Summary: Mr B complains that the Council has refused to pay a community grant of £10,000 which it had agreed to provide to the local parish church. The Ombudsman considers that the Council was not at fault in refusing to pay the grant on the basis that the terms had not been complied with.

The complaint

1. Mr B complains, on behalf of the vicar of the local parish church, that:
• The Council has refused to pay a community grant of £10,000 which it had agreed to provide to the local parish church to undertake works to improve its facilities for the benefit of the community.
• Although it had awarded the grant and the church had accepted the grant, the Council said that the grant offer had expired, despite not having informed the church that there was a deadline to apply for the funds.
• This has left the church with a substantial shortfall in the funding needed to pay for the works.

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The Ombudsman’s role and powers

2. 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)
3. 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)

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How I considered this complaint

4. I have considered Mr B’s written complaint and supporting papers and discussed his complaint with him. I have made enquiries of the Council and considered its response to my enquiries. I have also sent Mr B and the Council a draft decision and considered their comments.

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What I found

What happened

5. In the 2013/14 financial year, the Council had a budget surplus of £900,000 which it wished to return to local residents in a cost-efficient manner. The Council decided to do so by means of a one-off allocation of funding for community activity in the 2014/15 financial year. This was called the Cheshire East Giveback (Your Money Fund).
6. Mr B’s local parish church was planning improvement works and applied to the Council for funding under the scheme. The church is a listed building and the works involved excavation within the churchyard.
7. The Council wrote to Mr B on 5 January 2015 advising that the church’s grant application had been successful and an award of £10,000 made. The Council’s offer letter dated 5 January 2015 also stated:

“This grant offer is made in accordance with and subject to the terms and conditions that are set out in the application guidance notes, a copy of which is attached to this letter and forms part of the grant offer”.

“If you wish to accept the grant offer please sign and date two copies of this letter, keep a copy for your records and return a copy to the address above. Electronic signatures will be accepted if you wish to return a copy via email. Grant offers are only valid for a period of 12 months from the date of this letter.”

8. The Council has explained that, as well as sending a copy of the Terms and Conditions with the offer, it sent Mr B a copy of another document entitled the Grant Criteria and Principles, though Mr B does not believe that he received this.
9. On 21 August 2015, the Council sent Mr B a reminder letter asking him to submit the acceptance form, as it had had no further contact from him. The letter stated:

“I am writing with reference to the Cheshire East Giveback grant that was awarded to your organisation in April 2015.”

“To date, I am yet to receive your grant offer acceptance form. Could you please let me know, as soon as possible if your organisation intends on claiming the grant that was awarded and provide an update on the current position of your project.”

10. The Council reviewed the applications on 12 November 2015 and noted that no response had been received from the church. At that point, the Council sent reminders to organisations with monitoring information outstanding. The Council did not send the church a reminder as it had not received an acceptance form.
11. After a further review of the scheme, the Council sent Mr B an email on 3 August 2016. It advised that it had not received an acceptance form from the church and that the grant offer had expired in January 2016.
12. The next day, Mr B responded by email stating:

“I confirm that I submitted an acceptance form last year. For whatever reason you appear not to have received it. I attach another acceptance form which I hope satisfies your requirements. The work has commenced, and I hope to submit further documentation shortly.”

13. The officer responded the same day stating:

“Thank you for sending a new acceptance form and I look forward to receiving the rest of your documents in order to pay the grant for your project.”

14. The Council set aside the grant money, and this was accrued within the budget until the end of the 2017/18 financial year. After this, grants that had not been claimed (and where there had been no further communication) were no longer accrued.
15. In the meantime, the church encountered difficulties with the contractor and the project was substantially delayed. It was not until towards the end of 2018 that the first bill and architect's certificate were issued and duly paid.
16. Mr B expected that the Council would require the project to be well-advanced before it would pay the grant. He therefore did not write to the Council until 5 April 2019, when he sent an email stating that the project was nearing completion and that he wished to submit the documents so that the grant could be paid.
17. The Council responded to Mr B on 9 April 2019, explaining that the grant was no longer available.
18. Mr B complained to the Council, but it did not uphold his complaint and explained that the payment would not be made.

My assessment

Acceptance of the offer

19. Mr B considers that the Council accepted his application when it acknowledged his application form in August 2016.
20. The Council says that the form it has on file is a typed signature stating that it is a copy of the earlier acceptance form. It does not consider this sufficient evidence of acceptance of the grant.
21. I do not agree with the Council’s position here. Mr B had resent the form. The Council had received and acknowledged the form and the officer gave no indication that the acceptance form was invalid. I therefore consider that Mr B was entitled to reach the view that he had provided sufficient information at that point to accept the grant and that the Council agreed with this.

Monitoring

22. Mr B considers that there was no good reason for the Council to refuse to pay the grant. He says he was not told at any stage that, once a grant was offered and accepted, it had to be claimed by a given date or it would be lost.
23. He acknowledges that he told the Council that he hoped to submit further documentation shortly and that this expectation was, with the benefit of hindsight, misplaced. However, the Council’s offer letter requires invoices prior to grants being paid, and the was a delay in the works and the associated invoices.
24. He says that the guidance notes state that the Council will require a monitoring report following a project’s completion. At the time that he requested payment of the grant in April 2019, the project was not yet complete.
25. He notes that the offer letter states, “It is a condition of the grant that you provide a report and photographs, if possible, within twelve months of the grant being awarded”. In his view, the 12-month period is secondary to and follows the project’s completion.
26. The guidance notes state, “Organisations must notify the Council of any changes in circumstances which affect their financial position throughout the period in which the grant monies are being used”. However, Mr B saw no reason to notify the Council, as the project delay had no impact on the church’s financial position,
27. He also considers that it would have been appropriate for the Council to ask the church why it had not claimed the grant before returning monies to balances at the end of the 2017/18 financial year.
28. As set out above, I consider that Mr B could reasonably assume that the Council understood that he had accepted the grant offer, and that the grant offer was valid as of August 2016.
29. There is a difference of views as to whether the Grant Criteria and Principles document was sent to Mr B, so I have not placed any weight on this document in respect of what Mr B was told.
30. I note Mr B’s view that the “… condition of grant that you provide a report and photos provided, if possible, within 12 months of the grant being awarded” is secondary to the requirement to submit a report following project completion.
31. In my view, the wording suggests that a report would normally be required within 12 months of the initial award and the phrase “if possible” relates to the provision of photographs to support the monitoring report, rather than the requirement to report within 12 months.
32. In any event, even if the phrase is read such that the requirement if to report within 12 months if possible, I consider that the Council could reasonably have expected to be informed if the church was not in a position to report within that 12 month period, as other applicants appear to have done.
33. As to Mr B’s suggestion that the Council should have contacted the church again before returning monies to balances, the Council had already written to the church in August 2015 and August 2016 and expected to receive the paperwork shortly. It seems to me that the next step was for the church to contact the Council. I do not consider that the Council was at fault in not contacting the church again when it did not receive any documentation or further contact from the church.
34. In the absence of further contact, I do not consider that the Council could be expected to hold back the use of £10,000 of public funds indefinitely and I consider it was entitled to conclude that the funding was no longer required.
35. I appreciate that this is a difficult situation for the church, and I understand that Mr B was acting in good faith according to his understanding of the situation. However, on balance, I consider that the Council was entitled to expect the submission of a monitoring report within 12 months or, at least, an explanation as to why it was not possible to submit such a report.

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Final decision

36. I have closed my investigation into Mr B’s complaint because I do not consider that the Council was at fault in refusing to pay the grant due to non-compliance with the grant conditions.

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Investigator's decision on behalf of the Ombudsman