BRIEFING PAPER
Number 03735, 20 May 2015
Social care: Direct
Payments from a local
authority (England)
By Tim Jarrett
Inside:
1. Background and legislation
2. What are Direct Payments
3. Eligibility for direct payments
4. How much funding will be
provided?
5. What Direct Payments can
and cannot be used for
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Number 03735, 20 May 2015
Contents
Summary
3
1.
Background and legislation
4
2.
What are Direct Payments
5
3.
Eligibility for direct payments
6
4.
4.1
4.2
How much funding will be provided?
Direct Payments and other way of meeting needs
Can the cost of direct payments exceed a personal budget?
8
8
9
5.
5.1
5.2
5.3
What Direct Payments can and cannot be used for
Payment of family members
Care home stays
No requirement to procure services from any particular person
Cover page image copyright: Attributed to: DSC_6742 by Philippa Willitts. Licensed
under CC BY 2.0 / image cropped
11
11
12
12
2
3
Social care: Direct Payments from a local authority
Summary
Direct payments enable a person requiring social care to procure that care for themselves.
They can be used instead of, or together with, services provided by a local authority (either
directly or through a third party), although there are some restrictions on how direct
payments can be used.
The following Library papers might also be of interest:
•
Social care: paying for care homes places and domiciliary care (England) (SN01911)
•
NHS Continuing Healthcare in England (SN06128).
This note applies to England only.
Number 03735, 20 May 2015
1. Background and legislation
Direct payments were first introduced in 1997 under the Community
Care (Direct Payments) Act 1996. Initially, local authorities were given a
power, rather than a duty, to make payments for working age disabled
adults. The Government indicated that the user group for direct
payments could be expanded without the need for further legislation,
should the system prove successful.
In 2000, the discretion under the 1996 Act was extended to include
older people.
Further legislation was introduced in 2001 to include parents of disabled
children and also carers. 1
A duty to provide direct payments was introduced in 2003 when
regulations made under section 57 of the Health and Social Care Act
2001 made it mandatory for councils to make direct payments to
individuals who consented to and were able to manage them with or
without assistance. 2
In 2009, provision was extended to persons appointed to receive direct
payments on behalf of individuals who lack mental capacity and to
persons subject to mental health legislation. 3
Direct Payments are made under sections 31 to 33 of the Care Act 2014
– with the Care and Support (Direct Payments) Regulations 2014 (SI
2014/2871) providing the details of policy implementation for local
authorities – and also section 117(2C) of the Mental Health Act 1983.
1
2
3
Carers and Disabled Children Act 2000 which inserted new section 17A into the
Children Act 1989
Community Care, Services for Carers and Children’s Services (Direct Payments)
(England) Regulations 2003 (SI 2003/762). Since revoked and replaced by the
Community Care, Services for Carers and Children’s Services (Direct Payments)
(England) Regulations 2009 (SI 2009/1887)
Community Care, Services for Carers and Children’s Services (Direct Payments)
(England) Regulations 2009 (SI 2009/1887)
4
5
Social care: Direct Payments from a local authority
2. What are Direct Payments
As the Department of Health notes in its Factsheet on the Care Act
2014:
A direct payment is a payment of money from the local authority
to either the person needing care and support, or to someone else
acting on their behalf, to pay for the cost of arranging all or part
of their own support. The local authority could make a direct
payment instead of arranging or providing any services itself, if
the adult asks them to do so. This ensures the adult can take full
control over their own care. The local authority must provide a
direct payment to someone who meets the conditions in the Act
and regulations. 4
4
Department of Health, Care Act factsheets – Factsheet 4: personalising care and
support planning, updated 4 February 2015
Number 03735, 20 May 2015
3. Eligibility for direct payments
A person may make a request for direct payments, although how that
request is handled depends on whether the person in respect of whom
the request is made has the “mental capacity”, which is defined as “the
ability to make a decision”. 5
For people who have mental capacity, under the Care Act 2014 they
must meet all four conditions, as set out in the CSSG which states that:
These conditions need to be met in their entirety; a failure in one
would result in the request to receive a direct payment being
declined. The conditions are:
•
•
•
•
the adult has capacity to make the request, and where there is a
nominated person, that person agrees to receive the payments;
the local authority is not prohibited by regulations under section
33 from meeting the adult’s needs by making direct payments to
the adult or nominated person;
the local authority is satisfied that the adult or nominated person
is capable of managing direct payments either by himself or
herself, or with whatever help the authority thinks the adult or
nominated person will be able to access;
the local authority is satisfied that making direct payments to the
adult or nominated person is an appropriate way to meet the
needs in question. 6
For people lacking the mental capacity to request a direct payment, the
following conditions “must be met in their entirety”:
•
•
•
•
•
where the person is not authorised under the Mental Capacity Act
2005 but there is at least one person who is so authorised, that
person who is authorised supports the person’s request;
the local authority is not prohibited by regulations under section
33 from meeting the adult’s needs by making direct payments to
the authorised person, and if regulations under that section give
the local authority discretion to decide not to meet the adult’s
needs by making direct payments to the authorised person, it
does not exercise that discretion;
the local authority is satisfied that the authorised person will act in
the adult’s best interests in arranging for the provision of the care
and support for which the direct payments under this section
would be used;
the local authority is satisfied that the authorised person is
capable of managing direct payment by himself or herself, or with
whatever help the authority thinks the authorised person will be
able to access;
the local authority is satisfied that making direct payments to the
authorised person is an appropriate way to meet the needs in
question. 7
It should be noted that there are some groups who are ineligible for
Direct Payments, even if they meet the conditions outlined above. 8 The
5
6
7
8
Department of Health, Care and Support Statutory Guidance, October 2014, p203,
paras 12.10–12.11
As above, p204, para 12.14
As above, p205, para 12.17
Under regulation 2 of the Care and Support (Direct Payments) Regulations 2014 (SI
2014/2871), Schedule 1 lists those “adults whose needs the local authority must not
meet by making direct payments”.
6
7
Social care: Direct Payments from a local authority
CSSG notes that “the Regulations sets out that direct payments cannot
be made to people subject to a court order for a drug or alcohol
treatment program or similar schemes”. 9
9
Department of Health, Care and Support Statutory Guidance, October 2014, p206,
paras 12.20
Number 03735, 20 May 2015
4. How much funding will be
provided?
4.1 Direct Payments and other way of
meeting needs
Under the Care Act 2014, the term “meeting needs” replaces the
previous terminology of “providing services”. The CSSG argues that
“meeting needs” is an “important concept” which “intended to be
broader than a duty to provide or arrange a particular service”:
“because a person’s needs are specific to them, there are many ways in
which their needs can be met”. 10
The CSSG explains that needs are met through care and support
planning, adding that direct payments can be the sole way of procuring
services to meet needs, or used in combination with other approaches
to provide services:
There are a number of broad options for how needs could be
met, and the use of one or more of these will depend on the
circumstances. Section 8(2) of the Act gives some examples of
ways of meeting needs, and would cover:
•
the local authority directly providing some type of support,
for example by providing a reablement or short-term
respite service;
•
the local authority arranging for a care and support
provider to provide some type of support, for example by
commissioning or contracting with a provider;
•
making a direct payment, which allows the person to
purchase their own care and support; or
•
some combination of the above, for example the local
authority arranging a homecare service whilst also
providing a direct payment to meet other needs. 11
In addition, a direct payment is only one of four ways in which a
“personal budget” (see below) can be managed, as set out in the CSSG:
10
11
12
•
as a managed account held by the local authority with
support provided in line with the persons wishes;
•
as a managed account held by a third party (often called an
individual service fund or ISF) with support provided in line
with the persons wishes;
•
as a direct payment […]
•
a ‘mixed package’ that includes elements of some or all
three of the approaches above. 12
As above, p169, para 10.10
As above, p169, para 10.11
As above, p194, para 10.30
8
9
Social care: Direct Payments from a local authority
4.2 Can the cost of direct payments exceed a
personal budget?
The Care Act 2014 put the concept of a “personal budget” onto the
statute book for the first time. 13 The CSSG explains that “the personal
budget is the mechanism that, in conjunction with the care and support
plan, or support plan, enables the person, and their advocate if they
have one, to exercise greater choice and take control over how their
care and support needs are met”. 14
The Care Act 2014 states that “the personal budget must be an amount
that is the cost to the local authority of meeting the person’s needs”;
however, “consideration should also be given as to whether the
personal budget is sufficient where needs will be met via direct
payments, especially around any other costs that may be required to
meet needs or ensure people are complying with legal requirements
associated with becoming an employer”. 15
However, this does not mean that where providing direct payments
would be more expensive than, say, local authority provided services,
that direct payments should always be provided. The CSSG states that
“a request for needs to be met via a direct payment does not mean that
there is no limit on the amount attributed to the personal budget”. The
CSSG notes that “it is more appropriate to meet needs via directlyprovided care and support” if there is no alternative provider in a local
market, or “the costs of an alternate provider arranged via a direct
payment would be more than the local authority would be able to
arrange the same support for, whilst achieving the same outcomes for
the individual”. 16
The CSSG does provide some examples of where a personal budget
should be increased to allow services to be purchased through direct
payments, noting that “in all circumstances, consideration should be
given to the expected outcomes of each potential delivery route”:
It may be that by raising the personal budget to allow a direct
payment from a particular provider, it is expected to deliver much
better outcomes than local authority delivered care and support,
or there may be other dynamics such as the preferred option
reducing the need for travel costs, or out of hours care. In
addition, efficiencies to the local authority (for example through
an individual making their own arrangements) should also be
considered. Decisions should therefore be based on outcomes and
value for money, rather than purely financially motivated. 17
Where a direct payment arrangement will cost more than is budgeted
for in a personal budget, the CSSG advises that:
the care plan should be reviewed to ensure that it is accurate and
that the personal budget allocation is correct. The authority
13
14
15
16
17
For more information on the personal budget, see section 1 of the Library paper
Social care: paying for care homes and domiciliary care (England) (CBP01911)
Department of Health, Care and Support Statutory Guidance, October 2014, p187,
paras 11.2–11.3
As above, p192, para 11.25
As above, p193, para 11.26
As above, p193, para 11.27
Number 03735, 20 May 2015 10
should work with the person, their carer and independent
advocate (if there is one) to agree on how best to meet their care
and support needs. It may be that the person can take a mixture
of direct payment and local authority-arranged care and support,
or the local authority can work with the person to discuss
alternate uses for the personal budget. Essentially, these
discussions will take place during the planning process and local
authorities should ensure that their staff are appropriately trained
to support personalised care and support, and to facilitate
decision-making. 18
18
As above, p193, para 11.28
11 Social care: Direct Payments from a local authority
5. What Direct Payments can and
cannot be used for
As the CSSG states: “The direct payment is designed to be used flexibly
and innovatively and there should be no unreasonable restriction placed
on the use of the payment, as long as it is being used to meet eligible
care and support needs”. 19
However, there are some restrictions on the use of Direct Payments, as
set out in the following sub-sections.
5.1 Payment of family members
Under the current rules, a Direct Payment can be made to pay a
member of the close family living in the same household in respect of
the provision of “management and/or administrative support to the
direct payment holder” and only in those cases “where the local
authority determines this to be necessary”. 20
In the explanatory memorandum to the regulations, the Department of
Health explained:
This change is intended to allow local authorities to make
managing direct payments less onerous by allowing a nominal
payment to be paid to a family carer, similar to the way direct
payment holders can pay agencies to manage aspects of the
payment on their behalf. This can be helpful where a person may
have multiple, complex needs and may have several different care
workers to arrange and manage. 21
However, it remains the case that direct payments cannot usually be
made to a close family member living in the same household as the
person in receipt of a direct payment. Ordinarily, the regulations
prevent direct payments being made to:
19
20
21
a)
the spouse or civil partner of the adult;
b)
a person who lives with the adult as if their spouse or civil
partner;
c)
a person living in the same household as the adult who is
the adult's—
(i)
parent or parent-in-law,
(ii)
son or daughter,
(iii)
son-in-law or daughter-in-law,
(iv)
stepson or stepdaughter,
(v)
brother or sister,
(vi)
aunt or uncle, or
(vii)
grandparent;
As above, p210, para 12.35
As above, p211, para 12.36
Explanatory Memorandum to the Care And Support (Direct Payments) Regulations
2014, 2014 No. 2871, p2, para 7.4
Number 03735, 20 May 2015 12
d)
the spouse or civil partner of any person specified in subparagraph (c) who lives in the same household as the
adult; and
e)
a person who lives with any person specified in subparagraph (c) as if that person's spouse or civil partner.
However, there is not a total ban on direct payments to such family
members; under regulation 3(2) it continues to be the case that direct
payments can be used to pay them “if the local authority considers it is
necessary to do so”.
5.2 Care home stays
In most cases, a direct payment cannot be used to fund a long-term stay
in a care home. The exceptions are those local authorities where the
Government is currently testing the use of direct payments in care
homes, 22 with the aim of introducing the policy across England in 2016.
For all other local authorities, direct payments can be used to fund a
short stay in a care home, defined as not exceeding a period of four
consecutive weeks in any 12 month period; the break between stays in
a care home needs to be more than four weeks in order for them not to
count as a single stay.
If a stay of more than four weeks in total does occur, then a person
“cannot use their direct payments to pay for any more home services
care until 12 months have passed from the start of the four-week
period”. 23
However:
People can receive additional weeks in a care home once they
have reached the four-week maximum. They cannot purchase the
stay using their direct payments, but if the local authority and the
person agrees that a longer stay is needed, it can still arrange and
fund stays for the person. There is no restriction on the length of
time for which the local authority may arrange such
accommodation for someone (see chapter 8 for guidance on
choice of accommodation). 24
5.3 No requirement to procure services from
any particular person
Regulation 4(3)(a) states that, when making a direct payment, one of
the things that a local authority cannot make a condition is that the
person in receipt of direct payments has to have their needs met by
“any particular person”.
22
23
24
The list of “trailblazer” local authorities is set out in Schedule 2 of the Care and
Support (Direct Payments) Regulations 2014 (SI 2014/2871) and includes: Bristol City
Council, Cornwall Council, Dorset County Council, Gateshead Council, Hertfordshire
County Council, Hull City Council, Lincolnshire County Council, London Borough of
Enfield, London Borough of Havering, London Borough of Redbridge, Manchester
City Council, Milton Keynes Council, Norfolk County Council, North Lincolnshire
Council, Nottinghamshire County Council, Staffordshire County Council, Stockport
Council, and Surrey County Council.
Department of Health, Care and Support Statutory Guidance, October 2014, p212,
para 12.43
As above, p212, para 12.44
13 Social care: Direct Payments from a local authority
The Department of Health explained that this provision, new to the
2014 direct payment regulations, “is intended to support the policy
intention for direct payments to be used innovatively and flexibly, and to
prevent local authorities from stating that a direct payment can only be
used with a particular provider”. 25
25
Explanatory Memorandum to the Care And Support (Direct Payments) Regulations
2014, 2014 No. 2871, p2, para 7.5
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BRIEFING PAPER
Number 03735, 20 May 2015
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