Summary: Miss X complained about the Council’s handling of her housing case when she told it she was at risk of becoming homeless due to rent increases. She said the Council failed to provide a decision letter and withdrew support despite her being in an unaffordable property. We find the Council at fault for failing to make a timely decision regarding the duties it owed Miss X which caused her injustice. The Council agreed to apologise, take corrective action and make a symbolic payment to acknowledge the injustice.

The complaint

1. Miss X complains about the Council’s handling of her housing case. She said Encompass LATC Ltd (Encompass), which provided services on behalf of the Council, failed to properly consider and respond to her concerns she and her child were at risk of homelessness.
2. Miss X says this caused her distress, frustration and uncertainty.

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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 significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
4. We investigate complaints about councils and certain other bodies. Where an individual, organisation or private company is providing services on behalf of a council, we can investigate complaints about the actions of these providers. (Local Government Act 1974, sections 24A(1)(A) and 25(7), as amended).
5. 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 provider has done. (Local Government Act 1974, sections 26B and 34D, as amended)
6. 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 34H(i), as amended)

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What I have and have not investigated

7. I have investigated the period from May 2023 when Miss X first told Encompass her landlord was attempting the increase her rent, until September 2024 when Miss X complained to us.
8. It took Miss X more than 12 months to complain to us about things that happened in May 2023 and the complaint is late. However, Miss X did not at any time allow the matter to rest for more than two months and there was continuing fault and injustice. I have decided these are good reasons to investigate the complaint.

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How I considered this complaint

9. I considered evidence provided by Miss X and Council as well as relevant law, policy and guidance.
10. Miss X and the Council had an opportunity to comment on my draft decision. I considered any comments before reaching a final decision.

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What I found

Law and Guidance

General duties and homeless definitions

11. Part 7 of the Housing Act 1996 and the Homelessness Code of Guidance for Local Authorities sets out councils’ powers and duties to people who are homeless or threatened with homelessness.
12. Someone is homeless if they have no accommodation or if they have accommodation, but it is not reasonable for them to continue to live there. (Housing Act 1996, Section 175)
13. Someone is threatened with homelessness if, when asking for assistance from the council on or after 3 April 2018:

• they are likely to become homeless within 56 days; or
• they have been served with a valid Section 21 notice which will expire within 56 days. (Housing Act 1996, section 175(4) & (5)

Councils’ duties to make inquiries, notify people of decisions, and complete assessments and personalised housing plans

14. If someone contacts a council seeking accommodation or help to obtain accommodation and gives ‘reason to believe’ they ‘may be’ homeless or threatened with homelessness within 56 days, the council has a duty to make inquiries into what, if any, further duty it owes them.
15. The duties a Council may owe are the prevention duty, the relief duty and the main housing duty.
16. The threshold for triggering the duty to make inquiries is low. The person does not have to complete a specific form or approach a particular department of the council. (Housing Act 1996, section 184 and Homelessness Code of Guidance paragraphs 6.2 and 18.5)
17. After completing inquiries, the council must give the applicant a decision in writing. If it is an adverse decision, the letter must fully explain the reasons. All letters must include information about the right to request a review and the timescale for doing so. (Housing Act 1996, section 184, Homelessness Code of Guidance 18.30)
18. Councils must complete an assessment if they are satisfied an applicant is homeless or threatened with homelessness. The Code of Guidance says, rather than advise the applicant to return when homelessness is more imminent, the housing authority may wish to accept a prevention duty and begin to take reasonable steps to prevent homelessness. Councils must notify the applicant of the assessment.
19. Councils should work with applicants to identify practical and reasonable steps for the council and the applicant to take to help the applicant keep or secure suitable accommodation. These steps should be tailored to the household, and follow from the findings of the assessment, and must be provided to the applicant in writing as their personalised housing plan. (Housing Act 1996, section 189A and Homelessness Code of Guidance paragraphs 11.6 and 11.18)
20. If councils are satisfied applicants are threatened with homelessness and eligible for assistance, they must help the applicants to secure that accommodation does not stop being available for their occupation. In deciding what steps they are to take, councils must have regard to their assessments of the applicants’ cases. (Housing Act 1996, section 195)

Private tenants

21. The Code of Guidance says it is unlikely to be reasonable to continue to occupy a private rented tenancy beyond the expiry of a notice to quit. (Code of Guidance 6.35) It is highly unlikely to be reasonable to continue to occupy beyond the expiry of a court order granting possession. (6.36)
22. The Code of Guidance says councils should have regard to various factors in deciding at what point it becomes unreasonable to remain and therefore the applicant becomes homeless and owed the relief duty. This includes the wishes of the tenant, the impact on the landlord, the financial impact of court action and/or rent arrears on both the landlord and the tenant, and the burden on the courts of unnecessary proceedings. (6.33)

Review rights

23. Homeless applicants may request a review within 21 days of being notified of decisions including:

• their eligibility for assistance;
• what duty (if any) is owed to them if they are found to be homeless or threatened with homelessness.

What happened

24. Below is a brief chronology of key events. It is not meant to show everything that happened.
25. Encompass was a local authority trading company (LATC) that delivered homelessness and adult social care services on behalf of the Council. The Council decided not to extend the contract held by Encompass beyond 31 December 2024 and bring the services it provided back in house. Encompass decided it would be wound up voluntarily and appointed liquidators. The services previously delivered by Encompass are now delivered by the Council.
26. At the beginning of May 2023 Miss X told Encompass her landlord was increasing her monthly rent. Miss X said she could not afford to pay the increase. Miss X explained she had a young child and was facing homelessness.
27. Encompass spoke to Miss X. Miss X confirmed the landlord had not served a section 13 notice that would be required to increase the rent. She had not agreed to the rent increase. Encompass sent her a factsheet about rent increases and took no further action.
28. In July Miss X contacted Encompass again. She said her landlord was increasing her rent and had also served an eviction notice. She could not afford the rent. She said she and her and her child were going to be homeless.
29. Encompass scheduled a telephone interview with Miss X later in July but failed to contact Miss X as agreed. It sent Miss X an email requesting documents. It said it needed to check the eviction notice issued by the landlord was valid.
30. In August Miss X contacted Encompass again. She said it had not offered her any help or support and she was being harassed by the landlord. Her rent increased at the end of August.
31. Encompass conducted a financial assessment of Miss X’s income and expenditure. It questioned whether some of Miss X’s expenditure was necessary. Miss X explained it was necessary because her child had special needs. She said the expenditure in question was lower than the increased rent and therefore made no difference to the affordability.
32. A person at Encompass recorded their opinion that Miss X should be put under the prevention duty. However the organisation did not make a formal decision or notify Miss X what, if any, duty it owed.
33. In September Encompass commenced negotiations with Miss X and the landlord. It said if Miss X could pay some of the increase, it would also pay some of the increase. This arrangement was called a landlord incentive.
34. In October Miss X agreed the landlord incentive agreement, but raised repeated concerns she could not afford the increase. She started paying her landlord extra money on the understanding Encompass was paying the rest of the increased rent.
35. Miss X formally complained to Encompass about its handling of case. Encompass provided a final response in December. It accepted it had taken too long to reach a conclusion and complete its assessment. However it did not make a formal decision or notify Miss X what, if any, duty it owed.
36. In January 2024 Miss X told Encompass her landlord had sold the property. She said the new owners wanted to occupy the property which put her and her son at risk of homelessness. Miss X provided the Council with evidence she was being threatened with legal action for the rent arrears that she thought Encompass had agreed to pay.
37. Encompass realised it had not been paying the landlord the extra rent it had agreed to under the landlord incentive.
38. In February Miss X told Encompass her rent was increasing again. She said she could not afford any more rent. She said the situation was having a significant negative impact on her finances and health. It did another financial assessment. It referred Miss X to a charity that provides advice, and asked her to report back with the advice she received.
39. In March Encompass accepted Miss X onto the Council’s housing register. It sent her a letter that it had placed her in Band D. The housing allocation policy says Band D is for people threatened with homelessness, and that are owed the prevention or relief duty, but the letter did not clarify what duty it owed Miss X.
40. Later in March Miss X’s rent increased for a second time. She told Encompass she could not afford the rent.
41. Encompass told Miss X her case had been discussed with a manager. It told Miss X “the property is not suitable because it is unaffordable and is in bad disrepair. We will progress your case to Relief Duty.” However it did not make a formal decision or notify Miss X about the duty it owed.
42. In June Encompass conducted another financial assessment. It recorded the accommodation was unaffordable. However it did not make a formal decision or send her notification about the duty it owed.
43. Encompass told Miss X it thought some of her bills were too high and asked her to visit the charity that provides advice again.
44. Miss X raised another formal complaint with Encompass. She complained it had not sent her a decision letter. It replied at the end of June. It agreed with all the points she complained about and apologised. It did not provide a decision on what duty it owed Miss X, nor propose a timescale for doing so.
45. Miss X complained to the Ombudsman in September. Encompass had not made a decision or notified Miss X about the duty it owed.

Analysis

46. Miss X first told Encompass her landlord intended to increase her rent in May 2023. She said she could not afford the increase and was therefore threatened with homelessness. Encompass spoke to Miss X who confirmed the landlord had not served a section 13 notice to increase her rent, and she had not agreed with the increase. Therefore there were no immediate legal grounds for the landlord to increase her rent. For this reason I do not find Encompass at fault regarding its actions in May.
47. When Miss X contacted Encompass again in July 2023 she provided information that the landlord was still attempting to increase her rent to an amount she could not afford, and was attempting to evict her.
48. This was sufficient information for Encompass to believe Miss X may be threatened with homelessness. It therefore had a duty to make inquiries to establish if Miss X was eligible for assistance, decide what, if any, duties it owed, and to notify Miss X of its decision.
49. Encompass commenced inquiries in July 2023. However, it had not completed its inquiries, decided what duties it owed, and notified Miss X of its decision by September 2024, more than a year later, when Miss X complained to us.
50. During this period Encompass’s records demonstrate it had multiple opportunities to complete its inquires and make a decision. These included:

• Recording it thought it owed Miss X the prevention duty as early as August 2023.
• Conducting three financial assessments.
• Admitting fault in its response to Miss X’s complaint in December.
• Realising it had failed to pay Miss X’s landlord the incentive in January 2024.
• Learning Miss X’s rent was increasing a second time in March.
• Placing Miss X in Band D of its housing allocation priority also in March.
• Telling Miss X it would progress her case to relief duty also in March.
• Admitting fault for a second time in its response Miss X’s complaints in June.

51. I find Encompass’s failure to decide what homelessness duties it owed Miss X was fault.
52. The fault denied Miss X a written decision to consider, and potentially appeal. It also denied Miss X the possibility of an assessment and personalised housing plan including tailored help. This caused Miss X injustice in the form of significant distress, uncertainty and frustration. Miss X has a dependent child which is an aggravating factor to the injustice.
53. I also find Encompass’s complaint handling was flawed because it failed to remedy failings despite acknowledging them twice. This was fault which caused injustice to Miss X in the form of additional time and trouble.
54. I have considered remedies for the injustice to Miss X. When a council commissions another organisation to provide services on its behalf it remains responsible for those services and for the actions of the organisation providing them. So, although I found fault with the actions of Encompass, I have made recommendations to the Council.
55. The Council should apologise to Miss X for the injustice caused by its failure to make a decision regarding the duties it owes and for its flawed complaint handling.
56. Miss X said she has not yet received a decision letter. As such there is still unremedied injustice after an apology. The Council should take corrective action by completing its inquiries and notifying Miss X of the duties it currently owes her as soon as possible.
57. I cannot decide what, if any, duties the Council owes. However, if it decides it owes any duties it should provide Miss X a timeline for the planned completion of any following steps. These could include the completion of a full assessment and personalised housing plan.
58. I consider there is still significant unremedied injustice arising from the fault. The Council should make a payment to Miss X to symbolise the distress and difficulties she has been put through
59. Finally, I have considered whether I can recommend service improvements to prevent future injustice to others. I note the Council no longer commissions Encompass to deliver its housing services. Encompass is also in liquidation. Any potential service improvements would have been directed to Encompass. Therefore I do not make any in this case.

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Action

60. Within four weeks of the date of this final decision the Council will:

• Apologise to Miss X for the injustice caused. We publish guidance on remedies which sets out our expectations for how organisations should apologise effectively to remedy injustice. The organisation should consider this guidance in making the apology I have recommended in my findings.
• Take corrective action by deciding what homelessness duties, if any, it owes. Formally notify Miss X of its decision in writing and provide a timeline for the planned completion of any relevant following steps.
• Make a payment of £300 to acknowledge the distress caused.

61. The Council should provide us with evidence it has complied with the above actions.

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Decision

62. I have completed my investigation and uphold Miss X’s complaint. I find fault causing injustice. The Council has agreed actions to remedy injustice.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman