Summary: The Council was not at fault for how it decided Mr X’s special guardianship allowance. Its approach to deciding allowances appears in line with its statutory responsibilities.

The complaint

1. Mr X looks after his grandson, Y, under a special guardianship order. He complains that:
• The Council unfairly reduced his special guardianship allowance, which it should not have done because he is on benefits.
• In reducing his allowance, the Council erroneously made the same deduction twice.
2. Mr X says this matter has caused him a financial injustice. He wants to receive the full allowance, minus deductions, and wants any deductions made in error to be refunded.

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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. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and s34H(1), as amended)

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How I considered this complaint

4. I considered evidence provided by Mr X and the Council as well as relevant law, policy and guidance.
5. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments before making a final decision.

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What I found

Law, policy and guidance

6. In 2017, the government issued statutory guidance to councils on how to support special guardians and the children they look after.
7. The guidance says that, when deciding the level of a special guardianship allowance, a council should have regard to the amount of fostering allowance it would have paid if the child were fostered instead.
8. The council must also take into account other benefits the special guardian receives. A special guardianship allowance must not duplicate financial support available through the state benefits system.
9. In 2005, the government also issued a means test model to assist councils to work out adoption and special guardianship allowances. This model was non-statutory, but it made recommendations to achieve a fair and consistent approach by councils.
10. The model recommended that, when a special guardian or adopter’s only income was income support (which has since been replaced by universal credit), councils should pay them the maximum allowance without assessing their income and without making any deduction for child benefit.
11. In a recent case (23 019 787), we made enquiries of the government about its means test model. It confirmed that the model is now out of date. It has not been updated since 2005 and is no longer supported or promoted by the government. However, it remains available for councils to use voluntarily if they wish.
12. The Council’s policy on special guardianship allowances says it pays allowances at its fostering rate, minus the current rate of child benefit (which special guardians can claim separately, whereas foster carers cannot). This is also dependent on the special guardian’s financial circumstances, and some guardians may not qualify for the full rate.
13. In 2023/24 (the period during which Mr X began making his complaint) the Council’s gross special guardianship allowance (without deductions) was the same as its fostering allowance. Both (for Y’s age group) were £19 a week higher than the national minimum fostering allowance.

What happened

14. In December 2023, Mr X complained to the Council. He said he got a special guardianship allowance with child benefit deducted. But he was also on benefits. He said the Ombudsman had repeatedly ruled that when a recipient of an allowance is also on means-tested benefits then child benefit should not be deducted. Therefore, he said, he should receive the full allowance.
15. The Council responded in January 2024. It said:
• When Mr X first got the special guardianship order, he was told his allowance would be subject to child benefit deductions, but that, as he could then claim child benefit, the amount he received in total worked out the same as the fostering rate.
• The government’s means test model suggests that no child benefit deductions be made when income support is a family’s only income. Mr X also receives other benefits.
• When the child benefit Mr X receives is added to his special guardianship allowance, it actually amounts to more than the national minimum fostering allowance (as the Council uses higher rates).
• Mr X’s allowance was £218 per week (the Council’s £242 fostering rate minus £24 child benefit).
16. Mr X continued his complaint in October 2024. He made the same complaint he had previously, but also asked why, given the Council’s special guardianship allowance rates were advertised as excluding child benefit, was child benefit then subsequently deducted again?
17. The Council asked an independent investigator to consider Mr X’s complaint. In January 2025, she completed her report. She found:
• Case law confirmed that the government’s means test model provides recommendations only.
• Child benefit deduction is the default for most councils, in line with regulations. And it is in line with the Council’s policy.
• Mr X was told in advance about his child benefit deductions.
18. The investigator did not mention Mr X’s claims about child benefit being deducted from his allowance twice.
19. Although Mr X asked an independent panel to review the investigator’s findings, it agreed that the Council had no statutory duty to disregard Mr X’s child benefit in calculating his allowance.

My findings

20. It is not the Ombudsman’s role to tell councils exactly how they must calculate individual special guardianship allowances. But – however they choose to do so – we expect them to meet the requirements of regulations and statutory guidance.
21. In Mr X’s case, the Council was right to say the government’s 2005 means test model is not compulsory. In fact, our recent enquiries have established that the model is no longer supported by the government. It is entirely up to councils whether they use it.
22. The Council’s reasons for taking a different approach to that of the 2005 model are explained in its policy. They refer specifically to the Council’s statutory obligation not to duplicate state benefits.
23. This approach echoes the requirements of the statutory guidance, and, as a result, I have no reason to find fault with it (or with the Council’s decision to follow this approach in Mr X’s case).
24. Furthermore, the Council’s special guardianship allowance rate is the same as its fostering rate, with child benefit then subsequently deducted. This, again, echoes the requirements of the statutory guidance. It does not support Mr X’s complaint that child benefit is deducted twice.

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Decision

25. The Council was not at fault.

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Investigator's decision on behalf of the Ombudsman