Birmingham City Council paid out £105,275 in compensation during the past year after the ombudsman was forced to step in to deal with complaints.

The watchdog received 522 complaints and inquiries about the city council in the past 12 months, according to an annual report by local government ombudsman (LGO) Anne Seex. Of those, it had to step in to resolve 240 complaints involving housing, adult care services, education, benefits and antisocial behaviour.

Complaints included a case in which the council had delayed for 16 months in processing a disabled facilities grant scheme for a ground-floor rear extension.

It also failed to communicate effectively over the amended plans, resulting in a compensation claim of £4,635.

This is one of 132 cases settled by the council during 2008/2009 and highlighted in the review, although not all claims result in financial remedies.

The authority’s rate of local settlements, which means it has taken action after the ombudsman has stepped in, is 45.3 per cent compared to 27.4 per cent nationally.

The compensation payout has fallen from £109,826 the previous year and £151,097 in the 12 months to 2007.

There were nine local settlements in Children and Family Services complaints. In three of these cases financial remedies between £18,000 and £24,000 were agreed.

Two of the complaints concerned foster care. In one, an assessment of a couple was subject to severe delay. The individuals were inappropriately assessed and not fully advised of the needs and circumstances of the two youngsters placed with them.

In another case a complainant was caused unnecessary distress by the council’s mishandling of deregistration procedures for foster carers, including a confused preliminary investigation and the presentation of flawed evidence to a fostering panel.

The third case concerned the council’s failure to carry out an assessment of a seriously disabled child until the child was a teenager.

There was a complaint about the loss of a child’s files and another one about the lack of services and financial help for a young person in care.

The report showed that the council had improved the average time taken to respond to inquires by the ombudsman, but it still fell short of the 28-day target.

The average time taken to reply to initial inquiries on 145 complaints was 33.4 days.

Fiona McEvoy, campaign agent for the West Midlands TaxPayers’ Alliance said more needed to be done. She said: “Mistakes on behalf of the Birmingham City Council are costing us as taxpayers, not just in compensation payments, but also for the expensive administration that exists to process and investigate all these complaints.

“We can only hope that the council will take every measure to avoid making such expensive errors in the future because hard-working Birmingham residents can ill-afford to pick up the bill at this time of recession”.

A spokesperson for the city council said: “The local government ombudsman published the annual review for 2008/09 for local authorities within the region.

“Birmingham is the largest of these and makes a variety of local settlements of complaints received from the LGO.

“Each year some involve financial settlements which may be for the reimbursement of out-of-pocket expenses, to time-and-trouble payments of around £250 up to, rarely, substantial settlements for very serious complaints.

“In such cases, the council always seeks to learn from the failings highlighted, reviewing policies and procedures to prevent a recurrence.”