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Personal Budgets:The right social care support

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Disability Rights UK Factsheet F72

Your feedback wanted

The Care Quality Commission (CQC) have recently launched their new ‘Tell Us About Your Care’ partnerships with a number of national charities, of which Disability Rights UK is one. This involves Disability Rights UK gathering feedback from disabled people about their experiences of using health and social care services. The CQC would welcome feedback on your experience of using any of the services they regulate. Please click here to do so.

Personal Budgets in the light of the Care Act 2014

The Care Act introduces new functions upon councils to focus on promoting wellbeing and prevention including offering personal budgets, establishing information services, and arranging independent advocacy services.

The Care Act applies to the whole of England only. There are separate Laws about social care in Wales, Scotland and Northern Ireland:

  • In Wales, the Social Services and Wellbeing Act (Wales) became law on1May 2014, and the areas covered by the Act including assessment of needs, financial assessments, adult safeguarding and complaints will start to take effect from April 2016 - legislation.gov.uk/anaw/2014
  • In Northern Ireland, changes have also been made to the social care system - transformingyourcare.hscni.net/
  • In Scotland, the Public Bodies (Joint working) Act about the integration of health and social care was granted royal assent on1 April 2014 and the NHS and councils are beginning to work towards this - gov.scot/Topics/Health/Policy/Adult-Health-SocialCare-Integration

Your entitlement to personal budgets

With the implementation of the Care Act, there is now a duty upon councils to produce a care and support plan and offer a personal budget following an assessment to ensure that disabled people and carers’ needs are adequately met. For the first time in law, local authorities have a legal obligation to offer personal budgets and conduct a care and support planning that were previously stated only in guidance as part of the Personalization agenda.  This is an important change in the personalizing care and support process as it enables people to have maximum and full control over how their needs are met.

What to expect from social services

With the recognition of personal budgets in the law, every individual is legally entitled to a personal budget that must be now incorporated in every care and support plan (or support plan for carers), unless the individual is merely getting intermediate care or reablement support to meet their identified needs. Local authority must provide personal budgets to whoever meets the regulations in the Act.

As part of the personalising care and support planning process, the local authority will inform you about your personal budget which you can receive in the form of a direct payment so that you can take full control over your own care. You have freedom over how the budget is spent. Under the Care Act, the local authority gives people the right to advocacy support (see Factsheet F39 - advocacy: get your voice heard) if they require help to have their say about their care needs, and a right to have their care reviewed when they feel this is necessary, or to challenge decisions about their care. It also requires councils to support people with social care needs if they move to a new area.

If you are self-funder or if you will be funding your own care and support, you can still discuss your support needs with your local authority. The council can assist you identify areas where you might need help and may be able to arrange you care for you.

What is a Personal Budget?

A Personal Budget is an agreed amount of money that is allocated to you personally by your local council (and other funding streams) following an assessment of your care and support needs. This is support that you decide and control, in other words you control the money for your care and support - Personal Budget. A personal budget is a statement of the amount of money needed to meet your eligible social care needs. It allows you (or your representative) to control the financial resources for your support and the way the support is provided to you. In Scotland, it is referred to as Self-Directed Support and offers the individual the freedom and right to self-direct your support.

A Personal budget is the route to achieving independent living based on the social model of disability. It assists disabled people to live an active life and participate in society. It enables you to achieve your outcomes stated in your personalising care and support planning.

Getting a Personal Budget

In order to get a Personal Budget, your council needs to work out your entitlement for public funded care and support – (Please refer to Factsheet F48 - assessment, eligibility and support planning).

If you appear to need care and support, regardless of your finances, your local authority (social worker or an appropriately trained assessor) will have a duty to carry out a needs assessment to get a full picture of your needs and outcomes in order to determine your eligibility against a national minimum threshold for eligibility. You may prefer to have a self-assessment if you wish to take the lead in identifying your needs and goals. Once it is decided that you have eligible needs, the council will then inform you about your personal budget as part of the process of your care and support plan that always involves you at the centre of decision-making.

How a personal budget can change your life

Personal budget promotes flexibility, choice, control and quality of life. It aims to give disabled people/carers (who use social care services and health services) the ability to take charge of the support they require in order to live independently and be in control of the care they choose that best meets their needs. Via the personal budget, you are empowered to live the life you choose by seeing how much money is available to buy the care you need.
Personal Budgets: the council’s duty:

Your local authority must:

  • inform you how they calculated your personal budget
  • ensure that the budget is sufficient to meet your needs
  • consider the local cost for the type of services you require, and that care may cost more if your needs are complex
  • notify you of what your budget is in good time, so that you can start planning your support once you know how much money is available.

Receiving and using personal budgets

Personal Budgets - Personalising care

Once you have been assessed as being eligible for council funding to meet your care and support needs (regardless of the contribution you may be asked to pay), the council is legally obliged to offer and allocate personal budgets for you to enable you to meet the agreed outcomes of your support plan. As part of the care and support planning process, it is now mandatory upon the local authority according to the Care Act 2014 (that came into force in 2015) to inform you of your personal budgets, that is the amount of money that the council has worked out it will cost to arrange the necessary care and support for you.

You may decide to take all or some of your personal budget in the form of direct payments. Personal budgets give you the choice to choose what support you wish to have. It is the total amount you receive for your care and support. You will be given an annual personal budget allocation following the assessment. You spend your direct payments budget to meet your agreed outcomes stated in your care planning. You cannot spend your direct payments to pay for day-to-day living costs such as utility bills and food or for items such as cigarettes.

The personal budget is designed to give you choice, control and independence to enable you to lead the life you want to lead and do things the way you would like. Personal budgets allow you to have full control over how your care and support will be best met. Personal budgets grant you the flexibility in choosing the service providers and how you want them to assist you.

Different ways to receive a personal budget

People’s needs do vary and your person-centred assessment will reflect the areas you need support with. You need to think carefully as to how you want your care and support arranged in order to achieve your outcomes. The local authority has a duty to provide relevant information and advice relating to care and support. Since you decide how you want to be supported and what works best for you to suit your care and support needs, you can receive your personal budget in a number of ways as stated below:

  • You opt for direct payments – your local council pays some or all of your entire personal budget funding into your bank account or a separate bank account held by a person (e.g. third agent, support broker) nominated by you. You utilize direct payments to buy your own support.
  • An account managed by the council (as indirect payments) – the council will manage your budget and will commission services on your behalf.
  • As an Individual Service Fund (ISF) – the local authority pays an organization that provides support services and will follow your instructions in getting the services you need. The organization will be answerable to you. You will have a say about how and services are provided to you.

You may wish to receive your personal budget by using a mixture of the above ways.

Using Personal Budgets - Purchasing care and support services from service providers

You can buy from providers various types of support services with your personal budget funding to meet your care and support needs outlined in your support plan. You can utilize your budget as below:

  • To recruit staff as personal assistants (PA’s) or buy care and support services from care agencies to help you to meet your eligible and assessed needs in your own home for instance with your personal care, social need, pursuing indoor/outdoor activities or be part of the local community
  • Short stays in a care home or respite care (applicable for carers who are given a break from their caring role)
  • Accessing a wide range of local community social and education activities and mainstream services such as being involved in sports, horse riding, day trips, going to clubs and leisure or learning centres and education sessions
  • To purchase particular aids and equipment (not provided by NHS) that you require and are stated in your support plan as an outcome that needs to be met to promote your independence. You cannot use direct payments to buy equipment already provided by NHS
  • To pay towards transport costs to undertake a variety of outdoor activities (or attending day centres) identified in your care and support plan
  • Attending day services and going to day centres – you can arrange for a short trial to visit different day centres to find out about their services and whether you would like to still attend these centres

Managing your support

Your local authority worker should provide you with relevant information about the options you can choose from to manage your money. Each local authority area has different systems in place to help you manage your budget and it is important that you find out what is available to you in your locality.

With a personal budget, you can arrange what support you wish to have in different ways or use a mixture of these different ways that are stated below.

Local Authority Managed Personal Budgets

Your local council can manage your Personal Budget on your behalf. They simply keep the money that has been allocated to you that have been agreed through your Support Plan.  Your support plan should demonstrate the cost of the support you will be receiving (see Factsheet F48 - assessment, eligibility and support planning).

Remember though you may have to put some of your own personal money towards the total amount of your Personal Budget if it is for social care. Social services will discuss with you any contributions you are financially assessed as having to pay towards your Personal Budget (see our factsheet on non-residential charges). If the local authority manages your personal budget you will receive an invoice for your contribution which you will have to make arrangements to pay.

If you choose this council-managed account, the local authority is responsible to arrange services for you; however, your support should still be personalised to meet your requirements.  Additionally, you can request from the local authority to manage part of your personal budget and ask to organise to manage the remainder of your budget in a different way.

Managing your own Personal Budget as direct payments

Managing your own personal budget is when you decide to take your budget as a direct payment. This is a cash payment that the local authority will arrange and make payments into a bank account opened by you, specifically to receive the personal budget. Most local high street banks will offer a basic current account for this purpose. It may be helpful to provide the bank with confirmation about your personal budget such as a remittance notice or letter from the local authority.

The account should have no other funds credited unless it is agreed for example your own contributions or other public funding. The cash payments that the local authority credit to your bank account could be weekly, four weekly, monthly or otherwise. Make sure you know when the local authority credits the payments to you, so you can pay for your services appropriately for instance paying your personal assistant’s wages.

Following a financial assessment, you may have to put your contribution towards the total amount of your Personal Budget if it is for social care.  If you choose to manage your own budget, the local authority may credit your specified bank account net.  If they make net payments you will need to pay your personal contribution into your own personal budget bank account before you pay for any services. This will ensure that you have sufficient money in the account to pay for your assessed requirements that have been agreed on the Support Plan. If the local authority credits you the gross amount into your personal budget bank account, they may periodically send you an invoice which you will have to arrange to pay.

Choosing to take your allocated personal budget means you will have greater choice and control, but you will have further responsibilities as well. You will have to provide the local authority with information about how you spend your personal budget, and you may be asked to report to them (sending return forms) every four weeks, quarterly, or annually depending on each council’s policy. Your local authority will provide you with information about what you need to send to them. On occasions you may consider having a joint signatory on the bank account; this is helpful when the person receiving the service has a fluctuating condition.

Nominated Person

You may not want the responsibility of managing the money yourself but wish to take on the responsibility of employing a Personal Assistant or contracting with a domiciliary care agency or using other forms of support. You may have a friend or family member or someone you trust that is willing and able (with support) to open a bank account of your behalf, this is called a “nominated person”. 

The nominated person would be in charge of make all the payments from the bank account for the services you opt to purchase – again these would be highlighted and agreed on your support plan.   Remember any contributions you may have been financially assessed as requiring to pay will need to be paid either into the bank account or the local authority may invoice you for any contribution you are liable for.  

Supported/Managed Accounts

In some local authority’s areas, you may have the option of being able to use the services of a supported or managed account.  It is important to recognise that each local authority area will have different options, there are some national organisations that provide supported or managed bank accounts.

A supported/managed account is when your allocated personal budget is paid to an organisation on your behalf. Sometimes this is referred to as a 3rd party payment. In many cases, Disabled People’s User Led Organisations (DPULOs) provide this type of service. The organisation will arrange to make all the payments for the services you are receiving. 

You may have chosen to employ a Personal Assistant or contract with a Domiciliary Care Agency, you will still have to take on the responsibility as an employer or contractor, and the organisation will simply process the payments. It is likely the organisation will charge you for using a supported/ managed bank account. The amount charged for a supported/managed account may be a set amount or it could vary dependent upon how many payments are made out of the supported/managed account.

The organisation providing this service will ask you to sign an agreement or contract for the service which should set out what the terms and conditions of using the service covers.  It would be useful to check out the below:

  • How you authorise payments – your managed/supported account service will still require you to authorise payments – this may be in the form of a signed invoice from you or a signed timesheet from you.
  • How payments are made to your employee(s) or contractors (for example through a bank transfer (BACs) or cheque.
  • When payments are made to your employee(s) or contracted service.
  • How you pay for any contributions you have been financially assessed as required to contribute towards your personal budget.
  • What records you need to keep for future reference.
  • What your responsibilities are for checking information on the account and payments made from the account.
  • How you terminate the services should you change how you wish your money to be managed.

Suitable Person

A “Suitable Person” can be appointed by the local authority to receive a direct payment and manage the money on your behalf. However, this is only when the individual who will be receiving the service lacks the capacity to make the decision to receive a direct payment.

Appointing the “Suitable Person” will mean they have to take on the responsibility of being either the employer or contractor or responsible for buying the appropriate services.  The “Suitable Person” will often be (but not always) given a lasting Power of Attorney or have been appointed by the Court of Protection as a Deputy under the Mental Capacity Act 2005. Usually the “Suitable Person” will be a family member or friend who may have previously been involved in the support of the person eligible for services.

Independent Living Trust

Where people lack capacity to receive a direct payment in their own right, an Independent Living Trust can be set up to manage the money, employ Personal Assistants (PA’s), contract with Domiciliary Care Agencies or buy relevant services. Some Independent Living Trusts have been set up for a small group of people and personal budgets are pooled and paid into the Trust’s bank account for better purchasing options – (See Factsheet F32 - pooling personal budgets).

The Independent Living Trust is made up of at least 3 Trustees who are responsible for the best interests of the beneficiaries of the Trust.  The same issues apply about any financially assessed contributions the individual(s) may have to contribute to the personal budgets and payments will need to be made into the Independent Living Trust’s bank account or the local authority will invoice individual’s separately for contributions.

User Controlled Trust

A User-controlled Trust is a legal arrangement similar to an Independent Living Trust but one where the recipient of the services is also a Trustee. The User’s choice and preference direct the decision making and, where the user has the capacity to consent to a direct payment – the user retains control of and is accountable for the arrangements.

Individual Service Funds (ISF)

Individual Service Finds are still not available in all local authority’s areas and you will need to find out from your local authority worker whether you are able to have this option. An Individual Service Fund (often referred to as an ISF) offers the individual the choice and control as well as avoiding the need for people managing the financial aspect of their care services.

The Individual Service Fund is where a provider “manages” a person’s personal budget in addition to providing the direct support. A contract or agreement is often arranged between the Provider and the Commissioning local authority, however, the contract or agreement may also be a “three way” contract involving the person who is going to be receiving the services.  The provider is responsible for ensuring the personal budget is spent on the individual’s personal requirements and reflects the support plan. 

It may be that the provider holding the funds also makes payments to other providers by contracting separately with them for a service on behalf of the person receiving the service.  An example of this would be where a provider pays for a gym membership or group activity from the Individual Service Fund on behalf of the individual receiving the services. The Individual Service Fund holder however is responsible to the Commissioning local authority and needs to ensure an open and transparent accounting system.

Prepayment Cards/Pre-Paid Cards

The Prepayment Card has been introduced by some local authorities to pay personal budgets to people who have been assessed as eligible for direct payments. So if you choose to receive direct payments, your local authority could give you a prepayment card to pay for services that meet your assessed needs stated in your support plan.

Other local authorities may have not yet introduced the option of Prepayment Cards for direct payments recipients, so you will have to check with your local authority social worker whether the Prepaid Card is available in your local area. The local authorities have introduced this Prepaid Card to enable them to monitor what you have spent on a web-based system, so you would not need to give receipts or provide quarterly return forms.
If you become a direct payments recipient, you may choose to use a Prepayment Card if you wish. If your local authority has the Prepayment Card scheme, you should still have the choice and control to open your own bank accounts should you wish to.

A Prepayment Card looks like a credit or debit card and works in a similar way, not all local authorities offer a prepayment card and you will need to check with your local authority worker whether this service is available in your area. The Prepayment Cards look similar to a bank card, however you cannot go “overdrawn” on a Prepayment Card and therefore you cannot get into debt with one. Payments are made in the same way as other bank cards. You can use the prepayment card to pay for community care services. You can for instance utilize it to pay your PA by BACS transfers to the PA’s bank account. You can do this online or via direct debits or make payments over the phone.

The card only allows you to use the amount of money that is paid into the card account via the local authority. A Prepayment card allows you to pay for services, the cards are provided by a bank and it’s important to remember you don’t need to open a bank account to be able to use a prepayment card. So if you have experienced difficulties in opening bank accounts in the past or don’t particularly want the worry about having a separate bank account, this may be a solution for you.

Your local council will “load” the card with the money that they have allocated to your care package.  If you have been financially assessed as having to pay a contribution (charges) towards your social care, your contribution will also need to be “loaded” on to the card, unless you have agreed otherwise. In other words, the amount that the council pays to you will be the amount less your contribution and you will need to top up the rest. You may not need to make any contributions to your social care if the financial assessment demonstrates you do not need to do so. You can “top” up the card if you need to make any financially assessed contributions or want to spend additional money on associated services.

The local authority will still need to check that the personal budget allocated to you is being used to meet your support needs and regular statements will be automatically sent to your local authority to view them on the computer systems. There may be an additional charge for you to access a prepayment card and you should check with your local authority what charges are in place. However, remember it is still not allowed to purchase services directly from your local authority, a prepayment card service is normally provided through a bank.  If you choose a prepayment card you do not have to open a separate bank account.  Statements will show payments in and payments out and will usually go direct to the local authority, although you could also request a copy of statements for your own purposes.  Any invoices or receipts you receive should be kept in accordance with any monitoring arrangements your Local Authority has in place.

If you use internet banking you would be able to transfer funds from your own personal account to the prepayment card account. However, if you don’t use internet banking you could set up a direct debit or standing order to transfer any charges you have been asked to contribute. Alternatively you may need to go into a bank where the prepayment card has been issued and make a payment into the account at the counter.
If someone else supports you with your social care arrangements a second card can be requested, generally this will have their name on the account and a different pin number.  On no account should you share your pin number with another person.

You will generally only be able to use your Prepayment Card at outlets that display that the card is acceptable. So if you are considering a Prepayment Card, check that you can use the card to make a payment for the services you want to use.

Further reading about Prepayment Cards can be downloaded at http://www.mastercard.com/uk/business/en/prepaid/commercial/downloads/guide/A-Guide-to-the-Use-of-Prepaid-Cards-in-Local-Government-Supported-by-MasterCard.pdf

And at http://www.demos.co.uk/files/Power_of_prepaid_-_web.pdf

As an example, Merton Council has a full information leaflet about their Pre-paid card that is available people who use social care in the borough. www.merton.gov.uk/health-social-care/adult-social-care/directpayments/direct_payments_finance_and_pre-paid_cards.pdf

Where can I get more help or information?

This factsheet is a basic overview of Personal Budgets under the Care Act 2014. You can find out more detailed information about social care and independent living in our Disability Rights Handbook. This and all our other publications are available from our shop
at https://www.disabilityrightsuk.org/shop

You can also place orders by contacting Disability Rights UK.

For further help and information please contact our Advice Line - 0330 995 0404.

You can get more information about where to get personal advice from our Factsheet F15 - Getting advice. All our factsheets are free to download on our website at disabilityrightsuk.org. We have a number of independent living factsheets.

April 2020

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