The Ombudsman's final decision:
Summary: The Council was not at fault for recovering money overpaid to Mr C because of a Council error but it was at fault for doing so in a way which caused hardship and distress.
- The Complainant, Mr C, claims that due to errors made by a Council social worker, Officer S, he received an overpayment of fostering allowance.
The Ombudsman’s role and powers
- We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word ‘fault’ to refer to these. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
- 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)
How I considered this complaint
- I spoke to Mr C. I wrote a letter to the Council asking for further information. I considered the evidence provided by the Council and Mr C and the relevant law and guidance.
- I sent copies of my draft decision to Mr C and the Council and invited comments.
What I found
- Mr C lives with his partner, Ms D, in a rented property in the Council’s area. Mr C’s brother, Mr F, is the father to two children by two different mothers, Ms M and Ms N. In 2015, due to personal difficulties, neither Mr F nor Ms M nor Ms N considered themselves able to look after their children.
- Mr C and Ms D agreed to look after both children, initially for a trial period. During this period, they were paid relative carers allowance of £126 per child (£252 a week total).
- The initial trial period went well. The children thrived and Mr C and Ms D decided to formalise the arrangement by applying for a child arrangement order (CAO) with the Council’s agreement. The order was made by the court in February 2016.
- Once the CAO was in place, Mr C and Ms D were eligible to claim child tax credit and child benefit on the children’s behalf, which they did. This totalled £62.29 per child per week.
- Because of the CAO, they were no longer eligible for relative carers’ support allowance of £126 per child. They were now eligible for Child Arrangement Order Allowance of £63.71 per child per week instead. This, with child tax credit and child benefit, should have brought the total level of state funding to £126 a week per child, (the same as relative carers’ support).
- Officer S told Mr C that she would apply for CAO allowance on the couple’s behalf. She did not do so.
- The couple moved shortly after the order was made. Mr C says, after the move, they no longer received letters from the Council telling them what allowance they were receiving so they did not know they continued to receive relative carers allowance. He presumed that they were in receipt of CAO allowance.
- Mr C says that Officer S did not tell him that the CAO allowance would be less than relative carers allowance. Ms D told the Council, after the mistake came to light, that CAO allowance was less than relative carers allowance.
- In February 2017, Mr C and Ms D approached the Council to apply for bedroom tax relief. When the Council looked into their finances, it discovered the couple had been receiving relative carers allowance, not CAO allowance for the last year resulting in an overpayment of £7600.
- The Council took immediate steps to recover the overpayment. It reduced CAO allowance by £50 a week, £200 a month. Mr D says that he spent hours on the phone to the Council complaining that he could not afford to pay.
- Mr C complains that this caused considerable hardship to his family. He says that their income was cut by £900 a month as follows:
Relative carers allowance
Child support and tax credit
Child support and tax credit
Benefits cap cuts rent support
Council recovers £50 a week
- After four months, the Council reduced the repayment to £25 a week.
- Mr C complained to the Council. He said that it had not been his or Ms D’s error that led to the overpayment. He said that it was unfair that the Council should now ask for repayment.
- The Council investigated Mr C’s complaint and partially upheld it. The Council found Officer S’s error had led to the overpayment. But, it found that the Council had a right to reclaim the money to which Mr C and Ms D had never been entitled.
- However, the Council found that, as the repayments were clearly causing the family considerable hardship, it would refer the matter to the Director of Children’s Social Care. The Director decided to waive the outstanding debt of £6,800.
- Mr C complains to the Ombudsman saying that he wants repayment of the money he has so far repaid to the Council. He maintains that the fault was not his and so it is unfair that the Council should keep the money he has so far repaid.
Was there fault causing injustice?
- The Council has accepted it was at fault in that Officer S should have applied for CAO allowance for Mr C and did not. This fault allowed the overpayment to occur.
- Nonetheless, the Council found that Mr C and Ms D had no right to the money which was public money which the Council had a duty to recover.
- However, because the family could not afford to repay, the Council decided to waive the remainder of the debt.
- I do not find fault with the Council’s reasoning. I do not uphold this part of the complaint.
- However, I do find that, in the circumstances of the case, the Council was wrong to recover the money as fast as it did. Mr C told the Council that he could not afford to repay the amount owing at £50 a week and yet the Council insisted that he should do so for four months.
- On its website, the Council says that it will ‘work together’ with those that owe it money to prevent hardship. It did so, after four months. I find this was fault which caused injustice in that Mr C and Ms D were in increased financial difficulties for four months.
- Within six weeks, the Council should
- Apologise for the distress caused and
- Pay Mr C and Ms D £200 in recognition of it.
- I uphold Mr C’s complaint. I intend to close my investigation.
Investigator's decision on behalf of the Ombudsman