Waltham Forest’s Personal Budgets Money Management Options
GUIDANCE (STAFF AND RESIDENTS)
Lots of people worry about managing their Personal Budget money but there are
many options that you can choose from, depending upon the level of responsibility
you feel able and willing to undertake. This fact sheet will focus on the different
methods available to manage your Personal Budget.
DEPLOYMENT OPTIONS IN WALTHAM FOREST
1. Personal Budget Cash Payment (formerly DIRECT PAYMENTS*)
A Personal Budget cash payment is the description used in Waltham Forest to
describe the old Direct Payment which is money paid from your council
directly to you. Since April 2003, every local council has had to offer those
who are eligible money to buy services or equipment as an alternative to the
council arranging services for them. Most people receiving social services
support have a right to Direct Payments. Changes to the law in 2009 now
mean that people who lack capacity (in terms of the Mental Capacity Act
2005) to consent to getting a Direct Payment can now receive payments in
this way. Direct Payments can now be made to a willing and appropriate
‘suitable person' such as a family member or friend who receives and
manages the money on the person's behalf.
This form of Direct Payments offers greater flexibility than before, but by
accepting this method of payment you take on the responsibility for managing
the money and arranging the services that meet your needs. You have to
make sure that you keep records to show that you have spent the Personal
Budget Direct Payment in the way you agreed with the council in your
support plan.
To receive a Personal Budget Direct Payment you need to open a separate
bank accountthat must only be used to manage your Direct Payment. You will
need to keep complete records of how the money is spent. All Bank
Statements from the account, and any invoices and receipts should be kept
for evidence. When the Council moves to an electronic paperless payment
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system (using, for example, prepaid virtual cards), we will adopt this way of
making the Direct Payment, and will no longer pay into your account and this
means that the requirement for holding and submitting the above
information will not be required as it will be managed through the system.
Personal Budgets Direct Payments can be used to employ your own Personal
Assistant (s). This means that you become an employer and take on the legal
responsibilities of being an employer. There is help available to make sure
that you have all of the legal requirements in place including support with
recruiting staff and managing the payroll (including all requirements of HM
Revenue and Customs in terms of tax). The council has a contract with
Disability Action to provide this service to personal budget holders free of
charge on its behalf.
Advantages of employing your own staff

You have flexibility in choosing who provides your support.

You gain long term familiarity with the person who is providing support.

You can receive support to recruit and employ your own staff.

You stay in control of your support and decide what tasks are done and what
hours are worked.

Disadvantages of employing your own staff

You have a lot of responsibilities and paperwork.

You have to manage people and pay their holidays, sickness and taxes.

Employing your own staff means there is no automatic cover in an
emergency.

You cannot use a Personal Budget direct payment to pay your husband,
wife or partner or pay a close relative who lives in the same house
(unless the council has agreed which is unlikely save in exceptional
circumstances).
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2. THE Council*
The Council can continue to manage your Personal Budget. Some people
choose to continue using their traditional services such as attending a day
centre, respite care or home care services. This is known as a Virtual Budget.
If the services you are getting now are working well and you do not wish to
change them the council will continue to provide the services and/or make the
payments on your behalf. The council can also make some payments by
transferring money to agreed organisations such as making the payment for
an annual gym membership.
If you want the council to manage your budget you do not have the same level
of flexibility and control that you have with other payment options. The council
usually contract with a list of providers that they will use to buy your care.
The advantages of this are:

The Council will have proper contracts with the organisation

The Council will ensure continuity of service is a supplier fails

The Council will pay suppliers and deal with any issues or complaints

The council will monitor the performance of suppliers

The council can provide support from staff where necessary
The disadvantages are:

You may not agree with the choice of supplier

The Council may move you from one supplier to another when contracts are
renegotiated

It may take longer to get your particular needs sorted out
*These options are currently available in Waltham Forest
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3. FUND - HOLDING AGENCY (INDEPENDENT THIRD PARTY)
If you do not want or feel able to manage the personal budget yourself you
can ask an independent third party to look after it for you. This can be a
community based support or advocacy organisation or an Independent
Broker. These can generally be charitable organisations, but could also be
Solicitors or Accountants.The independent third party takes the responsibility
of managing the money and keeping clear accounts, this will usually include
operating a payroll service. Some of these will/may have been vetted by the
Council and recommended from a list held by the Council. You may, of
course, select your own, but we would advise you to make sure that they have
a good reputation before getting them to manage your money.
The benefit of this approach ensures that you still retain control of the money
whilst the independent third party takes responsibility for the legal and
financial duties involved. Independent third party agreements mean that the
person/organisation responsible for managing your money does not work for
the council or the service providing your support. This means that they will be
focussing solely on your interests and there will be no conflict of interests.
The disadvantage of this approach is that independent third parties will
usually charge a fee to cover the administration time involved in this
arrangement. You will also need to be careful to ensure that they have a clear
way of recording your financial affairs which you can understand, and which is
supplied regularly.
4. INDIVIDUAL SERVICE FUND
An Individual Service Fund (ISF) is a money management agreement option
for personal budget holders who choose not to receive some or all of their
support through direct payments. An ISF is a three way agreement between
the Council, the resident and the service provider, which identifies the
respective roles and responsibilities in a contract. What happens is that the
councilpays money to a provider on an individual's behalf four-weekly in
advance into a designated client account whilst ensuring that the person
retains maximum control over any support provided within the context of the
support plan.
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An ISF is a sum of money that could be held by (e.g.) a home care
agency on your behalf and the money can only be used to buy your
support. This agreement should provide you with flexibility to work with the
provider to determine when and how you would like your support delivered.
A person could have more than one ISF with different providers if they buy
care or support from more than one agency. The service provider holding your
personal budget has to account for spending your money. They will keep an
individual account of the money and will work with you to ‘bank' hours that can
be rolled over into future weeks or months.
The advantages of this approach mean that your care provider has the
responsibility of accounting for your money but you retain flexibility of how
your money is used. The disadvantage is that not many service providers are
able to provide individualised accounts or agree more flexible and responsive
use of support hours. Service providers usually charge a fee for this service
because of the work involved in keeping individual accounts.
5. A TRUST FUND
The personal budget money could be transferred to a Trust Fund to be
managed on your behalf. A Trust is a commitment made by two or more
people (who are called Trustees) to support someone who finds it difficult to
arrange their own care or manage their own money. Often trustees are friends
and family members. Trustees have legal duties and responsibilities. They
will receive your Personal Budget money into the Trust Fund, and use it to
buy services and supports for you that meet your eligible Care needs. This
can often be complicated to set up but would mean that you could choose
people that you know and trust to manage the money on your behalf.
6. COMBINATION
You can choose to receive some of your social care support as a personal
budget direct payment, whilst the other part of your support could be
managed by the local authority. This option may be useful if you are not sure
how much you initially want to take on yourself.
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