Summary: We have discontinued our investigation into Miss X’s complaint about her special guardianship allowance. The Council has already resolved any injustice she may have suffered. Further investigation would not achieve anything else for her.

The complaint

1. Miss X complains that the Council did not properly assess her finances before deciding her special guardianship allowance. She says it incorrectly deducted the amount she received in child benefit from the allowance, which went against national guidance and a previous Ombudsman decision.
2. Miss X also says that, when the Council then changed its mind and agreed that it should not have been deducting child benefit, it refused to backdate the increased payments for more than a year, although this had been affecting her since 2022.

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The Ombudsman’s role and powers

3. We investigate complaints about ‘maladministration’ and ‘service failure’, which we call ‘fault’. We must also consider whether any fault has had an adverse impact on the person making the complaint, which we call ‘injustice’. We provide a free service but must use public money carefully. We do not start or continue an investigation if we decide there is not enough evidence of fault to justify investigating, or if any injustice is not significant enough to justify our involvement. (Local Government Act 1974, section 24A(6), as amended, section 34(B))

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How I considered this complaint

4. I considered evidence provided by Miss X and the Council as well as relevant law, policy and guidance.
5. Miss 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 said 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. An 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 was receiving income support (which has since been replaced by universal credit), councils should pay them the maximum allowance without assessing their income and without deducting child benefit.
11. The model was suggested for councils’ use in the previous version of the statutory guidance (in 2005). The current statutory guidance, from 2017, does not suggest its use.
12. Furthermore, in 2022 the High Court considered the means test model’s proposed approach of not deducting child benefit, and held that:

“[This] proceeds merely as a recommendation … the force of the recommendation … is necessarily tempered by the language of the Regulations and the statutory guidance … [which] requires that the local authority must take account of any grant, benefit, allowance or resource … which is available to the person … the local authority must also take account of the person's financial resources; in other words, means-testing”. (Becker, R (On the Application Of) v Plymouth City Council [2022] EWHC 1885 (Admin))

13. The Council’s policy, prior to 2025, was to ensure that the total allowance a special guardian received (including child-related state benefits) did not exceed what a foster carer would have received had the same child been in care. This meant the Council deducted the amount special guardians received in child benefit from their allowances.
14. In 2025, apparently as a direct result of Miss X’s complaint, the Council changed its policy. It noted that:

“… the Local Government and Social Care Ombudsman … has upheld several complaints regarding this issue, finding that including Child Benefit in means tests for SGO allowances is unfair and contrary to the intended policy aim of supporting carers to maintain stability for children”.

15. The Council’s new policy says that, if a special guardian is in receipt of full universal credit and is not working, they will not be means tested and will be provided with the full allowance without child benefit being deducted.

Ombudsman decisions

16. In early 2024, the Ombudsman issued a public report into a complaint against Devon County Council (case reference 23 000 973). This is the report to which Miss X refers.
17. In that case, we found that the council was at fault for operating a ‘blanket’ child benefit deduction policy. We said councils should give good reasons for departing from the government’s 2005 means test model.
18. Since then, however – in case reference 23 019 787 (October 2024) – we made enquiries of the government about the 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.
19. In that case, and subsequently in case references 24 003 172, 25 000 888 and 25 022 272, we did not criticise councils for deducting the amount an adopter or special guardian received in child benefit from their allowances.

My findings

20. Councils are entitled to set their own policies on the payment of special guardianship allowances, provided they meet the minimum requirements of the statutory guidance.
21. As Miss X says, the Ombudsman has previously issued decisions on this subject. I have summarised some of those decisions, above, to reflect our position.
22. The Council changed its policy in April 2025 and stopped deducting child benefit from Miss X. It also offered to backdate that decision to April 2024 in recognition of injustice it believes she may have suffered. In response to our preliminary enquiries, it has also offered Miss X £150 to recognise the time and trouble she went to in pursuing her complaint.
23. Miss X thinks the backdating of her allowance should go back to 2022. Her reasoning is that the Council’s previous policy – which did involve her child benefit being deducted from her allowance – was wrong.
24. For the reasons given above, I would be unlikely to find fault with the Council’s former policy (or its decision not to backdate her payments to 2022) were I to investigate further. Our updated position is that councils are entitled to make such deductions. This is supported by statutory guidance, case law and information we received from the government in 2024.
25. This means that any injustice Miss X believes she suffered has been resolved. I could achieve nothing else for her were I to investigate further.

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Decision

26. I have discontinued my investigation.

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Investigator's decision on behalf of the Ombudsman