The Ombudsman's final decision
Summary: Mr X complains the Council is refusing to pay his Housing Benefit by any other means except banks transfer. I have concluded my investigation having not made a finding of fault. The Council has discretion with how to make Housing Benefit payment, and there is nothing in the legislation or guidance that obligates the Council to make payment by cash, cheque or any alternative method. It is not for our service to decide how the Council should make such payment and in the absence of Mr X having a bank account, it has offered him a number of alternatives with how it can make the payment.
The complaint
Mr X complains the Council is refusing to pay his Housing Benefit by any other means except bank transfer. The Council’s refusal has caused him to be homeless.
The Ombudsman’s role and powers
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)
How I considered this complaint
I liaised with Mr X and considered the information he provided. I also made enquiries with the Council and considered the information it provided in response. I offered Mr X and the Council an opportunity to comment on my draft decision and considered any comments submitted before the deadline.
What I found
Relevant law and guidance Housing Benefit Housing Benefit helps eligible people on low incomes pay their rent and the Council manages and pays this. The Housing Benefit Regulations 2006 (the Regulations) set out the rules councils must follow for calculating and paying Housing Benefit. Usually the Council pays the tenant Housing Benefit; it is responsible for paying the rent to the person’s landlord.
The Housing Benefit Regulations 2006 The Housing Benefit Regulations 2006 states ‘the relevant authority shall pay housing benefit to which a person is entitled under these Regulations at such time and in such manner as is appropriate, having regard to: the times at which and the frequency with which a person’s liability to make payment of rent arises; and the reasonable needs and convenience of the person entitled thereto.
HB/CTB Guidance Manual The HB/CTB Guidance Manual states that Council’s have ‘the discretion to decide how to pay HB’ and that it must ‘take into account the reasonable needs and convenience of the claimant’.
What happened In June 2023, Mr X submitted a Housing Benefit application for Property A.
In July 2023, Mr X informed the Council that he did not have a bank account. The Council informed Mr X it could consider payment into a third-party bank account.
In mid-July 2023, the Council advised Mr X that it would, on this occasion only, create a manual cheque to make payment.
Later in July 2023, the Council says it became aware that it no longer possessed an emergency cheque-book and so as a work around, it would liaise with an alternative department to produce a voucher that could be taken to the Post Office to exchange for cash.
In September 2023, Mr X submitted a Housing Benefit application for Property B. The Council responded to inform Mr X that it had only been able to create a manual payment as a one off, and would require bank details to release the payment for his recent claim.
In October 2023, Mr X raised a formal complaint with the Council regarding the Council to make paying for the Housing Benefit application made in September 2023. In mid-October, the Council responded to inform Mr X that it would be unable to make the payment without a bank account to pay in to.
Later in October 2023, Mr X escalated his complaint to stage 2 of the Council’s complaints procedure. In November 2023, the Council responded to inform Mr X that the Council did not have the facilities to pay by cash or cheque, and that it had offered to make the payment by BACS, into a bank account of a nominated third party, or to pay the landlord directly.
In November 2023, the Council informed Mr X that it would support him with finding a property to help secure permanent accommodation with Landlord A. The Council said it explained to Mr X that as it could pay the landlord directly, the absence of a bank account would not be an issue.
Toward the end of December 2023, Landlord A informed the Council it had made an offer to Mr X for a self-contained one bedroom flat, but that Mr X had declined the offer.
In February 2024, Mr X submitted Housing Benefit applications for historic stays at Property C and Property D. The Council responded to inform Mr X that it cannot release the payments for the two latest claims until it received bank details.
Analysis Making the Housing Benefit payment As described between paragraph 4-6, the Council has discretion with how to make payment for Housing Benefit and it should take into account the reasonable needs and convenience of the claimant. Where the Council has discretion with how it makes payment for Housing Benefit, it is not for our service to decide how the Council should make payment, but rather whether it has considered the reasonable needs and convenience of Mr X.
The Council says cheque payments have not been a payment method offered by the local authority since 2017 due to the disproportionately high cost of administering this to a small number of claimants. The Council also says that despite having made payment via a voucher that Mr X was able to redeem at the Post Office, this was offered as a one-off alternative at the time which Mr X was advised of.
The Council is aware that Mr X does not have a bank account, and it has signposted Mr X to support in order to open a basic account to assist with the process.
I consider that the Council has considered the reasonable needs and convenience of Mr X. In knowing Mr X does not have a bank account, the Council has provided alternative solutions to make the Housing Benefit payment award; it offered to make the payment into a nominated third-party bank account or to pay the landlord directly, but says that Mr X has declined these options. Mr X disputes that he declined such offers.
There is nothing in the guidance or legislation that obligates the Council to make Housing Benefit payment by cash, cheque or any alternative payment method. Where the Council has discretion, it is for the Council to decide how to make such payment. I therefore have not made a finding of fault and have found that the Council have offered alternative methods of payment to Mr X, and have not demanded it bank transfer the payment to him.
Has Mr X been made homeless due to the actions of the Council?
Mr X says the Council’s failure to make Housing Benefit payments means he is homeless as a result.
However, I note the Council has offered to make payment to a landlord directly in order for Mr X to secure accommodation. Further, the Council facilitated communication with Landlord A who offered Mr X a self-contained one-bedroom flat that he declined. I therefore do not consider the Council’s actions have either directly or indirectly caused Mr X to be homeless.
Final decision
I have concluded my investigation having not made a finding of fault. The Council has discretion with how to make Housing Benefit payment, and there is nothing in the legislation or guidance that obligates the Council to make payment by cash, cheque or any other alternative method. It is not for our service to decide how the Council should make such payment and in the absence of Mr X having a bank account, it has offered him a number of alternatives with how it can make the payment.
Investigator's decision on behalf of the Ombudsman