St Mungo Community Housing Association (202114501)

REPORT

COMPLAINT 202114501

St Mungo Community Housing Association

19 October 2023

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:
   1. The resident’s rent account and its response to her request to write off rent arrears.
   2. The resident’s complaint.

Background

2. The landlord employs a third party managing agent who are responsible for the daily housing management of its stock. The Ombudsman views any third party agents acting on behalf of the landlord to be an extension of the landlord, as such, in this report said management agent will be referred to as “the landlord”.
3. The resident is a former licensee of the landlord. Her occupancy dates were 11 June 2018 to 31 March 2022. This was self- contained supported accommodation, comprising of a bedroom, kitchen and bathroom for the resident’s sole use. The rent inclusive of service charge was £231.28 per week at the time of the complaint.
4. The landlord no longer manages this property and the resident now holds an assured tenancy in alternative accommodation. The resident was a full time student at the time of the complaint. The landlord records note complex vulnerabilities for the resident, in the form of serious mental health issues.
5. The resident first complained to the landlord on 3 January 2020, after she received an arrears notification letter. Her arrears as of 18 December 2022 were £2986.52. She complained that she did not know her housing benefit had stopped, as she had been wrongly advised by the landlord that she would continue to be entitled to full housing benefit when she started her university course in September 2019. She further stated that the landlord advised her that she could spend her student finance on things other than rent. She further stated that her ability to move to permanent accommodation had been affected due to the rent arrears.
6. In its complaint response of 12 March 2020, the landlord confirmed that the resident had arrears of £3761.88 and that housing benefit had not been paid since 23 September 2019 when she started her full time university course. It acknowledged that:
   1.  It had wrongly advised the resident regarding her housing benefit entitlement.
   2. The support worker at the time should have sought advice from its in house welfare benefit expert, who should have given the resident advice at the time.
   3. It had subsequently contacted its welfare benefits expert in December 2020 and they confirmed that the resident would only be entitled to housing benefit (HB), if she was in receipt of a personal independence payment (PIP).
   4. It assisted the resident to apply for PIP, set up an affordable repayment plan and applied to various grant giving organisations to assist with the rent arrears.
   5. It advised that it would communicate with its rents team to hold off on any further arrears action whilst the resident kept to her repayment plan.
7. The resident submitted a further complaint on 28 July 2021. She advised she was not happy with the outcome of the complaint response in March 2020. She asked the landlord to clear the arrears due to the fact that she had been given the wrong advice as stated previously. She wanted the arrears cleared and for the landlord to move her to more affordable accommodation.
8. In its Stage 2 complaint response of 19 August 2021, the landlord once again acknowledged that it had originally misinformed her about her eligibility for HB whilst a full time university student, not in receipt of PIP. It also acknowledged that it had missed opportunities to support the resident around managing her situation. The landlord advised the resident that it would support the resident to apply for more grants to clear the arrears. It advised it had asked senior management for help clearing the arrears but this had been refused and that it would do so again. It stated that its welfare benefits team had supported her in her PIP application, which had been successful and confirmed that the welfare benefits team had also helped her to apply for backdated HB, which was likely to be put into payment and backdated to when her PIP started. It also advised her that it would advocate on her behalf regarding her nomination for permanent housing.
9. The resident attempted to escalate her complaint further on 21 December 2021, as she had heard nothing back from the landlord, further to the actions agreed in its complaint response of 19 August 2021. The resident asked for this complaint to be considered as a Stage 2 complaint, but this was dealt with as a new/stage 1 complaint. She further complained about a staff member, who had met with her further to the complaint, advising that he had been unprofessional.
10. In its final complaint response to the resident on 14 January 2022, the landlord apologised to the resident for the staff member’s behaviour and for not following up on previous agreed actions. It advised that it would speak to the resident’s new key worker to request further grants and would submit another request to the service director to write off some of the rent arrears. It also advised the resident that it would attempt to contact the housing nominations provider to get an update on the resident’s permanent housing.
11. The landlord agreed to clear £3761.88 of the resident’s arrears on 10 March 2022.
12. As an outcome to her complaint, the resident would like financial compensation for the significant impact on her mental health and a policy change so that residents get accurate and tailored support according to their individual circumstances and needs.

Assessment and findings

Policies and Procedures

13. The landlord’s rent collection and arrears management policy states that it is vital that rent/licence charge is maximised. It goes on to say that it is also a fundamental part of the resettlement process for clients to recognise the importance of money management and debt prioritisation to prepare them for independent living.
14. It goes on to say that the above process is achieved through ‘effective rent/licence charge management (including housing benefit claims) and providing ‘comprehensive pre-tenancy information and advice’. The policy places an emphasis on providing residents with advice and support to establish any housing benefit entitlement and work with budgeting issues. It states that it will ensure clients have the means to pay rent and will provide ongoing support around managing rent/licence charge.
15. The landlord operates an arrears process, where it sends resident rent arrears notification letters from 2 to 9 weeks on a sliding scale of action required by the resident and arrears action the landlord will take, commensurate with the arrears. It also has an appeals process regarding rent arrears and any enforcement action therein.
16. The landlord operates a discretionary compensation policy where it states that compensation may be payable when a complaint has had a cumulative impact; for example, where it has caused distress and inconvenience or other adverse effect. Its guidelines say it will pay between £250 – £700 where the impact experienced by the complainant could include distress and inconvenience, time and trouble, disappointment loss of confidence and delays in getting the matter resolved.

The landlord’s handling of the resident’s rent account and its response to her request to write off the arrears.

17. The records show that the landlord acted appropriately in issuing the resident with arrears notification letters as per its policy and that it did contact her to attempt to discuss the situation. Furthermore, it was appropriate that the landlord support staff successfully advocated on the resident’s behalf when she was issued with possession proceedings due to her arrears. However, there were various failings in the execution of its policy, in terms of the initial advice it gave to the resident regarding her rental/service charge liabilities.
18. There is no dispute that the landlord did not correctly follow its policy in terms of rent collection and arrears management in terms of the advice it gave the resident in respect to her HB entitlement. It was appropriate that it acknowledged its failings in that it had provided the resident with incorrect information regarding her entitlement to housing benefits. It also appropriately acknowledged that it had mistakenly advised her that she did not need to use her student finance to pay her rent. The landlord went some way to seek to put things right and provide redress to the resident, by referring her to its specialist welfare benefits service and assisting her to apply for PIP and backdated HB. It also assisted her to apply for various grants. Additionally, in its stage 2 complaint response, it apologised for any distress caused to her by the staff member in respect of her additional complaint. However, it did not apologise to the resident in its original complaint response of 12 March 2020. Due to the failings, the resident suffered significant adverse effect due to her mental health and the landlord did not go far enough to address the adverse effect caused by its failings.
19. Although the landlord went above and beyond its policy position by writing off £3761.88 of the arrears (the arrears caused by the landlord’s incorrect advice), it did not do this until 2 years after the resident’s original complaint. The landlord did not act in a timely manner and the redress offered to the resident was well outside of its published independent complaints process timescales. This caused the resident additional stress and anxiety as well as time and trouble. In addition, it did not offer the resident any financial compensation for the adverse effect caused and it would have been reasonable for it to so, on top of the contribution to her arrears. Furthermore, the arrears on the resident’s account, may well have contributed to the significant wait for the resident to be rehoused into permanent social housing. This is because many prospective landlords may be reluctant to permanently house residents who are in significant arrears.
20. Furthermore, internal email correspondence shows that there were communication failings between staff departments in respect of the arrears and actions taken, which could have contributed to the time taken to resolve the issues. The landlord correspondence of December 2019 shows that support staff had informed its rent team of the reasons why the resident was not in receipt of HB and received no response. This delay in communication was a failing on the part of the landlord. Had the departments responded sooner, the arrears may have been addressed sooner and the situation may not have escalated. The landlord missed an opportunity to act on the resident’s arrears and provide her with the appropriate communication and advice sooner.
21. The landlord’s records show that although a previous repayment and budget plan had been in place, the landlord acknowledged that this was not explained fully to the resident in terms of how much she needed to pay and how to manage her money. This is a failing in communication on the part of the landlord and contrary to its policy.
22. Additionally, although the landlord devised an action plan to address the arrears issues in August 2021, the landlord did not carry out any of the actions it had undertaken to, until January 2022, when the resident submitted a further complaint. The only mitigation the landlord offered was that a staff member had been on annual leave for some weeks. This is an inappropriate delay and did not account for the period of 5 months. This caused the resident additional distress, frustration and time and trouble. These further delays had a detrimental impact on her mental health.
23. Although the landlord went some way to put things right in that it apologised, agreed a payment plan, assisted the resident to access housing benefits and  PIP, and paid off a sum of her arrears, it did not go far enough. The landlord client record management system (CRM) also lists lessons learned from the complaint, which include staff training and induction, regular reviews of arrears across the service and a review of welfare rights training needs. Although it is appropriate that the landlord listed lessons learned from the complaint,  these lessons learned were not shared with the resident so she was unaware that any actions would be taken to prevent a recurrence of the failings. Additionally, the landlord’s actions were not commensurate with its lessons learned. The resident was left for a significant period of time, feeling unheard, which exacerbated the distress and inconvenience caused. Due to the failings outlined above, the time it took the landlord to provide redress to the resident, and the significant adverse effect on the resident, a finding of maladministration is made, along with orders for redress.

Policies – the landlord’s complaint handling.

24. Although this Service is aware that the landlord has now adopted a revised policy in line with The Housing Ombudsman’s complaint handling code (the Code), the investigation will focus solely on the policy at the time of the complaint.
25. The landlord’s policy at the time defines a complaint as ‘an expression of dissatisfaction about the service or treatment a person is receiving’ from the landlord.
26. The landlord operates a two stage complaints process.
    1. Stage 1 – Complaints are acknowledged within 2 working days of receipt and investigated and responded to within 15 working days.
    2. Stage 2- The landlord will write to the resident within 10 working days of receipt ‘of the appeal’ and advise that a Stage 2 investigation will take place. Residents will receive a response within 25 working days of acknowledgement of receipt of the Stage 2 complaint.
27. For both complaint stages the landlord states that all aspects of the complaint are noted on their client record management system (CRM) and an outcome is given for each aspect of the complaint. Complaint responses should also clarify what will be done to resolve the complaint and to improve the service as a result of the complaint. If timescales cannot be met, the complainant must be informed in writing of when they will receive a response.
28. The policy goes on to state that complainants may appeal when any aspect of the complaint has not been upheld or partially upheld or they are not satisfied with the method of redress. It further states that appeals will only be considered within 2 months of receipt of the complaint response, unless there are exceptional circumstances, such as the seriousness of the complaint or ill health.

The landlord’s handling of the resident’s complaint

29. The landlord’s complaints policy at the time of the complaint was not in line with the Housing Ombudsman’s complaint handling code, in terms of timescales for responding to complaints.
30. The resident submitted her first complaint to the landlord on 3January 2020 and did not receive a response until 12 March 2020. This is significantly outside of both this Service’s complaint handling code and the landlord’s own timescales. Furthermore, it did not communicate with the resident to advise of the delay. significant delay in responding to the resident caused her distress and frustration. Although it is appropriate that the landlord wrote to the resident on 8 January 2020, to acknowledge her complaint, it advised her it aimed to provide a response to the complaint by 17 January 2020 and would let her know if it needed more time. There is no evidence that the landlord contacted the resident between its acknowledgement and the complaint response date of 12 March 2020 and this would have contributed further to the resident’s distress and frustration. The landlord did however address all the points in the resident’s complaint as was appropriate.
31. When the resident raised a complaint on 28 July 2021 to advise that she was unhappy with the previous complaint response and wanted the arrears cleared and to be supported to move to new accommodation, the landlord went beyond its obligations in accepting this complaint as a stage 2 complaint as this was raised 1 year and 4 months after the original complaint response. However, the landlord’s CRM log has the complaint logged as a Stage 1 complaint, even though this was accepted as a stage 2. This is confusing and points to some discrepancies in the landlord’s record keeping.
32. Although the landlord provided a comprehensive action plan to the resident on 19 August 2021, the records show that there was no communication with the resident and this was not followed up until the resident raised a follow on complaint on 21 December 2021. This caused the resident additional distress and frustration and time and trouble.
33. Due to the confusion in the previous complaint record keeping, although the resident wanted to escalate the complaint from July 2021, the resident’s complaint of 21 December 2021 was categorised as a Stage 1 complaint. Although this may have been appropriate, the internal landlord records show that staff were unaware how to categorise or deal with complaints in cases where residents wanted to appeal stage 1 appeal responses. This points to a training need on the part of the landlord’s staff and is a failing on the part of the landlord.
34.  On 7 January 2022, the landlord did communicate to the resident that her complaint of 23 December 2021 would be investigated under stage 1 of its complaints procedure, so it went some way in responding appropriately. It also advised her she would receive a complaint response within 10 working days.
35. It responded to the resident on 14 January 2022, which is within its own timelines. It apologised to the resident for not acting on previous action plans in a timely manner and issued a new timeline with agreed actions to be completed by 31 January 2022. This was a reasonable and appropriate response by the landlord.
36. However, it advised the resident that she could contact this Service if she was unhappy with the outcome of her complaint. As the resident was advised the complaint was dealt with as a stage 1 complaint, it is unclear if the landlord’s internal complaints process was finalised. Indeed, this Service initially sought further clarification from the landlord on receipt of the landlord’s evidence. This may have prolonged the length of time to finalise the complaint response. As such, a finding of service failure is made, along with orders for redress.

Determination

37. In accordance with paragraph with Paragraph 52 of the Housing Ombudsman Scheme, there was maladministration in the landlord’s handling of the resident’s rent account and its response to her request to write off the rent arrears.
38. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was service failure in the landlord’s complaint handling.

Orders

39. Within four weeks of this report the landlord is ordered to:
    1. Apologise to the resident for the failings identified in this report.
    2. Pay the resident £400 compensation as a remedy to the distress and inconvenience caused by its failings in its management of the resident’s rent account.
    3. Review the complaint handling failures in this case to determine what action has been or will be taken to prevent a recurrence of these.
    4. Pay the resident £100 compensation for the distress and inconvenience caused by its complaint handling failures.
40. The landlord should provide this Service with evidence of the compliance with the above orders.

 Recommendations

41. The landlord should ensure that its frontline colleagues are fully trained in its rent management policy and procedures.
42. The landlord should ensure that all relevant colleagues are trained in its complaint handling policy and procedures.