Summary: Mr B complained about the way the Council dealt with his claims for housing benefit and council tax reduction. We found the Council delayed for a year in revising Mr B’s claims once he had provided the necessary information. While the delay (due to the cyber-attack in October 2020) was largely outside the Council’s control, it was service failure which caused Mr B financial hardship and distress. The Council has agreed to pay Mr B £200.

The complaint

1. Mr B complains that the London Borough of Hackney (the Council), in respect of his housing benefit and council tax reduction claims:
• failed to send him a profit and loss declaration form in 2020 to allow him to submit his income details;
• sent him an incomplete form in June 2020 and suspended his claims;
• alleged he had not returned the form in August 2020; and
• failed to contact him after he returned the form again in September 2020.
2. Although the Council reinstated his claims in October 2021 and paid the backdated benefit, the delay caused Mr B significant distress and financial hardship.

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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. 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)
5. 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)
6. 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

7. I have considered the complaint and the documents provided by the complainant, made enquiries of the Council and considered the comments and documents the Council provided. Mr B and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

8. Mr B had been in receipt of housing benefit and council tax reduction for a number of years. He is self-employed. He says the Council usually sent him a form every April to record his profit and loss for the previous year.
9. He didn’t receive one in 2020, so he emailed the Council in June 2020 asking for one. The Council replied two days later saying it had suspended his claims while it waited for him to provide information about his change of circumstance. It asked for bank statements, profit and loss accounts for the last 12 months or a completed self-employed earnings form which it had enclosed. The Council says all the pages of the form are on its records system.
10. In July 2020 the Council received an email from Mr B enclosing bank statements, details of sales and materials, travel expenses and a letter from HMRC.
11. The Council replied at the end of July 2020 saying Mr B had not provided all the information asked for: specifically, he had not completed the earnings form or provided his profit and loss accounts. Therefore, it assumed that he did not qualify for benefit and would send him a notification letter in the next few days.
12. Mr B emailed the Council on 20 August 2020 saying had sent back the requested information including his profit and loss accounts. The Council tried to call Mr B but could not get through. So, it contacted him by email to say it was treating his email as a request for a revision of the decision that he was not entitled to benefit. It requested he complete the self-employed form within 14 days and provide some further documents. It also sent a copy of the request by recorded delivery.
13. The Council received the documents from Mr B on 15 September 2020 and added them to the file.
14. No action was taken before the Council experienced a cyber-attack on 11 October 2020 which affected all its computer systems including the housing benefit ones. It had no IT systems from October 2020 until the end of May 2021. Mr B contacted the Council in November 2020 and April 2021 chasing the assessment of his claim. In June 2021 he submitted a new self-employment form.
15. Mr B complained to us in August 2021.
16. The Council reassessed his claim in September 2021 and paid arrears of housing benefit back to June 2021. It did not reassess his Council Tax reduction until February 2022. The Council has apologised for the delay but says it was unable to do anything until its systems were restored in May 2021 and then it had to work through the backlog.
17. It said that Mr B had been claiming housing benefit as a self-employed person since 2013 and was aware of the need to supply proper profit and loss accounts as a matter of course. It said Mr B did not supply proper accounts and while he sometimes completed the self-employment form the Council often had to chase him up for the complete information.

Analysis

18. There is no statutory requirement for the Council to send Mr B a form to record his self-employed earnings on an annual basis. Mr B has a duty to inform the Council of any changes to his circumstances including his earnings from self-employment. The Council was not at fault for not sending Mr B a form in April 2020.
19. When he asked for one in June 2020 the Council treated this as a possible change of circumstance and suspended his claim while it waited for information. This is standard practice and I have not found fault with the Council’s actions. Its records also show that the complete self-employment form was sent to Mr B.
20. Although Mr B responded to this letter the Council says he did not provide proper accounts and simply gave lists of sales and expenses. Neither did he complete the self-employment form. This was insufficient for the Council to be able to determine his claim and so it determined he was not entitled to housing benefit. This was a decision for the Council to make and Mr B had a right of appeal against it. I have not found fault here.
21. The Council treated Mr B’s next letter as a request for a revision and asked him to provide further information including the self-employment form. By mid-September 2020, Mr B provided sufficient information for his claim to be determined but unfortunately the Council did not make a decision before the cyber-attack took place, meaning it was unable to revise Mr B’s claim for a further year. Neither did it respond to his letters during his period or provide any update on when he could expect the claim to be revised. I accept this situation was exceptional and to a large degree outside of the Council’s control. However, it was service failure which affected Mr B adversely, causing him financial hardship for a significant period of time.

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Agreed action

22. In recognition of the injustice caused to Mr B, I recommended the Council, within one month of the date of my final decision, pays Mr B £200.
23. The Council has agreed to my recommendation.

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Final decision

24. I consider this is a proportionate way of putting right the injustice caused to Mr B and I have completed my investigation on this basis.

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Investigator's decision on behalf of the Ombudsman