Personal Budgets and Direct Payments

A personal budget is the overall cost of care and support the local authority and/or health service provides for a disabled child or young person who has extra needs.

A personal budget can be used for:

• Employing  a personal assistant (PA) or for purchasing care and support services:
• Buying specialist equipment not provided by the NHS;
• Paying for leisure or educational activities and transport costs.

Direct payments are monetary payments made to assist with meeting a child or young person’s assessed need by the relevant body to fund part or all services as an alternative to commissioned services.

Local authorities must offer the option of Direct Payments in place of services currently being received. For both education and social care, the local authority/practitioner must be satisfied that the parent, nominated person or young person (who is over the age of 16):

• Is able and capable of manging the Direct Payment either by themselves or with whatever help the authority thinks will be  appropriate;
• Is the most appropriate way of arranging the required support or services rather than commissioned services from the relevant body;
• Will use the direct payment in an appropriate way to meet the needs of the child/young person and will act in the best interests of the child or young person.

The options of controlling the personal budget/direct payment are the following:

1. Direct payments – where the young person/parents/ nominated person buys, employs and arranges the services themselves such as employing a personal assistant, taking on certain responsibilities as an employer;
2. An arrangement – where the Local Authority, school or college hold the funds and arranges the services (also known as notional budgets);
3. Third party arrangements – where the funding is paid to a person or organisation who acts on behalf of the parents, nominated person or young person.

Direct payments for education are monetary payments to parents of a child with an Education, Health and Care Plan (EHCP) and should be specified in the EHCP. These include requirements to consider the impact on other service users, taking account of value for money and to seek agreement from educational establishment where a service funded by a Direct Payment is delivered on their premises.

Direct Payments for health require the agreement of a Care Plan between the Integrated Care Board (ICB) and the recipient. Direct payments and Personal Budgets also apply to young people who require Aftercare under Section 117 of the Mental Health Act 1983, children and young people receiving Continuing Health Care funding and people eligible for an NHS wheelchair (personal wheelchair budgets).

A direct payment may be agreed if a disabled child/young person is eligible through a Care Plan, children in need plan or short breaks plan (LA funded), or the family’s needs (by virtue of their role as carers assessed through a carers assessment for a disabled child) or who have Education, Health and Care Plans (EHCP), which may contain elements of education, social care and health funding. Under the Children and Families Act 2014, this covers those aged 0-25 having special educational needs and disabilities.

Direct payments are given to 16 and 17 year old disabled young people directly rather than to their parents or carers. The young person can then decide which services to use. This only applies if the young person is able to organise their own care and support. 

Direct Payments can also be made to a willing and appropriate person on a child or young person’s behalf if they lack the mental capacity to agree to and manage Direct Payments themselves.

Direct Payments cannot be used to pay for services from a spouse, partner or a close relative living in the household unless the local authority consider it is necessary to do so. However, a direct payment can be used to employ a relative if they are not living in the household.

Direct Payments are usually paid in advance into a bank or building society account specifically set up for this purpose, as a one off payment or on a 4 weekly basis and this bank account should not be used for any other purpose. If the direct payment is assessed as being needed at key times e.g. school holidays, then payment will be made accordingly.

• The child and/or family's needs are first assessed by a Social Worker;
• As well as completing an Initial Assessment of Need, they will also make an assessment as to whether the parent/carer or young person is willing and able to administer direct payments, with appropriate support being provided;
• The Social Worker will then present a request to a Resource Panel of Managers and service providers who will decide whether Direct Payments are the most appropriate option to meet the need and how the funds should be allocated;
• Once agreed, the Direct Payment Manager will contact the person concerned to explain how the scheme works and draw up a 'Letter of Agreement', discuss any PA recruitment needs and initiate direct payments with the finance team;
• A Direct Payments Advisor will then visit to explain in detail  the responsibilities of the recipient of the direct payment as an employer and will continue to give on-going support and advice as required;
• Ongoing review of the direct payment will be made jointly between the Direct Payment Advisor and the social worker to ensure the needs of the child continue to be met and the money administered appropriately;
• Those direct payments not used within a three month period will be returned to the Local Authority.

• To take the young person/child into the community to access an activity, support inclusion, going to a club etc.
• To work with the child directly within the home, to give parents and siblings a break;
• To stay overnight for a short break.

• Using an approved agency to provide direct care to meet your child/family's needs;
• After school clubs and holiday play schemes for your child with disabilities;
• Residential overnight breaks for your child with disabilities;
• By agreement with the Team Manager for direct payments, any service which meets your assessed need for a short break.

It could well be that those in receipt of Direct Payments require stays in hospital. This would not necessarily mean that the Direct Payments should cease. Guidance advises that consideration should be given by the local authority, the carer, the holder and NHS Trust to as to how the payments might be used to meet non-health needs or to ensure that the employment arrangements can be maintained. For example, the holder may prefer some personal care tasks to be undertaken by the carer rather than hospital staff. However, the personal care and medical input need to be tailored so as not to interfere with the medical treatment. (Terminating or suspending the carer’s employment may lead to a delay of continuity of care and a delay in discharge).

In instances where the authorised or nominated person requires hospital treatment, the local authority must conduct an urgent review to ensure the holder continues to receive the care and support they need. This might include the duties to be carried out by a temporary nominated person, or through short-term authority arranged care/support.

• Employing someone without DBS and CPR checks or references;
• Permanent residential accommodation, though they can be used for occasional short breaks, if the local authority agrees, for up to 120 days in any 12 month period. (Note: where two periods of short –term care are 4 weeks or less apart, then the cumulative total of the stays should be added and not exceed  4 weeks if the stay  is to be funded by Direct Payments).

Direct Payments allow parents and young people greater choice, flexibility and control, to employ their own workers at times convenient to them and in the way they wish, to provide an individual service to meet their needs. Payments made do not affect welfare benefits as they are not classed as income.

Before a young person is 18, it is important that a young person is assessed through the transition process to meet the statutory duty of both the Care Act and the Children and Families Act and to decide if Adult Social Care is needed and to establish what care and support is still needed or required. This will include whether a direct payment is being offered.

It is important to note once a young person reaches 18, the care and support package is means tested and a financial assessment will be completed by the local authority to look at what contribution is necessary from the young person’s finances (which does include benefits).