Summary: Mrs X complained about how the Council handled her housing benefit claim. The Council was not at fault as it gave Mrs X information about her appeal rights and she chose not to use them. Mrs X also complained about how the Council considered the suitability of her temporary accommodation. The Council was at fault. It delayed adding Mrs X’s husband to her housing application which caused her uncertainty. It also delayed considering whether Mrs X could afford to pay her rent. The Council has already apologised to Mrs X and made a suitable offer to address the impact of the delay in considering the affordability of her accommodation. It has agreed to remind its staff they must respond to change of circumstance information promptly.

The complaint

1. Mrs X complained the Council:
• delayed making a new housing benefit decision after her husband moved in with her;
• incorrectly calculated her new housing benefit award;
• delayed in adding her husband to her housing application;
• did not properly consider if she was statutorily overcrowded; and
• did not properly consider if the house was affordable.
2. Mrs X said this meant she has accrued a debt of around £11,000 in rent and other fees and was living in unsuitable accommodation. Mrs X wanted the Council to move her into a larger home.

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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. 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)
5. 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)
6. 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)
7. Mrs X complains about issues that date to November 2018. I have exercised discretion to consider her complaint because the issues have been ongoing.

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How I considered this complaint

8. I have considered:
• all the information Mrs X provided and discussed the complaint with her;
• the Council’s comments about the complaint and the supporting documents it provided; and
• the Council’s policies, relevant law and guidance and the Ombudsman's guidance on remedies.
9. Mrs X 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

Relevant law and guidance

Housing benefit

10. Housing benefit helps people on low incomes to pay their rent. It is a means tested benefit, taking into account both capital and income.
11. If a person’s circumstances change, they must tell the council. The council will place a suspension on the person’s account until they make a new decision. A suspension means the person does not receive any benefit. The Council says it aims to make housing benefit decisions within one month of receiving a change of circumstances notification.
12. Councils must make decisions in writing. The notice must advise claimants of their right to appeal. The claimant can first ask the local authority to 'reconsider' (internally review) its decision. They can then appeal to the independent benefits tribunal (the First-Tier Tribunal).
13. Appealable decisions include:
• the benefit calculation;
• that a person is no longer eligible for housing benefit; and
• that a person must repay overpaid housing benefit.

Homelessness

14. If a council is satisfied someone is eligible, unintentionally homeless and in priority need it will owe them the main homelessness duty. Generally, the Council carries out the duty by arranging temporary accommodation until it makes a suitable offer of social housing or private rented accommodation. (Housing Act 1996, section 193).
15. The law says councils must ensure all accommodation provided to homeless applicants is suitable for the needs of the applicant and members of his or her household. This includes whether it is large enough and whether it is affordable.
16. The main housing duty may end in certain circumstances. This is where the applicant accepts an offer of:
• a fully assured tenancy from a private landlord, including a housing association;
• a private tenancy; or
• a tenancy under the council's housing allocation scheme.

Housing allocations

17. The demand for social housing far outstrips the supply of properties in many areas, particularly in London. To manage the demand, every local housing authority must publish an allocations scheme that sets out how it prioritises applicants, and its procedures for allocating housing. All allocations must be made in strict accordance with the published scheme. (Housing Act 1996, section 166A(1) & (14))
18. The Council's allocation scheme says people accepted onto its social housing list are placed in one of four priority bands (A-D). People who are statutory overcrowded are in band B. People living in temporary accommodation are in priority band C, as are those who are overcrowded. When a property becomes available, people on the social housing list can bid. Priority is given according to the bands and length of time the applicant has been on the list.
19. The Housing Act 1985 sets out two standards for deciding if a person is statutory overcrowded. Both standards count living rooms as ‘sleeping accommodation’. The room standard is breached if two people of opposite sex who are not living together as a couple have to sleep in the same room. It does not include children under ten years of age.
20. The space standard is based on the number of people and the size of sleeping accommodation rooms in a property. Rooms over 110 square foot can house two adults. Rooms 50 to 70 square foot can house ½ person (a child over one and under ten years of age).
21. The Council's policy says homeseekers in temporary accommodation will not be successful in bidding for a property if they fall into rent arrears.
22. The Council maintains a transfer list for people who need to move into other temporary accommodation. People are nominated to the list by Council officers and are given a priority band. There are five bands. Band 1 is for urgent moves; people who are pregnant or have children and have been living in a bed & breakfast for five weeks, or whose lives are at risk. Band 5 is for all households on the list not in other bands. This includes families who are overcrowded. The Council’s temporary accommodation policy says it has discretion to allocate temporary accommodation outside of the bands if necessary.

Discretionary Housing Payments

23. The discretionary housing payments guidance manual issued by the Department for Work and Pensions says a discretionary housing payment (DHP) may be awarded where a council considers a claimant requires further financial assistance towards housing costs and is entitled to either Housing Benefit (HB) or the housing cost element of Universal Credit (UC).

What happened

24. The Council accepted Mrs X was eligible, unintentionally homeless and in priority need and that it owed her the main housing duty under s193 of the Housing Act 1996. It offered her temporary accommodation, which she and her young child moved into in 2016. Mrs X was in band C on the main housing list. From February 2017, Mrs X received housing benefit for the full cost of her rent.
25. Mrs X’s husband moved into her home in November 2018. She submitted a change of circumstances form to the Council’s housing benefit department in late December 2018, including details of his income. The Council suspended her housing benefit while it recalculated her entitlement. Mrs X began accruing rent arrears.
26. In mid-February, the Council made a new benefit decision based on the new information. It found Mrs X husband’s income meant it had overpaid her benefit by almost £1000. It reduced her benefit payments to recover the overpayment and reflect the household’s higher income. The Council sent Mrs X a decision letter that set out how she could appeal its decision. Mrs X did not appeal.
27. In March 2019, Mrs X emailed the Council’s housing department. She told it her husband had moved in and the house was too small for her family.
28. The Council responded the same day to say it would assess if it should add Mrs X’s husband to her application. It said she now owed about £2500 in rent and asked her to set up a payment plan to repay it. Mrs X did not arrange a plan.
29. In late April, Mrs X chased the Council's response. She also said the accommodation was too expensive and her debt was growing.
30. The Council replied to say the amount of housing benefit Mrs X was eligible for was dependent on her income. She was receiving a reduced amount because her household income was too high. It asked Mrs X to pay something towards her rent to reduce the risk she would be evicted.
31. In November 2019, Mrs X complained to the Council. She said her accommodation remained unsuitable. The Council responded in late November to say it accepted her husband was now living with her and the house was overcrowded. It said it would put Mrs X on the temporary accommodation transfer list. It said she now owed about £9,000 in rent and the arrears were jeopardising her ability to bid on social housing properties.
32. In January 2020 Mrs X contacted the Council to complain it still had not added her husband to her housing application. She also said she had been disputing her housing benefit entitlement for months, but the issue had not been resolved. The Council responded the following month to apologise for the delay in adding Mrs X’s husband to her housing application and the distress it caused her. It confirmed it had added her husband to the application.
33. In June 2020, Mrs X contacted the Council to ask about a DHP. The Council said:
• if Mrs X could pay a substantial amount of the £10,000 debt she now owed, it would pay some of the remainder to reduce the arrears to a manageable amount. She would then be able to bid on its social housing list; or
• it would write off the debt entirely and pay her first month’s rent and deposit for a private tenancy.
34. Mrs X responded to say:
• she had restarted paying her rent from mid-June and would continue to pay it;
• she would not accept the Council's offer to help her move into private renting. This would mean the Council had ended its housing duty to her and she did not want that; and
• she had been advised she was statutory overcrowded and should therefore have higher priority for social housing. She asked the Council to review the property’s suitability.
35. Mrs X continued to make one-off payments towards her rent and arrears. However, she did not reduce the total debt.
36. In October 2020, Mrs X complained to the Council again. She said the house remained unsuitable and the Council had said it would not move her unless she paid her rent arrears.
37. The Council responded in early November 2020 to say Mrs X was not statutory overcrowded. It confirmed she was still on the temporary accommodation transfer list but was low priority. It confirmed she would not be able to move into social housing with her rent arrears.
38. In late-March 2021, the Council transferred Mrs X to a two-bed house under its temporary accommodation transfer scheme. In response to my enquiries, the Council said it moved Mrs X even though she had low priority because no one else was available to move into the house.
39. The Council also explained how it decided Mrs X was not statutory overcrowded in the accommodation she complained about:
• the room standard says people are overcrowded if two people of opposite sex who are not in a relationship have to sleep in the same room. Mrs X and her husband did not meet this requirement. Her children were excluded from the calculation as they were both under ten years of age; and
• the size of Mrs X’s living room and bedroom meant the property could house 2.5 people. Mrs X, her husband, and her eldest child were counted as 2.5 people. Her youngest baby was excluded from the calculation as they were under one years of age.

Findings

Housing benefit

40. The Council took six weeks to consider Mrs X’s change of circumstances notification and make a new housing benefit decision. This was slightly longer than the one month it aims for. I do not consider this is sufficient to make a finding of fault.
41. The Council's decision included information on how Mrs X could appeal its calculation. Mrs X says she disputed the calculation with the Council but confirmed she did not appeal. It was reasonable for her to do so as the Tribunal was the body best placed to decide whether the calculation was correct and how much of the overpayment she should repay.

Housing suitability

42. Mrs X began accruing rent arrears in December 2018 after changes to her housing benefit entitlement. In spring 2019 Mrs X told the Council the house was unaffordable. The Council did not carry out an affordability assessment and instead directed Mrs X to its housing benefit team to arrange repayment. It did not consider a DHP until Mrs X asked for one in June 2020. The Council's failure to consider whether Mrs X’s accommodation was affordable or what support it could offer her when she first raised concerns was fault. However, the Council made a suitable offer to address the injustice in June 2020 in the form of a potential DHP, which Mrs X did not engage with.
43. Mrs X told the Council’s housing department about her husband joining the household in March 2019. The Council took eight months, until November 2019, to consider the change of circumstance and decide Mrs X was overcrowded. It then added her to its temporary accommodation transfer list. The delay was significant, but Mrs X was in the lowest priority band so I cannot say that but for the Council’s fault she would have moved to another temporary accommodation. Therefore, the injustice to Mrs X is uncertainty. In its complaint response in February 2020, the Council apologised for the delay and the distress it caused Mrs X. I consider this is a suitable response and no further personal recommendation is needed.
44. The Council further delayed in adding Mrs X’s husband to her social housing application. It did not do this until February 2020. This was also fault. However, it would not have affected Mrs X’s priority for social housing as the Council had decided she was not statutory overcrowded. The Council correctly applied both the room and space standards to Mrs X’s case so was not at fault in deciding Mrs X was not statutory overcrowded.
45. In any event, Mrs X was prevented from bidding on social housing properties due to her high rent arrears. The Council's policy states applicants will not be able to bid on social housing if they have rent arrears. The Ombudsman cannot question a Council's decision if it is made without fault. The Council acted in line with its policy when it decided not to allow Mrs X to bid. It was not at fault.

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Agreed action

46. Within three months of the date of my final decision, the Council will:
• remind staff they should consider the affordability of someone’s temporary accommodation, and whether they are eligible for a discretionary housing payment at an early stage, before they accrue considerable rent arrears; and
• remind staff they must act promptly when they receive a change of circumstances notification for a housing application.

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Final decision

47. I have completed my investigations. I have not found fault with how the Council dealt with Mrs X’s housing benefit. I have found fault leading to personal injustice in how it responded to her housing concerns. I have recommended action to prevent reoccurrence of the fault.

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Investigator's decision on behalf of the Ombudsman