The use of prepayment cards by councils as a tool to manage personal social care budgets is constraining service users’ right to exercise choice and control, a study has claimed.
The research, carried out via Freedom of Information (FOI) requests by the Independent Living Strategy Group (ILSG), a network of disability organisations and their allies, found almost half of local authorities in England used the cards. Instead of making direct payments into service users’ bank accounts, councils load up the cards with funds, are able to monitor them – at an individual transaction level – and in many cases choose to restrict their use.
Across the 69 areas using them, 15% of all personal budgets – nearly 33,000 in total – were managed via prepayment cards, the study found, with three councils using them for all or nearly all of their personal budgets. Contravening statutory guidance, some councils were allocating cards as a default mechanism, rather than offering other options such as direct payments.
While nearly all councils using prepayment cards said they considered them direct payments, roughly a third prohibited service users from directly withdrawing cash, as they would be able to with a regular bank account. A similar proportion said they allowed cash withdrawals, while the remaining third permitted withdrawals in certain circumstances.
The vast majority of authorities placed some other kind of restriction on how funds were spent, though the research found considerable geographical variance, creating a postcode lottery.
“Most common was a stipulation that the funds must be used as described in the individual care and support plan and to meet assessed eligible needs,” the report said.
Councils frequently imposed blanket bans – including blocking cards at certain establishments – around things such as food, alcohol, and dating and escort services. They also flagged up their ability to monitor spend and suspend cards if they were unhappy with transactions.
Under the Care Act 2014, all people receiving long-term care and support are required to have control of their personal budget – including having agency over how funds are held and used to meet their desired outcomes.
The statutory guidance on the Care Act says prepaid cards “can be a good option for some people using direct payments, but must not be used to constrain choice or be only available for use with a restricted list of providers”.
It adds: “It is also important that where a pre-paid card system is used, the person is still free to exercise choice and control. For example, there should not be blanket restrictions on cash withdrawals from pre-paid cards which could limit choice and control.”
‘No going backwards’
John Waters, a researcher from the charity In Control, who wrote up the ILSG research, said that the study was a warning that there must be no “going backwards” around choice and control.
“As an emerging innovation payment cards present councils with tremendous opportunities – they could if used well help make the aspiration of greater choice and control embedded in the Care Act a reality for people in their day to day lives,” he said.
“The report shows that current use of the technology is focused on increasing monitoring and imposing controls on people’s lives, perverting a potentially empowering technology,” Waters added. “The cards are too often being forced on people in a ways that undermine their rights and dignity.”
‘Cumbersome and difficult’
The ILSG carried out its research after one of its members – Clare Gray, a disability advocacy advisor with Shaw Trust – raised concerns about her personal experience of prepayment cards and how her direct payment was being managed.
Gray told Community Care that her local authority had switched her to a prepayment card with little warning, after 20 years of problem-free direct payments into her bank account. She endured two years on the “cumbersome and difficult” system, including an unsuccessful appeal to the Local Government Ombudsman, before her payments were reinstated.
“The system wasn’t very accessible, I was always having to put in my password and couldn’t view payments easily and I have limited movement, so it’s hard for me to use a mouse and keyboard,” Gray said. She added that the prepayment card made paying her care staff much less convenient.
Council spending on cards
All 152 local authorities with social care responsibilities responded to the ILSG’s FOI requests, with 69 saying they used the cards and many others considering them.
The report estimated that the councils using the cards spent £1.5m on introducing them, and a similar amount per year on associated costs and fees.
“In contrast to the scrutiny on spending expected of disabled people, our research highlighted that many local authorities were not in a position to say how much the schemes had cost them to introduce or to run,” the report said. “It is therefore not clear that the additional cost of operating such systems can be justified.”
There was little evidence of growing public demand for the cards, or benefit to their end users, the report claimed. “Their attraction seems to lie in the ability they give to local authorities wishing to monitor spending,” the report said, adding that their introduction “potentially represents a gross invasion of privacy”.
It concluded that prepayment cards’ use needed to be “characterised by partnership and trust”, and said that misappropriation of funds was “exceptionally rare”.
‘Good test’ for councils
In a series of recommendations, the ILSG advised councils to offer payment cards only as one of a number of options, to avoid blanket restrictions on their use and, when considering individual restrictions, to evaluate whether they represent a deprivation of liberty. It also called for “open and transparent” policies around monitoring accounts, recommending that access be restricted to single named individuals.
Margaret Willcox, the president of the Association of Directors of Adult Social Services (ADASS), which the ILSG told Community Care had engaged positively around the report recommendations, said she was “grateful” that prepayment card practice had been investigated.
“Managing the balance between our duty to protect the people we serve and resources we manage alongside the maximising of choice and control is ever challenging, but the report recommendations provide a good test for us,” she said.
Clenton Farquharson, the chair of Think Local Act Personal, the leadership organisation for personalisation, said he welcomed the report’s highlighting of an issue that was “often” brought to his attention.
“We will be delighted to work with ILSG and ADASS and support the sector by developing practical advice and materials which councils and their partners can use to improve practice,” he said.
Waters said: “It is helpful that the recommendations in the report are being welcomed, as they provide a template for implementation that if adhered to will see payment cards implemented in positive ways.”