Direct Payments Explained: Taking Control of Your Own Care Budget

If your loved one has been assessed as eligible for funding towards their care from the local council, there is a choice many families do not realise they have. Rather than letting the council arrange everything on your behalf, you can take control of the budget yourself and arrange care that suits your loved one, through something called direct payments.

It is a way of putting choice and control back in your family's hands. Here is how direct payments work, their genuine benefits, the responsibilities that come with them, and how they relate to live-in care.

What are direct payments?

When someone is assessed as needing care and is eligible for council funding towards it, they usually have a choice about how that funding reaches them. The council can arrange care services directly, or the person can receive the money as direct payments, paid to them (or to a representative acting for them) to arrange their own care instead.

Direct payments are part of a wider move, underpinned by the Care Act 2014, to give people more choice and control over their own care. Where someone is unable to manage the payments themselves, a suitable person, often a family member, can receive and manage them on their behalf.

What can they be used for?

The essential principle is that direct payments must be used to meet the person's assessed care needs, but within that, there is real flexibility. They can be used to:

• employ your own carer or personal assistant directly
• buy care from a provider of your choice, such as a home care or live-in care agency
• arrange other services that meet the assessed needs

The point of it all is choice: rather than accepting whatever the council would have arranged, your family can shape the care around your loved one.

The benefits: choice and control

For many families, the appeal of direct payments comes down to a few real advantages:

• Choice. You decide who provides your loved one's care, and how.
• Flexibility. Care can be tailored around their needs, routines and preferences, rather than fitted into standard services.
• Continuity. You can choose, and keep, carers your loved one knows and trusts.
• Freedom to pick the right kind of care. If you would prefer a particular type of care, such as live-in care, that the council might not otherwise have arranged, direct payments give you the freedom to choose it.
• Independence and empowerment, for your loved one and your family.

The responsibilities: going in with your eyes open

It is only fair to be honest about the other side. Direct payments come with responsibilities, and it is important to understand them.

You will be responsible for managing the money and keeping records of how it is spent, as the council will want to see that it has gone towards the agreed care.

And there is a bigger consideration if you choose to employ a carer directly. In that case, you become an employer, with everything that involves: payroll, tax and National Insurance, insurance, employment contracts, arranging cover when your carer is unwell or on holiday, and various legal duties. That is a significant undertaking, and not one to take on lightly.

The good news is that support is available. Local councils usually offer direct payment support services, and you can use payroll and management services to take on much of the administration.

Direct payments and live-in care

Here is a point worth knowing, because it neatly sidesteps the biggest drawback. You can often use direct payments to buy care from a managed provider like Edyn, rather than employing a carer directly.

This gives you the best of both worlds: the choice and control of direct payments, without the burden of becoming an employer. We handle the employment, training, management and cover, while you direct where your funding goes. It means you get the care you want for your loved one, without taking on payroll and all the rest yourself.

One honest caveat: the amount of a direct payment is based on your loved one's assessed needs and the council's rates, and this may not cover the full cost of live-in care. Where there is a difference, a top-up is sometimes needed to make it up. This is worth discussing openly with the council and with us, so you have a clear picture. We are used to working alongside local authority funding, and can help you understand how it fits together.

How to get direct payments

The path to direct payments usually runs like this:

1. A care needs assessment by the council, which establishes what care your loved one needs.
2. A financial assessment, or means test, which works out how much the council will contribute and how much, if anything, your loved one contributes.
3. If your loved one is eligible for funding, you can ask to receive it as direct payments rather than council-arranged services.
4. A support plan and personal budget are agreed, setting out the needs and the funding.
5. The council sets up the direct payments, and support is available to help you manage them.

Our guide to local authority funding explains the assessment process in more detail.

Is it right for your family?

Direct payments are not the only option, and they are not for everyone. They suit families who want maximum choice and control over care, and who are either happy to take on some responsibility, or who use a managed provider to keep that responsibility to a minimum.

If you would rather the council simply arranged everything, that is a perfectly valid choice too. As with so much in care, it comes down to what suits your family and your loved one. Our guide to your funding options sets out the wider picture.

Care shaped around your loved one

Direct payments can be a wonderful way to shape care around your loved one rather than around standard services, particularly if there is a specific kind of care, like live-in care, that you feel would suit them best. And you do not have to navigate it alone.

If you would like to talk through how direct payments could work, and how we support families using them, we would be very glad to help.

Book a free care advice call, or give us a ring on 020 3970 9900.

This guide offers general information, not financial or legal advice. Direct payment rules, amounts and processes vary between local councils and change over time, so please check the specific details with your loved one's local authority, and consider free advice from Age UK or Citizens Advice.