Royal Borough of Kensington and Chelsea (202122327)

REPORT

COMPLAINT 202122327

Royal Borough of Kensington and Chelsea

24 May 2022

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:

a)     The historic water rate charges and the landlord’s calculation of the resident’s water rebate.

b)     The landlord’s failure to communicate information about a discount offered by the local water provider.

c)     The landlord’s response to the resident’s enquiries about the reinstatement of a resident’s association.

Background

2. The resident has been a tenant of the landlord since 2005. He moved to his current sheltered accommodation property under a secure tenancy on 27 January 2014.
3. The resident has been able to secure significant discounts to his water rates since direct billing from the water company started on 1 October 2019. He has therefore complained that he was being overcharged by the landlord prior to that date and wants a refund of those charges.
4. In response, the landlord explained that it was charged for its bulk usage by the water company and then split that charge up between its properties, based on the size of the property. It did charge an administrative fee for this, but all of the money it received from tenants for water rates was passed to the water company. As such, it could not agree that the resident had been overcharged. However, the landlord did offer a refund of the administrative fee up to August 2017, which is the point it stopped making an administrative charge.
5. The resident remains unhappy with the landlord’s response. He believes he has been overcharged and therefore disagrees with the landlord’s calculations. He also feels that the landlord is resistant to reinstating the residents’ association that could take such matters forward.

Assessment and findings

6. Prior to direct billing from the supplier beginning on 1 October 2019, the landlord was making a charge for water of £8.25 per week. Once the resident was dealing with the supplier directly, he was able to secure discounts that brought the weekly cost down to £2.63 per week. The resident therefore believes that the landlord should have applied the relevant discounts to his water charge. As it did not, it was overcharging him £5.62 per week and he wishes to be reimbursed for this. He has calculated this to be £2,987.86 for the period January 2004 to September 2019.
7. By asking to be reimbursed the above amount, the resident’s basic premise is that the landlord was being charged £2.63 per week for water to the property but was charging the resident £8.25 per week and then retaining the difference of £5.62 per week. However, that was not the case. The landlord was simply passing on the cost that it was being charged by the water supplier and was not benefitting financially from its bulk purchase. The landlord did make a charge for administrative costs, which it was entitled to do.
8. It perhaps should be more accurately expressed that, because the resident believes he has suffered financial detriment, he is seeking compensation equivalent to the amount he could have saved had he been able to get the discounted rates right from the beginning of his tenancy.
9. The resident considers the landlord to have been his water supplier and therefore it should have assisted him to get the cheapest possible rate. But although the resident paid the costs to the landlord, it was not the supplier. The landlord itself was a customer of the water company. It paid a certain amount for that supply and then, as already mentioned, simply split the cost proportionately between all of the properties. The landlord was not receiving the discount that the resident has subsequently benefitted from.
10. Prior to the start of direct billing in October 2019, tenants could apply directly to the water company for any available discounts. The water company would then forward any discounts to the landlord who could then apply the reduction to individual tenant’s accounts. The resident says that he contacted the water company in 2016 to discuss costs. However, he did not apply for the discount scheme at that time.
11. The landlord has offered the resident a refund of £160.86 for his first tenancy and £122.94 for his current tenancy. It has calculated these amounts based on Local Government Association Guidance. The landlord has also explained at length why the resident was not overcharged and why the refund only goes up to August 2017 (as the date it stopped charging an administrative fee). The landlord’s responses to the resident demonstrate that it has taken his complaint seriously and taken steps to address it in full. Overall, the Ombudsman is satisfied that the landlord has acted reasonably in response to the resident’s request for a refund of the water service charge.
12. The resident has complained that other tenants are still paying too much for their water supply. However, there is no evidence of the resident formally acting on behalf of any other tenants. As a result, the Ombudsman is unable to comment on this. The Ombudsman can however consider the resident’s particular point that the landlord should have communicated the water discount scheme to himself and others.
13. In its response to the resident’s complaint, the landlord has acknowledged that Housing Wardens could play a more active role in assisting vulnerable tenants to apply for the discount scheme and has arranged for details of the scheme to feature in its next round of newsletters. The Ombudsman understands that the water company sent leaflets to all properties prior to them becoming directly billed. It would have been helpful if the landlord had advertised potential discounts prior to direct billing happening in October 2019. However, the discount scheme is something that was set up and run by the water company. There is nothing in the resident’s tenancy agreement or in the landlord’s policies and procedures that requires it to act for the water company in cascading information about discounts and alternative tariffs. The absence of any awareness raising by the landlord does not amount to a service failure as there is no evidence that it was required to provide this information. By saying that it will be more pro-active in future about alerting tenants to the discount, the Ombudsman considers that the landlord’s response to the resident’s concerns about promoting the water discount scheme was reasonable.
14. The Ombudsman is aware that the resident’s sheltered housing scheme is already incorporated as a member of a larger residents’ association covering thirteen buildings. The Ombudsman is also aware that the resident’s scheme did have its own separate social group which had not been active recently due to not having the required designated officers, although the evidence shows that steps were being taken to try and revive the group.
15. The resident says he would like the residents’ association for his block to be reinstated so that issues such as water discounts could be voiced and brought to the wider attention of residents. This did not form part of the resident’s original complaint and therefore the Ombudsman is unclear why the resident believes that the landlord is opposed to this. However, the landlord took the opportunity to respond to it in its stage 2 response. It said that, contrary to the resident’s view, it had no reluctance in relation to the formation of a residents’ association but that it was up to the residents themselves to move this forward. The Ombudsman considers this to be a fair and reasonable response on the part of the landlord.

Determination

16. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration in the way the landlord responded to the resident’s dissatisfaction with the historic water rate charges and its calculation of the water rebate.
17. In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration in the way the landlord responded to the resident’s concerns about how water discounts were communicated.
18. In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration in the way the landlord responded to the resident’s concerns about reinstatement of the residents’ association.