Direct payments, personal budgets and individual budgets

    Direct payments are cash sums given in lieu of services

    What are direct payments?

    Direct payments are cash payments given to service users in lieu of community care services they have been assessed as needing, and are intended to give users greater choice in their care. The payment must be sufficient to enable the service user to purchase services to meet their eligible needs, and must be spent on services that meet eligible needs.

    [Read full coverage of our 2012 survey of social care professionals on personalisation, sponsored by Unison and The College of Social Work]

    Direct payments confer responsibilities on recipients to decide how their eligible needs are met, either by employing people, often known as personal assistants, or by commissioning services for themselves. Service users can get support in fulfilling these responsibilities from direct payment support services commissioned by local authorities, often from user-led organisations. Like community care services, direct payments are means-tested so their value is dependent on a person’s income and assets as well as their eligible needs.

    Direct payments are available across the UK and to all client groups, including carers, disabled children and people who lack mental capacity. However, they cannot be used to purchase residential care or services provided directly by local authorities.

    What are personal budgets?

    Personal budgets are an allocation of funding given to users after an assessment which should be sufficient to meet their assessed needs. Users can either take their personal budget as a direct payment, or – while still choosing how their care needs are met and by whom – leave councils with the responsibility to commission the services. Or they can take have some combination of the two.

    One version of a council-managed personal budget is an individual service fund, under which the budget is held by a care provider but the service user can choose how some or all of it is spent. ISFs have been used to apply personal budgets to residential care.

    As a result, they provide a potentially good option for people who do not want to take on the responsibilities of a direct payment. Personal budgets have been rolled out in England since 2008. In Scotland, where they are known as individual budgets, there are also plans to roll them out, under the country’s self-directed support strategy, which has been turned into legislation through the Social Care (Self-Directed Support) Act 2013. This requires councils to offer people eligible for social care support the option of a direct payment, an individual budget managed by the council, a service commissioned by the council or a mixture of any of the three.

    What is the role of social care professionals?

    Social workers and other care staff play a number of roles in the delivery of direct payments and personal budgets.

    • Decision-making – helping service users decide whether a direct payment or council-managed personal budget is right for them.
    • Assessment and resource allocation – assessing service users’ needs, or supporting them to assess their own needs, and allocating a budget to meet them, based on a resource allocation system.
    • Risk management and enablement – helping service users manage risks in their lives and regarding their care and support, and supporting them to take risks.
    • Challenging the size of a personal budget – social workers may feel that a person’s personal budget is insufficient to meet their needs, in which case they would take the case to a council funding panel.
    • Support planning and brokerage – drawing up a support plan in partnership with the service user and their family, and providing information on or sourcing services to implement the support plan (brokerage). While these functions are often carried out by council social care staff, some argue that they are better provided by external, specialist organisations, including user-led organisations. There is also support for users and their families to lead the support planning process, with social workers only providing assistance where requested; this has been taken forward in councils including York.
    • Review – keeping a service user’s support needs under review to ensure they are successfully meeting people’s needs.

    How many people are using personal budgets and direct payments?

    As of March 2012, 53% of ongoing users of community services in England were on personal budgets – some 432,000 people – were using personal budgets, according to the Association of Directors of Adult Social Services‘ annual survey of councils. This was an increase of 38% on the March 2011 figure.

    Take-up varies between councils but there was a big fall in 2011-12 in the number of authorities with low take-up rates. As of March 2012, 7% of councils had no more than a quarter of eligible service users on personal budgets, compared with 26% in March 2011.

    In Scotland, 5,049 people received a direct payment in 2011-12, up from 4,392 in 2010-11. However, this figure is small compared with the 63,458 people who were receiving home care at the same date.

    In Wales, as of 31 March 2012, there were 3,211 people receiving direct payments, up from 2,734 in March 2011. This represented 5% of the 64,912 people receiving community-based services at the same date. 

    Personal budgets for all by 2013 – or 2015

    In its 2010 adult social care strategy, the UK government set an ambitious target of having all council-funded service users and carers on personal budgets, preferably as a direct payment, by April 2013. This was interpreted by council leaders as applying to ongoing users of community-based services, not those in residential care or anyone receiving short-term or one-off support.

    The target has proved controversial with the Association of Directors of Adult Social Services warning that it has artifically driven councils to move people on to council-managed personal budgets without providing them with choice and control. Though the care and support White Paper, published in July 2012, confirmed the target – and the fact that it applied to users of ongoing, community-based support, it was dropped by the government in October 2012, when care services minister Norman Lamb reduced the target to 70% by April 2013

    The draft Care and Support Bill includes plans to make personal budgets a mandatory part of all care plans, meaning they would apply to all council-funded users – including those in residential care – from the bill’s point of implementation. This has been pencilled in as April 2015.

    Take-up across client groups

    Direct payments have traditionally had a higher take-up among younger adults – notably people with learning or physical disabilities – than older people, however with the advent of personal budgets in England that gap has closed in terms of access to self-directed support in general.

    However, older people have proved much more likely than younger disabled adults to take their budget in council-managed form, rather than as a direct payment.

    Figures for 2011-12 from the Health and Social Care Information showed that 85% of older personal budget users had an entirely council-managed budget, compared with 54% of younger disabled adults.

    Take-up of personal budgets has also traditionally been lower among people with mental health problems, and there are longstanding concerns that not enough has been done to make personal budgets work for older people, people with mental health problems and those with the most complex needs; these issues have been raised in a number of reports:-

    Older people and people with mental health problems

    There are ongoing efforts to boost take-up among people with mental health problems and older people:

    • A research project has been set up to explore good practice in the delivery of personalised care to people with mental health problems.
    • The Think Local Act Personal (TLAP) partnership, a sector coalition charged with supporting the implementation of personalisation in England, is focusing on how personal budgets can be better implemented for older people.

    TLAP produced the first report of its review into older people’s personal budgets in January 2013. This concluded that there were significant variations in council performance in supporting older people to access both direct payments and, more generally, personal budgets that offered genuine choice and control. It also outlined varirous barriers to supporting older people to access personal budgets, and how some councils had successfully overcome these. The next stage of the project will explore good practice in greater detail.

    Learning in relation to supporting personal budgets for people with dementia has also been provided by the two-year Dementia Choices project, run by the Mental Health Foundation, which ended in March 2011.

    Extending personal budgets

    There are also initiatives to test how personal budgets would benefit homeless clients and to people who misuse substances.

    In England, personal health budgets have been being tested to give people with mental health problems or long-term conditions control over resources spent on their healthcare. An evaluation report of the pilots in November 2012 found that personal health budgets were associated with significant improvements in quality of life and psychological well-being. Outcomes tended to be more positive where pilot sites gave patients more choice over how budgets were spent.

    On the back of the evaluation, the government announced plans to roll-out personal health budgets more widely; by 2014, all people receiving NHS continuing healthcare will have the right to ask for a personal health budget.

    The personal budgets concept is also being extended into other government funding streams used by disabled people through the Right to Control initiative, which is being tested in seven areas.

    This is designed to give disabled people control over resources for their social care, employment support, housing support and equipment and adaptations, to enable them to shape how the money is used.

    The July 2012 care and support White Paper announced plans to test the introduction of direct payments into residential care, where they are currently barred, while councils will be expected to have extended personal budgets more generally to people in residential care when the draft Care and Support Bill becomes law.

    How successful have direct payments and personal budgets been?

    A number of studies have shown significant benefits for service users from personal budgets and direct payments:

    The National Personal Budget Survey found that outcomes were better where service users were informed about the value of their personal budget, fully involved in the support planning process, alongside family carers, relatively free of constraints and bureaucracy, and where they had a direct payment rather than a council-managed personal budget.

    However, the number of people using direct payments appears to have stalled from 2010-12, according to the 2011 and 2012 surveys of progress on personal budgets by the Association of Directors of Adult Social Services. 

    There are concerns that councils are looking to maintain control over resources by managing personal budgets themselves, rather than giving service users a direct payment, and denying service users genuine choice and control at the same time.

    However, at the same time, there is recognition that managed personal budgets are the most appropriate options for many people who do not want the responsibilities of a direct payment, putting a premium on ensuring they deliver genuine choice and control.

    Bureaucracy and the implementation of personal budgets

    Despite the links between less bureaucracy and positive outcomes for service users, the implementation of personal budgets has been beset by excessive bureaucracy.

    Eighty two per cent of social care professionals said there was more bureaucracy in their role as a result of personalisation, found Community Care’s 2012 annual personalisation survey, up from 73% in the previous year’s survey.

    Explanations put foward include long and complex assessment forms and the need for personal budget support plans to be signed off by council panels, rather than social workers themselves.

    The situation has sparked repeated calls for the processes involved in personal budgets to be simplified, which is one of the priorities for action of sector coalition Think Local Act Personal. 

    Community Care special reports

    The state of personalisation 2012 

    The state of personalisation 2011  

    The state of personalisation 2010

    Good practice

    How social workers can cut personalisation’s red tape 

    How social workers can deliver person-centred reviews

    Why support planning doesn’t have to be social work-led 

    Culling excessive paperwork from personal budget assessments

    Latest stories

    Massive variations in older people’s experience of personal budgets 

    Lamb scraps 100% personal budgets target 

    Social workers need training in delivering personalisation amid cuts

    Direct payment numbers stall amid hike in personal budgets 

    Personal budgets for older people to be reviewed

    Supreme Court: Councils must justify personal budget totals 

    Proposed 70% care cut exposes resource allocation failings 

    Do direct payments make people safer or less safe?  

    Where now for personal budgets?

    Further reading

    Think Local Act Personal

    Social Care Institute for Excellence

    In Control

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