Council writes off £21k debt after Ombudsman investigation into failure to assess mental capacity and finances properly

An investigation by the Local Government and Social Care Ombudsman has found that North Yorkshire County Council “repeatedly” missed opportunities to assess a woman’s mental capacity regarding her ability to manage her finances when this was in doubt.

The Ombudsman found fault with the council’s decision to charge the woman, Mrs Z, for the full cost of her care fees for several years before she died, based on “incomplete information” regarding her finances.

In response, the council has agreed to write off the £21,987.06 debt it says she owed.

The individual behind the complaint, Mr X, complained that the council was wrongly charging his deceased relative (Mrs Z)’s estate more than £21,000. He argued that the council incorrectly calculated what she was able to pay towards her care costs.

The Ombudsman said that several years ago, Mrs Z developed health problems affecting her mobility and independence.

On 20 April 2020, the council began carrying out a financial assessment with Mrs Z over the phone to see how much she should be paying towards some non-residential care services she was receiving.

The officer ended the call early and was unable to finish the assessment. They recorded that they did not think Mrs Z had mental capacity around her finances as she “did not appear to understand who she was paying and for what”, the report noted.

Following a review of her care needs, in July 2020 the council carried out a ‘light touch’ financial assessment. It charged Mrs Z the full cost of her care.

Mrs Z moved to an interim placement in a residential care home - Care Home A - on 25 August 2020.

In early October, Mrs Z had conversations with the council where she “disputed that she needed any help with finances”, but in other notes, professionals recorded that she was “worried about money and would benefit from a financial assessment”, said the Ombudsman.

On 21 October 2020, the council said Mrs Z required a mental capacity assessment to be carried out regarding her finances. However, this was not carried out.

Mrs Z was financially assessed again on 26 October 2020, on the same day she moved to a new care home – Care Home B, which cost £1,167.25 per week.

She was assessed as being able to contribute £1,150.00 per week to the care home fees. Mrs Z lived at Care Home B until she died on 21 April 2022.

The Ombudsman revealed that before she died, Mrs Z was allocated an Independent Mental Capacity Advocate (IMCA).

On 18 February 2022, the IMCA requested a DOLS [Deprivation of Liberty Safeguards] review. “However, the review never took place and a mental capacity assessment was never carried out for Mrs Z before she died in April 2022”, said the Ombudsman.

In July 2022, Mr X contacted the council to establish what Mrs Z owed in any outstanding care costs from her estate. The council said it did not yet have the total amount Mrs Z owed as it had not been able to obtain bank statements needed to calculate this.

The report noted that for several months, Mr X chased the council and it still could not provide the total figure owed.

On 24 November 2022, North Yorkshire asked Mr X to pay £11,017.94, which he disputed.

The council considered the amount again. On 22 December 2022, the council said it had made an error and the outstanding balance was £21,987.06 to be paid from Mrs Z’s remaining estate.

Mr X made a complaint to the council. He said Mrs Z received £334.28 every four weeks in benefits and had no other income. He said her remaining estate after funeral costs came to only £23,250 and “he therefore did not understand how her closing care bill could be £21,987.06 because her remaining savings were so close to the capital limit”, said the Ombudsman.

The council responded at the final stage of the complaints process on 7 February 2023. It explained the upper capital limit rules but did not provide an explanation of how this applied to his relative’s estate.

Outlining the investigation’s findings, the Ombudsman said that councils must carry out mental capacity assessments “where a person’s capacity is in doubt”.

However, it was found that the council failed to do this on “multiple occasions” regarding whether Mrs Z could manage her own finances.

The Ombudsman said: “The records show that during this time, the council used light touch financial assessments, without possession of key documents, and continued to charge Mrs Z the full cost of her care fees.”

The report concluded: “On the balance of probabilities, the council’s records regarding Mrs Z’s finances are unreliable and it is not in a position to request the sum of £21,987.06 from Mrs Z’s estate”.

The Ombudsman also found fault with the council’s communication with Mr X. The report stated: “He chased the council repeatedly for four months before the council could provide him with a figure of the total owed. One month later it then doubled this figure due to an error. This significant delay and poor communication by the council was fault.”

To remedy the injustice caused, the council was recommended to apologise to Mr X, write off the £21,987.06 debt which it said was owed from Mrs Z’s estate, and pay Mr X £350 in recognition of the “frustration and time and trouble Mr X was put to by the council’s poor communication and complaint handling”.

The Ombudsman revealed the council has agreed to these measures. It will also carry out “several service improvements to prevent this fault occurring in future”.

North Yorkshire Council’s director of health and adult services, Richard Webb, said: “We accept in full the ombudsman’s recommendations in this case and apologise for the distress and anxiety that was caused to Mrs Z and her family.

“We have already undertaken some of the work involved and a full review will be carried out to ensure mental health capacity assessments are undertaken in a timely manner to ensure opportunities are not missed.”  

Lottie Winson