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Clarion Housing Association Limited (202303877)

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REPORT

COMPLAINT 202303877

Clarion Housing Association Limited

16 May 2025

 

Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example whether the landlord has failed to keep to the law, followed proper procedure, followed good practice or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

  1. The complaint is about the landlord’s handling of the resident’s concerns about his rent account.

Background

  1. The resident was an assured shorthold tenant of the landlord. The tenancy commenced in October 2012. The landlord is a housing association. The resident is disabled and his flat was adapted for his needs. The resident has since moved out of the property.
  2. The resident contacted the landlord on 21 July 2022 and stated that since 2014, £9.50 was deducted weekly from his Employment and Support Allowance (ESA), to pay for a shortfall in rent and rent arrears. However, he stated he had recently applied for help through the Discretionary Housing Payment, but was told he was not eligible as there was no shortfall between his housing benefit and the actual rent. He stated that since 2017, his housing benefit had therefore covered the rent in full but the landlord had continued to deduct the shortfall. The resident said the error had cost him £260 per year for 5 years. He asked the landlord to stop the shortfall deduction and issue a refund.
  3. The resident raised a complaint in December 2022 about the landlord’s handling of his rent account concerns. He again stated there had been no rent shortfall since 2017 as his housing benefit covered the whole of the rent, but that £6 per week was still being deducted.
  4. The landlord issued its stage 1 complaint response on 7 February 2023. The landlord stated that:
    1. from 2014, the resident had rent arrears and, at the time, it charged and collected water rates on behalf of the water provider.
    2. it applied to the Department of Work and Pensions (DWP) for direct deductions from the resident’s benefits to collect the water rates and rent arrears. The residents housing benefit was therefore paid directly to the landlord.
    3. on 2 April 2017, the landlord stopped collecting water rates and customers began making payments directly to the water provider.
    4. it did not stop taking direct deductions for water rates as a direct deduction through the DWP.
    5. from 3 April 2017, the only deduction it should have collected from the resident’s benefits was the amount for rent arrears, which at the time was £3.70.
    6. it had processed a rent refund of £1,719.72, calculated as 306 weeks of £5.62 deduction for water rates.
    7. it had requested that DWP cancel the deductions on 3 February 2023.
    8. the refund for the incorrect deductions would put the resident’s rent arrears back to the level they would have been at, had it not incorrectly collected the water rates deductions.
    9. it also offered the resident £1,550 compensation, which would be offset against any arrears on his account. The amount was made up as follows:
      1. £1,500 for inconvenience caused, failure to follow process and taking into account the resident’s vulnerability.
      2. £50 for the delay in providing the stage 1 response.
  5. The resident contacted the landlord on 7 February 2023 and said he was unhappy that the compensation would offset arrears on his rent account. The resident also stated that he should have been paid interest on the amount reimbursed for the incorrect deductions. It is unclear what date the landlord escalated the complaint.
  6. The landlord issued its stage 2 complaint response on 19 May 2023, in which it stated that:
    1. the stage 2 complaint was not dealt with in accordance with its current service standard, which was to respond in 40 working days.
    2. it was unable to pay interest on the deduction repayment, but it had reviewed the compensation amount.
    3. it would pay additional compensation to acknowledge its service failure in continuing to accept deductions, despite water rates being removed from rent charges since 2017.
    4. it offered:
      1. £1,200 compensation, calculated as £200 per year for 6 years, which would be paid directly to the resident.
      2. £1,233.43, inclusive of £50 for the delay in issuing the stage 2 response, to be paid directly to the resident’s rent account, which would clear his arrears completely.
  7. The resident referred his complaint to the Ombudsman on 28 September 2023. He stated that he questioned whether the offer made by the landlord was fair taking into account the 6 years of service failure and the 10 months it took before the landlord looked at his concerns and agreed with him. The resident said that he wanted the Ombudsman to consider whether the amount he was eventually offered was fair and adequate.

Assessment and findings

  1. The landlord’s compensation policy states that it will award compensation of £700 and above in recognition of a failure that has had a severe long-term impact on the complainant. The policy states that it will consider whether the problem occurred as a result of a direct failure by the landlord, the length of time it took to resolve the problem and additional costs that were incurred directly by the resident because of a failure of service. The policy states that compensation payments will be used to offset rent or other arrears. Where a resident’s rent account is up to date or in credit, the payments shall be paid in to the customers’ accounts.
  2. The resident raised his concerns about the deductions on multiple occasions. He emailed the landlord in July, August, September, October and November 2022 about the issue. However, there is no evidence that the landlord looked into his concerns until he raised a formal complaint in December 2022. Landlords should endeavour to provide good customer service by communicating with residents about issues raised. However, the landlord did not respond to the resident’s queries within a reasonable timeframe, which was a failing.
  3. Within its complaint responses, the landlord identified that it had incorrectly taken deductions from the resident’s ESA for water rates. This was a further significant failing that resulted in the resident experiencing financial loss over a period of 6 years.
  4. Where there are failings by a landlord, the Ombudsman’s role is to consider whether the landlord has offered suitable remedies in line with the Ombudsman’s Dispute Resolution Principles: be fair, put things right, and learn from outcomes.
  5. At stage 1, the landlord calculated the total financial loss and refunded this to the resident, which was appropriate. The landlord also offered compensation for inconvenience caused. The total amount was offset against the resident’s rent arrears.
  6. The Ombudsman acknowledges the residents concerns that the landlord did not offer reasonable redress at stage 1 of the complaint. The 2 stage complaints process allows landlords to reconsider their position to ensure that the correct outcome is reached. In this case, the landlord did reconsider the amount of compensation offered.
  7. At stage 2, it explained that it did not add interest to payments in such circumstances. Although the landlord’s compensation policy did not make provision for interest payments, the resident’s request was reasonable in the circumstances. It was therefore appropriate that the landlord made a substantial compensation offer in addition to the refund. The amount offered cleared the arrears on the resident’s rent account and also included a sum paid directly to the resident.
  8. Overall, the landlord refunded the resident for the deductions and, in addition, it offered a total of £3,933.43 to reflect the inconvenience caused. We recognise that £2,733.43 of this amount was paid directly to his rent account. However, this was in line with its compensation policy and was therefore reasonable.
  9. In assessing an appropriate level of compensation, the Ombudsman takes into account a range of factors including any distress and inconvenience caused by the issues, the amount of time and effort expended on pursuing the matter with the landlord, and the level of detriment caused by the landlord’s acts and/or omissions. It considers whether any redress is proportionate to the severity of the failing by the landlord and the impact on the resident. Ultimately the Ombudsman considers what is fair and proportionate.
  10. The resident experienced financial detriment over a significant period of time due to the failing by the landlord. The resident also incurred time and trouble pursuing the landlord in order to reach a resolution. The resident informed the landlord that he is disabled and has health issues, and that trying to get the matter resolved had caused stress.
  11. The Ombudsman’s remedies guidance for financial redress states that amounts over £1,000 should be paid when there have been serious failings by the landlord which had a detrimental impact on the resident.
  12. The total amount offered by the landlord reflects the severity of the failing, the level of detriment caused to the resident and the time he spent pursuing the landlord. As such, the redress offered by the landlord was reasonable to remedy the distress and inconvenience caused to the resident. This finding is made on the basis that the landlord has paid the total amount offered.

Determination

  1. In accordance with paragraph 53(b) of the Housing Ombudsman Scheme, the landlord offered redress which, in the Ombudsman’s opinion, satisfactorily resolves its handling of the resident’s concerns about his rent account.