Independent Living Fund is past its prime, write Bob Hudson and Melanie Henwood

The Independent Living Fund (ILF) is the forerunner of “cash-for-care” programmes in the UK, but now has to co-exist with a wider range of similar programmes and initiatives. The authors were commissioned by the Department for Work and Pensions in 2006 to conduct an independent review of the ILF, which has just been published. In this article they summarise the case for radical change that is proposed in the report.

“Cash-for-care” may be the latest bit of social care jargon, but the concept behind it is nothing new. Direct payments and individual budgets were predated by the Independent Living Fund (ILF), which was established almost 20 years ago. We have completed a review of the ILF, on behalf of the Department for Work and Pensions (DWP), to consider how it fits with individual budgets.(1)

As with many developments in social care policy, the ILF grew incrementally. It was set up in 1988 as a result of the changes in the social security system that saw the introduction of income support. The former supplementary benefit system included domestic assistance allowances, which supported severely disabled people who chose to live at home rather than in residential accommodation. The new income support system did not have such allowances and so transitional arrangements were established to protect the 300 or so people who could lose out. More permanent arrangements for people needing such help in the future were created by the fund’s establishment.

Originally given a lifespan of five years, the fund soon attracted more claims than predicted and by 1993 was supporting 23,000 people. The government made a commitment to maintaining a fund to support this group of people and since 1993 two ILFs have operated (the Extension Fund for existing clients prior to 31 March 1993, and the 1993 Fund for new claims).

Today, the fund supports more than 18,000 people, at an annual cost of £264m. We recognise that for many of these people the ILF is highly valued. The review collected evidence from many service users and their families who praised the fund and highlighted its life-changing impact.

However, their comments did not offer an analysis of whether such qualities are intrinsic to the operation of the ILF. We therefore needed to analyse in detail the operational framework of the fund. That framework is very complex. But while this complexity needs to be looked at we should not lose sight of the principles and values that should underpin such a framework. We chose to evaluate the operational framework of the ILF against the following six criteria:

● Equity.
● Transparency.
● Accessibility.
● Self-determination.
● Flexibility.
● Values and outcomes.

Less than ideal

Analysed against these principles there is much in the operation of the ILF which is less than ideal. The fund is a little known scheme. One of the recurrent themes in our review was that the ILF was “below the radar”. Not only was it often described as “one of the best kept secrets”, but it became evident that the ILF is anomalous and – in many ways – anachronistic. Not only do many people not know about its existence, but its eligibility criteria mean that access is by no means straightforward.

People with very high support needs are precluded from applying to the ILF (as are those in the final stages of life) because of a spending cap in the first six months of support. Others with substantial needs also fail to get the level of support they need people aged over 66 cannot apply to the ILF, and many others (including former residents of long-stay hospitals) are either excluded from applying or limited in the support they receive.

The fact that the ILF operates in parallel to the processes operated by councils is also a source of problems. The ILF applies different rules around charging, uprating of payments, treatment of benefits and of occupational benefits and capital limits. For service users, the result is confusion and unwanted bureaucracy in having to cope with the conflicting demands of two systems.

The cash provided by the ILF comes with strings. This is probably the area that is most out of kilter with the development of new cash- for-care models. The approach pioneered by In Control and being promoted by the pilot individual budget schemes takes the concept of “self-directed support” to maximise freedom for people in how they use the resources available to them. By contrast, the ILF can be used only to pay for “personal care and domestic assistance”, which can constrain the more innovative and tailored support that people want in their lives.

Many of the changes needed to bring the ILF more into line with the current discourse on self-directed support are things that the fund has itself argued the case for. The ILF has limited autonomy and operates within the legal framework of a trust deed and associated conditions of grant agreement specified by the sponsoring department (DWP). The big question is whether changing that framework and bringing the fund up to date would be sufficient. We concluded that some of the more obvious shortcomings of the rules of the ILF can – and should – be tackled. However, we believe that in the long term more radical reform is required.

The ILF is a creature of its time. Indeed, it was ground-breaking in providing the first cash for care model. However, the new policy framework around individualisation of support (whether through individual budgets or any similar model) requires coherence and integration of all streams of funding.

It is anomalous to retain a separate non-departmental public body with responsibility for a large amount of social care expenditure operating in parallel to the mainstream world of independent living.

Bureaucracy overload

Not only does this needlessly duplicate bureaucracy and administrative systems, but the idea of funds being allocated through an non-departmental public body (part of which is a charity) sits uncomfortably with the ethos of the independent living movement in the 21st century. A preference for rights not charity, and for transparent decision-making through accountable and democratic processes, is not compatible with decisions made by a board of trustees behind closed doors.

As we noted at the outset, the ILF makes an enormous difference to people’s lives. It is essential that this is safeguarded and that people do not lose such valued support (or fear losing it). In the short term (through to 2009-10) we have recommended that the ILF should remain in its present form but should implement many of the improvements we have indicated. In the long term, there should be a smooth transition towards full integration of the ILF within a national system of personalised budgets.

The future model needs to be based upon localisation and integration, rather than centralisation and separation.

Melanie Henwood is an independent health and social care consultant.
Bob Hudson is visiting professor of partnership studies at the school of applied social sciences, University of Durham.

Training and learning
The author has provided questions about this article to guide discussion in teams. These can be viewed at and individuals’ learning from the discussion can be registered on a free, password-protected training log held on the site. This is a service from Community Care for all GSCC-registered professionals.

(1) M Henwood, B Hudson, Review of the Independent Living Funds, Department for Work and Pensions, 2007

This article appeared in the 15 March issue under the headline “How to loosen the strings?”

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