Personal budgets and direct payments

5 mins read

Local authorities might offer families the option of a personal or individual budget to pay for services and practical support. If they do, you may be able to request a direct payment.

In this article

What is a personal budget?

If the local authority decides that your family is eligible for help following a needs assessment, it’ll give you a personal budget to meet these needs. 

A personal budget is an amount of money to spend based on how much it will cost in your local area to arrange the care and support your child needs.

Note that where we refer to the local authority social services department, this also includes the Health and Social Care Services in Scotland and the Health and Social Services Trust in Northern Ireland.

How can I use the personal budget?

Personal budgets usually work in one of the following ways:

  • Your local authority manages an account. They will then organise and provide the support. 
  • A third party manages an account. This may be a local carer provider or local charity who will make the arrangements and manage the payments. 
  • You can request a direct payment (see below). You can then set up an account specifically to receive the payment.
  • Some combination of the above; for example you pay for some services while the local authority manages the rest.

What are direct payments?

If your local authority agrees that your child needs services or practical support, you can choose to receive the payments to buy and organise these services yourself. This money is then paid to you in the form of direct payments.

Direct Payments can be a good way to be creative and flexible when managing your child’s care. But they can involve more work for you to arrange and manage the care provided. If you’re employing someone directly, you will need to deal with tax, National Insurance and pension issues for them. You should also arrange insurance and a criminal record check. 

How can I use a direct payment?

Some of the ways direct payments can be used are:

  • Getting help with your child’s personal care, for example bathing, dressing or eating, or help looking after them overnight.
  • A sitter service to look after your child when you are out.
  • Help for your child to access or use leisure facilities.
  • Help with household tasks to free up your time to look after your child.
  • A place at a day nursery or after-school care.
  • Someone to accompany your child on holiday.

Some reasons for using direct payments

Direct payments should give you more control over how your child’s needs are met. There are several reasons you might choose to receive direct payments instead of having services organised by the local authority:

  • The services you currently receive don’t meet the needs of your family, or if your feel you have little say over how these services are provided.
  • You live in a remote and rural area where no suitable services exist – employing a personal assistant (PA) may be the only realistic method of support. Note that employing a PA means you will have the responsibilities of an employer. Most local authorities will have services to support families who choose to use their payment in this way.
  • Your child has cultural or language needs that your current service providers cannot meet.
  • Your child has been assessed as needing services but you have been waiting a long time for help to become available.

It is important to be aware that local councils can refuse to give personal budgets or direct payments if they are considered an inefficient or impractical use of resources.

Additional information for England only

In England, your personal budget may come from your local social services team, local education department or in some cases from your NHS clinical commissioning group (CCG).

The personal budget for education is included in an Education, Health and Care (EHC) plan and will only include the funds needed to buy more specialist or individual support than the school or college is expected to provide.

Social services are required to offer personal budgets to disabled people aged 18 or over who they assess as needing social care. Although they are not obliged to offer a personal budget to a disabled child under the age of 18, an increasing number of councils do offer them.

Anyone receiving NHS continuing healthcare, including a child, has the right to have a personal health budget. This sets out the funding available to meet the healthcare needs that have been agreed by health professionals in a care and support plan.

A care and support plan helps people to identify their health and wellbeing goals, and then sets out how the funding in their personal budget will be spent to achieve these goals.

Integrating education, social care and health budgets

Social service departments, education authorities and CCGs are being encouraged to work together. The aim is to establish arrangements allowing for single personal budgets that cover someone’s social care, education and healthcare needs. How this personal budget is used is then set out in an EHC plan.

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