Decision : Upheld
Decision date : 07 Feb 2020
The Ombudsman's final decision:
Summary: Mrs X complains the Council has repeatedly underpaid her special guardianship allowance since 2012. The Ombudsman has found fault with the Council. The evidence does not support its calculation of an underpayment it says it made to Mrs X, and its refusal to carry out a Stage 2 investigation did not comply with the law. This caused Mrs X a significant injustice in the form of frustration, uncertainty and put her to the time and trouble of complaining to the Ombudsman to get the independent investigation she was entitled to.
- Mrs X complains the Council has repeatedly underpaid her special guardianship allowance since September 2012. She says she only became aware of this in late 2018, when payments unexpectedly stopped and she complained. Although the Council made a further payment to Mrs X, she believes it has significantly underestimated the amount it owes her.
What I have investigated
- I have investigated events in respect of payments made to Mrs X since a special guardianship court order in 2012.
- A complaint about events dating back that far is a late complaint. I have chosen to exercise our discretion to investigate it because Mrs X was not aware until recently of any need to complain. There is good reason to investigate now as any injustice caused by financial underpayment is likely to be continuing. There are clear records of what happened, and I am satisfied, having made enquiries, there is enough evidence available for me to make a sound decision.
The Ombudsman’s role and powers
- We cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, as amended)
- 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)
- 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 with Mrs X and read documents she sent in support of her complaint. I wrote to the Council with enquiries and reviewed the information it sent in response.
- I have shared my draft decision with Mrs X and the Council and I invite them to comment on it.
- Under the information sharing agreement between the Local Government and Social Care Ombudsman and the Office for Standards in Education, Children’s Services and Skills (Ofsted), we will share this decision with Ofsted.
What I found
- Before 2012, Mrs X looked after a child related to her for the Council and received a financial allowance from it as a result. This carer’s allowance was the national fostering allowance plus an extra weekly amount towards holidays and birthday and Christmas presents.
- In 2012, Mrs X applied for a Special Guardianship Order (SGO). This meant the child would not longer be a looked after child and Mrs X would take on parental responsibility. A draft support plan written by the Council from before the Order started says, “the special guardian will have her current (kinship) fostering payment converted to a Special Guardianship allowance in the sum of £156.15”. The draft plan also confirmed payments would increase in line with the national minimum fostering allowance set by the government.
- The Council also filed a position statement to the court considering the SGO in 2012. This said, “the [Council] will pay the sum of £156.15 on the making of the Special Guardianship Order”. The court agreed the SGO. The order included a paragraph recognising Mrs X disputed whether the Council should deduct child benefit from the allowance and said, “she may seek to judicially review” such a decision.
- The Council wrote to Mrs X on 20 September 2012. The letter said, “…you will receive a Special Guardianship allowance in place of the fostering payment. This will be at the 2012 rate though a deduction will be made for child benefit as you can now claim this yourself… In future, therefore, your payment will be £156.15 a week, less child benefit of £13.40 = £142.75”. The Council also provided evidence to the Ombudsman which is a handwritten internal payment form dated the same day which mirrors the content of this letter.
- In late 2018, the Mrs X says the Council told her it intended to reduce her special guardianship allowance. She asked the Council to explain how it had worked out her allowance and says the Council eventually explained it had been taking off child benefit. However, Mrs X believed the figures did not add up if that was the case. She also pointed out the Council had previously agreed to pay the holiday, birthday and Christmas supplement too but was now saying it did not pay it to special guardians.
- In January 2019, the Council wrote to Mrs X. Its letter confirmed the court order stated it should not deduct child benefit. It said it would backdate an increase to include child benefit to late 2018 when it first removed it.
- Mrs X was unhappy with this response and complained. The Council recognised Mrs X’s complaint was a statutory children’s services complaint. The Children Act 1989 says councils must follow a formal representations or complaints procedure to deal with complaints by and for children and young people about specific functions. The law sets out a three-stage process, escalating from a local resolution, to an investigation overseen by an independent person and then finally a review panel.
- The Council responded to Mrs X at Stage 1. It said it did not have records back to 2012 to show how it worked out payments. However, based on the local core fostering allowance it believed it had underpaid her by around £1,300 over that period. It worked out the underpayment by comparing the core fostering allowance with the amount paid to Mrs X. For example, in 2012 when the SGO came into force it paid her £142.75 a week but the core fostering allowance was £145. The Council therefore concluded it had underpaid her by £2.25 per week during that financial year. It then repeated the same calculation for future years.
- The Council wrote to offer to pay around £1,300 to Mrs X. However, she was still unhappy as she felt the figures provided by the Council did not make sense. Mrs X wanted to go to Stage 2 of the statutory complaints process. The Council considered her request but decided not to carry out a standard Stage 2 investigation. It initially told Mrs X a Stage 2 investigation could “take up to 65 working days. Two independent investigators have to be appointed.” It explained the process and that the law said an ‘Alternative Dispute Resolution’ meeting can take place between stages. It offered Mrs X a meeting but said, if that did not resolve the complaint, “…you can still proceed to a Stage 2 investigation.”
- After further contact between Mrs X and the Council, it decided instead of advancing to Stage 2 it would instead ask its “internal audit team to conduct an independent audit” of the payments in her case. Mrs X expressed dissatisfaction with this and felt the Council was delaying. She asked the Ombudsman to intervene, but at that point we asked the Council to complete its own investigation and provide its final response.
- The Council wrote to Mrs X around six weeks later with the result of the audit. It said this showed it had made an error in its Stage 1 calculations and owed Mrs X around £80 more. Mrs X questioned whether the auditors knew about the court order, but the Council assured her they did. It directed Mrs X to the Ombudsman if she was still unhappy.
- Mrs X complained to us again. She believes the Council has underpaid her since 2012 by not applying the correct rate. She says she made Freedom of Information Act requests which showed the payments to her did not match the allowances it claimed to pay foster carers. Mrs X wanted a full Stage 2 investigation to get to the truth of what happened.
- In response to our enquiries, the Council confirmed the core fostering allowance in 2012 was £145 per week. It said the holiday, birthday and Christmas supplement in the same year was £11.15 per week. Child benefit was £13.40 per week that year. It has provided figures for most of the other years in the period between 2012 and 2018.
- The Council now says the letter it sent to Mrs X in January 2019 was wrong to say the court ordered it not to deduct child benefit. Its position is it could always do this. It says it “believes that [Mrs X] was originally paid the correct amount but took the decision to pay back the child benefit deduction due to the confusion about the court order” on her part.
- It told the Ombudsman it felt the auditors in its finance team were the most suitable to investigate instead of arranging a standard Stage 2 investigation. It says even if it was fault to take that approach, Mrs X suffered no injustice as the result was quicker and it told her of her right to complain to the Ombudsman.
- Mrs X’s complaint to the Ombudsman is that the Council underpaid her Special Guardianship allowance between late 2012 and 2018. I used the documents she provided, along with the Council’s own evidence, to build a picture of how the Council worked out her allowance.
- It is clear to me, from both the documents in 2012 and the figures provided by the Council for the years since then, Mrs X’s weekly allowance was made up of three different amounts:
- The national core fostering allowance.
- Plus the holiday, birthday and Christmas supplement.
- Minus child benefit.
- So, for example, in 2012/13 the Council says it paid Mrs X £142.75 per week. The evidence strongly suggests this is the £145 core fostering allowance, plus £11.15 holiday, birthday and Christmas supplement, minus £13.40 in child benefit. The same applies to the following years.
- In its Stage 1 investigation the Council concluded it overpaid Mrs X in 2012/13 by working out the difference between £145 and £142.75. It applied the same methodology to the following years. I cannot see beyond this being an error on the Council’s part and therefore fault. When it asked its auditors to look at the calculations it did so by simply asking them to check the officers’ work at Stage 1. There is no evidence it allowed them to look afresh at the evidence and to reach their own conclusion.
- I put my own calculations to the Council along with the supporting evidence. It suggested it does not agree with my view but has not provided any calculations of its own to disprove it. Other than reiterating its position, it could not explain why I am wrong.
- I find its stance confused and contradictory. For example, it categorically states it does not pay the holiday, birthday, Christmas supplement to special guardians. Yet its own payment records and documents from around the time the court order came into force show it did just that for Mrs X. A paper it wrote before the 2012 court hearing suggests that was a deliberate choice on its part.
- It is also difficult to understand the Council’s previous position on child benefit deductions in this case. It no longer stands by the letter it sent to Mrs X in January 2019 and now says it was entitled to deduct child benefit from her allowance since 2012. On the wording of the court order, and the normal local authority approach to Special Guardianship allowances, I agree. The SGO itself says Mrs X reserved the right to take legal action if that was what the Council did. Its records suggest it has consistently deducted child benefit from the allowance since 2012.
- The Council says the payment it made to Mrs X after its complaints process was the child benefit it had deducted. However, its own figures and the auditor’s calculations do not support that position. The amount of the child benefit payment, which has varied since 2012, does not equal the amount it repaid. At Stage 1, the Council instead described the £1,300 it intended to pay Mrs X as an ‘underpayment’. That term clearly means money it should otherwise have paid but had not. Yet in response to the Ombudsman it now says it believes it paid her the right amount in the first place.
- Having reviewed the figures in this case, there is no evidence of an underpayment to Mrs X between 2012 and 2018. The Council has chosen to voluntarily pay Mrs X just under £1,400. It stands by that decision, saying it did it because of her confusion about the court order. While I consider the Council’s rationale for making that payment questionable, any attempt by it now to reclaim those funds from Mrs X would almost certainly be fault.
- I have also considered the Council’s approach to the statutory children’s complaint procedure. Although I have questioned the calculations produced by the Stage 1 investigation, the process itself was not fault. A suitable officer looked into Mrs X’s complaint in a timely manner. However, once the Council identified an underpayment, it should have arranged to pay it automatically to Mrs X rather than make it subject to her acceptance. It had her payment details already for paying her the Special Guardianship allowance.
- There was however fault in the Council’s decision not to carry out a Stage 2 investigation following the statutory procedure. The law allows the Council’s complaints manager to use a limited amount of discretion in resolving a statutory children’s complaint. However, the Council seems to have decided this complaint was not suitable for a standard Stage 2 investigation and stuck to that rigidly. When it failed to convince Mrs X, and she insisted on going to Stage 2 as is her right, it continued with its intended approach anyway.
- The statutory guidance explaining the statutory children’s complaints procedure specifically includes “financial support for Special Guardians” as a topic that can be the subject of a complaint. The Council was misguided in concluding the nature of the complaint – one about financial allowances rather than social care decisions – meant it would be better looked into by its finance team exclusively.
- The Council’s approach was fault. It should have continued to Stage 2 and followed the standard procedure. The statutory guidance is clear it was Mrs X’s choice and the Council was wrong to decide the work of the auditors after Stage 1 removed the need for a Stage 2 investigation. I also considered the suitability of a social worker to investigate Mrs X’s complaint. While the complaint may well have benefited from input from a financially minded person, I cannot see any clear reason why a social worker could not have asked for that support when and if required. The failure to carry out a compliant Stage 2 investigation meant no complaint statement was taken from Mrs X and no independent person was involved as required by the law to provide oversight. Neither was a formal report produced, nor the findings sent to a senior officer to formally adjudicate and provide the Council’s response. Any opportunity to proceed to Stage 3 was also lost.
- Contrary to the Council’s submission to the Ombudsman, I conclude its approach caused a significant injustice to Mrs X. The Council certainly caused her frustration and uncertainty. The statutory procedure exists for a reason. She knew something was wrong with the Council’s calculations but did not have the opportunity to put her case to an independent investigator. It also put her to the time and trouble of having to approach the Ombudsman twice to make sure the Council did as the law requires. While the Council should apologise to Mrs X for this, as she is not out of pocket financially, I am satisfied no further financial remedy is needed beyond that already paid to her.
- Within one month, the Council will write to Mrs X and apologise for its decision to not follow the proper statutory process by arranging for a Stage 2 investigation to take place.
- Within one month, the Council will ensure all officers involved in overseeing statutory children’s complaints are aware of the need to continue to Stage 2 if that is the complainant’s clearly stated aim.
- Within two months, the Council will task a senior officer not previously involved to review all refusals to proceed to Stage 2 of the statutory complaints process in 2019. They should make sure each refusal complies with the statutory guidance and the Ombudsman’s decision in this case. If any do not, the Council should take steps to reopen those complaint investigations if the complainant wishes it to.
- The Council will write to the Ombudsman to confirm when it has completed these actions.
- While there is no evidence of any underpayment of Mrs X’s Special Guardianship allowance, there was fault in how the Council worked out an underpayment it believes it was responsible for. There was also fault in the Council’s refusal to carry out a Stage 2 investigation under the statutory children’s procedure. Only the latter fault caused an injustice to Mrs X.
Investigator's decision on behalf of the Ombudsman