Date of decision:27th July 2025
Summary
Mr X asserted that Bedford Borough Council mishandled his financial assessments and failed to consider his disability-related expenses fairly, resulting in unaffordable care charges and mounting debt.
What happened
From at least 2019, the Council assessed Mr X’s contributions for care without receiving completed financial forms or any disability-related expense (DRE) details from him. The Council increased Mr X’s required payments annually, from £70.94 a week in 2019 to £159.77 by April 2024, using benefit information it already held.
Where a person does not have supporting evidence the Council allowed up to £30 per week to be claimed, as a good compromise between administrative efficiency, and not imposing on disabled people. If the person can provide supporting evidence the Council would allow the actual amounts in line with its policy.
Mr X never paid these charges, and accrued substantial debt over several years. Mr X argued repeatedly that the Council’s process failed to acknowledge his legitimate DRE claims, and that its policy was unlawful and discriminatory against those with mental health needs.
In April 2024 the Council informed Mr X of a further increase following an uplift in his benefits but failed to notify him beforehand. Mr X asked for a face-to-face meeting, which was arranged for June 2024. After the meeting, Mr X contested the Council’s summary, highlighting gaps including the Council’s lack of process for considering mental health needs before issuing payment demands, the absence of support around his growing debt, and inadequate staff understanding of DRE.
Despite further correspondence, there was a significant delay in resolving Mr X’s complaint. Only after Mr X contacted the Ombudsman in November 2024 did the Council respond. In this response the Council partially upheld notice and communication failures, but rejected other concerns.
The Council said its processes followed statutory guidance and national practice (NAFAO), and on energy costs or DRE, the Council stated that individuals must provide supporting information for consideration. The Council also revealed it operated a ‘Panel’ system to scrutinise any DRE claim over £45 per week. Although the financial assessment form did not list anything specific to claim for mental health related items or services, the Council noted Mr X could claim for these under “other” items or services.
Mr X continued to argue that the Council had not trained provider staff, had not explained nor supported his claims, and had used threatening debt letters rather than assistance, which affected his health. The Council revealed in May 2025 that Mr X’s care debt totalled over £40,000 and provided no evidence of proactive debt discussion or support. The Council acknowledged it had no formal DRE training for staff.
What was found
The Ombudsman found the Council failed to communicate effectively and did not provide support to manage Mr X’s escalating debt, which breached its own debt recovery policy and statutory expectations.
There was a delay in handling the complaint, adding to distress.
There was no fault in calculating contribution levels on the information available, but the Council failed to offer help or prevent the debt from increasing, contrary to proper administration. Mr X experienced significant distress and frustration as a direct result.
It was of concern that Mr X had accrued such a large debt, without the Council discussing this with him or offering any assistance. The initial stage of debt recovery should – under the Council’s own policy – have involved discussing the debt with the person. The policy said the desired outcome is to prevent the debt from escalating and for the person to enter into affordable repayments of the debt as well as pay ongoing costs. There was no evidence the Council followed this procedure in this instance.
The Ombudsman ordered that the Council must apologise, pay £300 for distress and review communication between finance and social work teams. The Council should produce guidance for staff about managing debt for vulnerable adults and review Mr X’s own charges if an updated financial assessment form is completed by him.
The Council was also told to review its financial assessments to establish a correct level of charging for current and previous years. Having determined his outstanding debt the Council was to agree a manageable payment plan.
Points to note for councils, professionals, people using services and their carers, advocacy groups and members of the public
The Ombudsman’s report highlights the need for fair charging and support but does not fully engage with the legal obligations under the Care Act and Statutory Guidance.
The report quotes Annex C of the Care and Support Statutory Guidance, which says that a person’s care plan “…may be a good starting point for considering what is necessary disability disability-related expense. However, flexibility is needed. What is disability-related expenditure should not be limited to what is necessary for care and support.”
The investigator stated explicitly that the Council’s own charging policy (by contrast to the Guidance) stated that it would only take account of DRE if it was identified as part of a person’s support plan. At another point, though, the investigator said that s/he did not take the Council’s charging policy to require the support plan specifically to list DRE before it could count, but interpreted it more broadly to allow it to stand. It is disappointing that this report does not explore the tension between these different statements or set out the Ombudsman’s view on the lawfulness of the Council’s policy, stating instead that “the Ombudsman has no jurisdiction to determine whether the Council’s charging policy complies with the law or statutory guidance.” The Windsor & Maidenhead judgment is the leading case on DRE and makes it crystal clear that the DRE does not have to be considered in advance in the care plan, or mentioned in advance, there, either, before it can count as DRE.
The Council said its assessment of DRE was based on the good practice guidelines developed by the National Association of Financial Assessment Officers. This policy wording, would be a clear breach of the Statutory Guidance or at least misleading to the public. It would mean that every time a person wanted to assert new DRE, they would need a review of their Care Plan.
Mr X had not completed a financial assessment form during the period of the investigation. He complained that the Council had not assessed the affordability of his contribution or whether he could pay it. The report notes that to do this he would need to provide details of any DRE he would like to be considered. Obviously one cannot be awarded DRE other than through a discretionary standard amount if one does nothing to assert the need for the expenditure.
The report says that Mr X had a package of care from a company which provided mental health and associated services, but does not say whether or to what extent Mr X’s mental health impacted on his ability to provide this information. It seems likely that he would have benefited from more support with this. We are aware that providers don’t understand the charging system as a matter of course, but whether this one was supposedly contracted to support the individual in this regard is unknown.
We are aware that historically finance officers from some Councils would visit service users at home to help them complete financial assessment forms and provide information, but this practice may be declining as a response to cost pressures. Mr X could have benefited from this personal approach.
The Council seems to have failed in the advice and information duties set out in the Statutory Guidance which states: ‘The local authority must provide information to help people understand what they may have to pay, when and why and how it relates to people’s individual circumstances.’
The guidance also enables local authorities to include the provision of support on money management, as part of a person’s care plan; the facility of appointeeship, for instance, or contracting with a provider to help a capacitated person who just finds it difficult, with their finances. Independence is enhanced by supporting people to make informed, affordable and sustained financial decisions about their care. We are not told what the man’s money had been spent on, but he clearly did not have any left, otherwise he would have not had benefits still in payment.
Mr X was a service user with a mental health condition, but the report does not suggest that he lacked capacity to manage his finances. If he did lack capacity then the Statutory Guidance requires the Council to find out if he had an EPA, LPA, deputy or any other person dealing with their affairs, such as an appointee. Otherwise an application to the Court of Protections for the appointment of a property and affairs deputy might be required, or securing him a professional appointee such as Money Carer Foundation. In that scenario, the cost of that service would have been DRE!
Annex D of the Care Act Statutory Guidance, makes it clear that councils must exercise discretion in debt management. Blanket recovery tactics, such as issuing threatening letters without first offering dialogue or support, are generally unlawful. Furthermore, a failure to consult the individual or their advocate is neither rational nor fair given the specific circumstances. Current guidance and case law also underline that review of charges is not a favour but a legal requirement, especially where failure to identify needs, costs, or expenditure has led to mounting debt.
While the Ombudsman stops short of statutory discrimination findings, a council’s refusal to adjust its procedures, forms, or communications to meet the person’s needs may be challenged under public law. For genuinely vulnerable adults, especially those with fluctuating or impaired capacity, courts expect authorities to evidence that they considered the impact of both the charging and debt management process on the person’s wellbeing and rights.
How this man would ever pay off that level of debt is simply not explored in the report.
We note that the Council contended that the Norfolk judgment ‘had not set a precedent’ and that only the courts could determine if the Council’s policy was compatible with the law. That is rubbish. Judicial review decisions DO set precedents in relation to the principles that they generate, regarding legality and fairness and as to the interpretation of human rights in play.
Broader implications include a need for all councils to ensure all financial assessment procedures are both flexible and sensitive to mental health, and that front-line staff are trained not just in policy but in the legal rights and safeguarded interests of people with disabilities or vulnerabilities. NAFAO does not have the power to issue guidance that is of the same status as the Care and Support Guidance, the charging regulations or case law about DRE, and it needs to stay up to date with the law.
Please use the following link if you want to read the original Local Government and Social Care Ombudsman’s Bedford Borough Council (24 013 793) report. If you are affected by the issues in this report, please consider asking a free, one-off question, anonymously, at a level of principle, here. Our experts’ response will give you an opinion which may then help you and the broader community, when posted.
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