. She says the Council:
1. failed to tell her she would be affected by the benefit cap. Instead, she says the Council’s housing officer ran a financial check before she started her tenancy agreement, which showed she would be entitled to Housing Benefit and she would not need to pay more than between £100 and £200 per month towards her rent; and
2. incorrectly decided she should look for work to make up the shortfall in rent. Miss Y says she could not look for work because she was pregnant and needed to care for her child who was under one years old.
2. Miss Y says she feels let down by the Council and unsupported as a pregnant mother who had fled domestic violence. She says the situation caused her stress and distress, and it affected her mental health as she could not afford to make her rent payments in full. She was worried about being evicted from her home.

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The Ombudsman’s role and powers

3. 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)
4. We investigate complaints about councils and certain other bodies. We cannot investigate the actions of bodies such as the Citizens Advice Bureau. (Local Government Act 1974, sections 25 and 34A, as amended)
5. 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

6. I considered the information and documents provided by Miss Y and the Council. I spoke to Miss Y about her complaint.
7. Miss Y and the Council had an opportunity to comment on my draft decision. I considered all comments received before making a final decision.

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What I found

Discretionary Housing Payments

8. The Department for Work and Pensions has issued guidance on discretionary housing payments (DHP) (as updated February 2021). This guidance says a council may award a DHP when:

• the council considers the claimant requires further financial assistance towards housing costs; and
• the claimant is entitled to either Housing Benefit or the housing cost element of Universal Credit.

9. The scheme is purely discretionary, a claimant does not have a statutory right to a payment.
10. The Discretionary Financial Assistance Regulations 2001 (as amended) govern the DHP scheme. The Regulations give councils broad discretion. But they must act fairly, reasonably and consistently, and take into account the claimant’s financial circumstances and any other relevant factors when making a decision.

The Council’s published information on DHP applications

11. The Council’s website says it can consider making DHPs to provide extra help with an applicant’s housing costs where Housing Benefit or Universal Credit does not cover the rent in full.
12. It says the Council will:

• look at the applicant’s circumstances to see whether they are eligible for a DHP; and
• consider applications on a case-by-case basis and, if successful, DHPs may be awarded as a one-off payment and/or a series of payments.

The Equality Act 2010

13. The Equality Act 2010 protects the rights of individuals and supports equality of opportunity for all. It offers protection in employment, education, the provision of goods and services, housing, transport and the carrying out of public functions.
14. The Equality Act makes it unlawful for organisations carrying out public functions to discriminate on any of the nine protected characteristics listed in the Equality Act 2010. They must also have regard to the general duties aimed at eliminating discrimination under the Public Sector Equality Duty.
15. The ‘protected characteristics’ referred to in the Act are:

• age,
• disability,
• gender reassignment,
• marriage and civil partnership,
• pregnancy and maternity,
• race,
• religion or belief,
• sex, and
• sexual orientation.

What happened

16. At the end of June 2020, Miss Y moved into private rented accommodation in the Council’s authority area. She moved there with her four children, one of whom was a newborn.
17. Miss Y applied to the Council for a Discretionary Housing Payment (DHP). She said she had been affected by the benefit cap and was unable to financially survive with four children. She said she had recently moved to the area from a refuge where she had been staying after fleeing domestic violence.
18. In August, the Council awarded Miss Y a DHP of £500 per month towards her rent for a six-month period (covering July to December 2020). It told Miss Y, when her DHP comes to an end, she would need to reapply if she still wished to be considered for a further DHP.
19. In November, Miss Y applied again for a DHP. She said she was unable to work as she had a newborn child.
20. In December, the Council awarded Miss Y a further DHP of £500 per month towards her rent for a three-month period (covering January to March 2021).
21. In mid-March 2021, Miss Y applied again for a DHP. She said she was still subject to the benefit cap. She said that she was unable to work as she needed to care for her newborn child, who was under the age of one at the time, and she was pregnant.
22. A few weeks later, the Council wrote to Miss Y to ask her to send it updated Universal Credit information. Miss Y sent this to the Council.
23. In late April, the Council wrote to Miss Y refusing her DHP application. The Council said the reasons for this were because Miss Y:

“applied for DHP due to a shortfall in what you can claim for housing benefit due to the benefit cap. In these circumstances you should be seeking employment which would bring your earnings or hours worked to the level at which you are no longer benefit capped. … If you do not become exempt from the benefit cap, then you will need to cover the shortfall yourself from your income/other benefits. Therefore, we have decided not to award you DHP at this time.”

24. The Council signposted Miss Y to its Housing Options Team if she found she was facing eviction. It provided her with information on how to request a review of its decision.
25. Miss Y replied to request a review of the Council’s decision. She said that she would have no money to pay for food and bills and would struggle to pay her rent in full.
26. A few days later, the Council wrote to Miss Y following its review of its decision. It refused her request for a DHP and upheld its previous decision. It said that, in circumstances such as Miss Y’s where she is affected by the benefit cap, she should be seeking employment to bring her earnings or hours worked to a level that meant the benefit cap no longer applies.
27. At the end of April, Miss Y contacted the Council as she was concerned about being evicted.
28. The next day, the Council told Miss Y that she could apply for DHP, but she would only receive £4. The Council referred Miss Y to her local Citizens Advice Bureau and foodbanks for support.
29. In May, Miss Y’s child was born.
30. In July, Miss Y moved to a different property and began working part-time, which meant the benefit cap no longer applied.

Analysis – was there fault by the Council causing injustice?

31. Miss Y complains about the Council’s decision to refuse her application for a DHP in April 2021.
32. Miss Y says the Council failed to tell her she would be affected by the benefit cap (part a of the complaint). Instead, she says the Council’s housing officer ran a financial check before she started her tenancy agreement, which showed she would be entitled to Housing Benefit and she would not need to pay more than £100 and £200 per month towards her rent.
33. I have considered the Council’s response to my enquiry letter and the supporting evidence provided. It find that it was Miss Y’s local Citizen’s Advice Bureau that carried out a financial assessment and provided her with advice around the benefit cap, which it said Miss Y would likely be affected by. I cannot consider the actions or advice given by the Citizen’s Advice Bureau here as it is not an organisation that falls within the Ombudsman’s jurisdiction.
34. In any case, when Miss Y moved to her property at the end of June 2020, the Council awarded Miss Y a DHP on two occasions followings this, which came to £500 per month (covering the period between July 2020 and March 2021). I do not find Miss Y experienced any significant personal injustice during this time given the Council exercised its discretion to award DHPs during this time period. I do not find the Council at fault here.
35. Miss Y complains that the Council incorrectly refused her application for a DHP in April 2021 by deciding she should look for work to make up for the shortfall in rent (part b of the complaint).
36. The Council told us that it does not have a written policy for handling DHP applications. However, it says that it makes decisions about applications in accordance with Government guidance for DHPs.
37. I have considered this guidance. The Department for Work and Pensions’ (DWP) guidance on DHPs (the Guidance) says: this provides guidance and advice on good practices that should be considered when payment of a DHP is being considered.
38. Annex A of the Guidance provides specific good practice guidance, which is intended to help councils in their decision-making process. However, councils have overall responsibility for how DHPs are administered and paid, considering the impact of the welfare reforms and any other relevant factors.
39. Paragraph 1.15 of the Annex A states: “The government has provided additional funding for DHPs to support claimants affected by the benefit cap who, as a result of a number of complex challenges, cannot immediately move into work or more affordable accommodation.”  The funding for DHPs is specifically aimed at several groups of people who are likely to be affected by the benefit cap, which includes, but is not limited to:
1. individuals or families fleeing domestic abuse;
2. households moving to, or having difficulty finding more appropriate accommodation;
3. women within 11 weeks of the expected week of childbirth; and,
4. households containing a young child, specifically a child aged nine months and under, or a child aged under two years of age where childcare is a barrier to getting work.
40. In Miss Y’s case, she applied for a DHP in March 2021 because she said she needed to care for her nine-month-old child, which was creating a barrier to her finding work. This falls within bullet point d above. She told the Council she was expecting a child and she subsequently gave birth in May 2021; a month after the Council’s refusal decision of April 2021. It is my understanding, therefore, that Miss Y was also within 11 weeks of the expected week of childbirth when the Council made its refusal decision (as per paragraph c above). The DWP Guidance gives an example of good practice in a scenario similar to that of Miss Y. The guidance says: “As [the applicant] has a very young child and the availability and costs of childcare is making it difficult to find work [the council] may decide to award a DHP until either cheaper accommodation is found or she can start work. At which point she may also be able to reclaim some childcare costs and have earnings that are enough to exempt her from the cap.”
41. In her review request, Miss Y said that she had a nine-month-old child and was pregnant. She asked the Council to explain how it expected her to work given her childcare responsibilities and pregnancy. Based on the Council’s refusal decision, I find the Council failed to respond to this point of her review. This is fault. I have not seen any evidence the Council considered whether Miss Y could be offered short-term relief in the form of DHP while she was within the 11 weeks of the expected week of childbirth. The Council’s decision that Miss Y should be looking for work is at odds with the DWP’s Guidance on good practice. I have seen no evidence to explain the Council’s reasons for this or how it arrived at its decision that Miss Y could move into work quickly. This is fault.
42. Miss Y’s pregnancy and maternity are one of the nine protected characteristics under the Equality Act 2010. The DWP’s good practice guidance offers councils advice on how to approach decisions where the applicant is pregnant or has a young a child in the household. In my view, it recognises such applicants have reasons why they may not be able to immediately move into work or more affordable accommodation. It is my understanding that this advice in the Guidance assists councils in understanding how it may make decisions that ensures it has had due regard to it duties under the Equality Act. Given this and my findings around the Council’s decision conflicting with the DWP’s good practice guidance, I find the Council failed to have due regard to its duties towards Miss Y under the Equality Act.
43. The fault identified here caused Miss Y distress and uncertainty. She missed out on having her application considered by the Council in a way that was in line with the DWP’s guidance.
44. In response to questions I asked the Council, it said the Council had been affected by a reduction in funding for DHPs and an increase in demand during the 2021/22 tax year. It said, however, where it considered a case to be a “priority” for help with DHP - due to their circumstances and to prevent homelessness or eviction - then it approved DHPs when it had funding available to do so. It said the majority of cases are referred to the Housing Options team so a full assessment can be undertaken. Without a written DHP policy or guidance, it is not clear how the Council applies this in practice given the Council has said staff are also expected to make DHP decisions using the relevant government guidance. In particular, it is not clear how the referral to the Housing Options team works. The Council’s refusal and review decision letters to Miss Y fail to explain whether its Housing Options team may consider DHPs and the circumstances in which an applicant may be considered a “priority”. This is fault. This cause Miss Y uncertainty.
45. We cannot find that a council has breached the Equality Act. However, we can find a council at fault for failing to take account of its duties under the Equality Act.
46. The Council told us that it did not carry out an Equality Impact Assessment (EIA) before changing its practice on DHPs applications when it experienced a reduction in funding. In the absence of an EIA, I asked the Council to provide details of how it had assessed any potential impact of its change in practice on anyone who was pregnant. However, based on the Council’s response, I understand that it did not carry out such an assessment because it does not have a policy on handling DHP applications. This is fault. The broad purpose of the Public Sector Equality Duty (PSED) is to integrate consideration of equality and good relations into the day-to-day business and decision making of public authorities. It requires equality considerations to be reflected into the design of policies and the delivery of services, including internal policies, and for these issues to be kept under review. Without evidence that the Council assessed the impact of its change of practice on groups with protected characteristics, such as Miss Y’s, I find the Council failed to have due regard to its general duties under the PSED. I have made a recommendation below about action the Council should take to remedy this.

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Agreed action

47. Within four weeks of my final decision, the Council has agreed to:
1. apologise to Miss Y in writing;
2. make a payment to Miss Y of £150 for the distress and uncertainty caused. This payment is in line with the Ombudsman’s published guidance on remedies; and,
3. make a fresh decision on Miss Y’s DHP application from March 2021 in way that is in line with the DWP’s Guidance (see paragraphs 37 to 42). If the Council refuses the application again, it should provide Miss Y with clear reasons for this.
48. Within three months of my final decision, the Council has agreed to make the following service improvements:
1. circulate guidance to staff on handling DHP applications that clearly explains: its change in practice following the reduction in Government funding and its referral process to the Housing Options team. This should include advice on the application of the DWP’s Good Practice Guidance (contained in Annex A) and guidance on decision-making when the applicant has a protected characteristic under the Equality Act 2010. The Council should carry out an appropriate impact assessment, such as an Equality Impact Assessment, to inform this guidance and show how it has assessed the impact of any changes of practice on groups with protected characteristics (see paragraph 46 above); and
2. share this decision with relevant staff.
49. The Ombudsman will need to see evidence that these actions have been completed.

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Final decision

50. I have completed my investigation.
51. I have not decided to uphold part a of Miss Y’s complaint because there is no evidence of fault by the Council causing injustice.
52. I have decided to uphold part b of Miss Y’s complaint because there is evidence of fault by the Council causing her injustice. The Council has agreed to the above recommended actions, which are suitable ways to remedy this.

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Investigator's decision on behalf of the Ombudsman