Direct payments

Direct payments

Posted on March 5, 2013. Filed under: Adult's Services, Direct payments |


A Direct Payment is money paid by the local authority to an individual to pay for their own social care and support services. The payment is made instead of actual community care services being provided, and is roughly equal to the amount that would have been spent on community care services.

Direct Payments were introduced in 1997 to give people more independence and choice over their services. In practice, most people would use a Direct Payment to employ a Personal Assistant, instead of receiving traditional homecare services. They have been described as “the most successful public policy in the area of social care” (Cabinet Office Strategy Unit report on Improving the Life Chances of Disabled People, 2005), and for those able to take on the responsibility of managing their own money, the scheme was very successful. However, certain restrictions in the way Direct Payments can be used meant that uptake was limited.

From 2007-2011, Direct Payments evolved into the idea of Personal Budgets, which offer even more choice and control to the individual, with fewer restrictions. Personal Budgets can be received in a number of ways, one of which is a direct cash payment. In many local authorities a cash Personal Budget is still called a Direct Payment, and can be defined in essentially the same way.

Policies and legislation

  • Community Care (Direct Payments) Act 1996 – This gave Social Services Departments the power to make direct cash payments (known as ‘Direct Payments’) to eligible people to replace the Community Care services that those people had been assessed as needing. With the exception of residential care, people who receive these payments can use the money to buy services to meet their assessed needs. The Act confirms the principles of independence, choice and flexibility as the key elements of Direct Payments and guidance from the Department of Health emphasises the spirit of partnership between the local authority and the individual.
  • Carers and Disabled Children Act 2000 – Introduced in 2000 to include carers, disabled young people and parents of disabled children.
  • Health and Social Care Act 2001 – Consolidates the Carers and Disabled Children’s Act.
  • Department of Health policy and practice guidance – Contains the details on Direct Payments. It includes the views of carers and does not alter existing practice and standards in relation to assessment and care management. Direct Payments is part of the practice of needs-led assessment and sound care management.
  • Putting People First (2007) – The Department of Health document that outlines personalisation and introduces the idea of Personal Budgets for all social care service users.

Good practice examples

  • Leicestershire County Council’s Direct Payments DVD  – This DVD has been edited into a range of different versions for different service user groups, including: Physically disabled, learning disabled, hearing impaired and older people. Since the introduction of the DVD there has been a substantial increase of people taking up Direct Payments in Leicestershire.

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