On this page you will find information about what Direct Payments are, how to get them and what they can be used for. Some of the information below has been collated from information provided by the Department of Health and  Counsel and Care publications.

Please note: It is important to recognise that the Direct Payments policy and practice may vary from one local authority to another.

The Rowan Organisation offers a range of services to support and assist Direct Payments users and you can find out more about these by viewing Our Services page.

Information on Direct Payments

1. What are Direct Payments?
2. What is the difference between Direct Payments and an Individual (Personal) Budget?
3. Why would I want Direct Payments?
4. Who is eligible to receive Direct Payments?
5. What is Fair Access to Care Services?
6. Do I have to be able to consent to receive Direct Payments?
7. How do I get Direct Payments?
8. Can I refuse Direct Payments if they are offered?
9. Will I have to manage Direct Payments by myself?
10. What can I spend my Direct Payments on?
11. Direct Payments and residential care
12. Can I use Direct Payments to employ my relatives?
13. Will I get enough money to meet my needs?
14. Will I have to make a financial contribution?
15. How will I get the money?
16. Where can I get help with my Direct Payments?
17. What do I need to know before getting Direct Payments?
18. What if I don't need to spend all of the money?
19. Will I need to keep records?
20. What happens if I get into difficulties with my Direct Payments?
21. What happens in emergencies?
22. What if I am not happy with the service?
23. If I get Direct Payments, will they affect my benefits?
24. What do I need to know about employing my own staff?
25. How do I find someone to employ?
26. How do I go about interviewing?
27. How do I decide how much to pay people?
28. How can I check potential employees are suitable?
29. How do I go about paying my employees?
30. Will I need insurance?
31. Will I need a contract of employment?
32. Can I use someone who is self employed?
33. Can I use an agency?

What are Direct Payments?

Direct payments are cash payments made to individuals who have been assessed as needing services, in lieu of social service provisions.

Most people who already receive social services from their council have a right to Direct Payments. You can use the money to arrange services for yourself in order to meet your social care needs. Your social worker should discuss Direct Payments as an option with you when your needs are assessed. Direct Payments are not liable to income tax and are not taken into account when assessing social security benefits.

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What is the difference between Direct Payments and an Individual (Personal) Budget?

Individual Budgets are similar to direct payments in that they have the same principles of service user choice and control. However, an Individual Budget, unlike Direct Payments, does not have to be only in the form of a cash payment and the funding that comprises an individual budget can come from a number of sources. However, most people who receive an Individual or Personal Budget are likely to receive this in the form of Direct Payments.

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Why would I want Direct Payments?

Some people find that services provided by the council aren't flexible enough to meet their needs, or that they lack continuity. You may find, for example, that they can't always be provided at times that suit you. With Direct Payments, you decide how and when your support is delivered and by whom.

Direct Payments offer flexibility and choice to individuals by allowing them to make their own choices about their lives. People of all ages can purchase care for themselves that better suits their individual needs.

You can use Direct Payments to employ people who report straight to you. Or you can use the money to contract an agency where the agency will be accountable to you and not the local council. You can also use a mixture of these two solutions.

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Who is eligible to receive Direct Payments?

Under the current legislation, in order to be eligible to receive Direct Payments you must firstly be willing to receive the payments,* and meet one of the following criteria:

• You are an older or disabled person requiring care; or
• You have parental responsibility for a child; or
• You are a carer aged 16 and over, and you will be using the payments to meet your own assessed needs as a carer; and
• You are not subject to certain mental health* or criminal justice legislation that prevents you from receiving Direct Payments.

*From October 2009, with the introduction of new regulations, if a person lacks capacity but has another suitable person willing to receive them on their behalf, they can be eligible to receive direct payments. In addition, people subject to certain mental health legislation, such as guardianship, will also be able to receive Direct Payments.

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What is Fair Access to Care Services?

Your eligibility for Direct Payments may be affected by your local council's criteria. ‘Fair Access to Care Services' is Department of Health guidance that provides a framework for all local councils on how to set their eligibility criteria fairly. Each local council has its own eligibility criteria based on this national guidance, which they will use to decide who should receive care services and Direct Payments. They can decide which categories of need they will meet according to their resources. These categories are based on the level of risk to the person needing care. There are four levels of risk: critical, substantial, moderate and low. Local councils are restricting the number of people they provide services to, and you may find that they are only providing services in your local area to those people who have critical or substantial care needs.

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Do I have to be able to consent to receive Direct Payments?

Under the current legislation, councils will only agree to make Direct Payments to you if you are able to give your consent. However, from October 2009 with the introduction of new regulations, councils must agree to make Direct Payments to a person who lacks the capacity to consent, if it is considered that they can benefit and there is a suitable person able to consent and manage the direct payments on their behalf.

Until the new regulations are in place, councils must work within the framework of the Mental Capacity Act 2005, when making the decision whether someone lacks the capacity to consent or to manage payments. This requires professionals to assume that an individual has capacity unless it is established that they lack it.

Under the Act, people must be empowered to make as many decisions as possible for themselves.

Your local council will make its own decision about your ability to consent, but should only do so with the support of an assessment by staff who have been specially trained to assess mental capacity and to help people to make decisions, such as a community psychiatric nurse.

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How do I get Direct Payments?

Firstly, you will need to contact your local Social Services to request an assessment of your needs. If your local council has implemented the Self Directed Support approach, involving Individual Budgets, you may initially be asked to complete a Self Assessment Questionnaire. Otherwise, you will receive a Community Care Assessment carried out by a Social Worker. At the assessment, your Social Worker should discuss the option of Direct Payments.

Before the assessment, it might help to think about your support needs. Some people find it useful to keep a diary for about a week beforehand; recording what they do, how long it takes and what help they receive, as well as what they would like to do if they had the appropriate support. If you decide to do this, it's important to remember those things that don't happen every week. At the assessment you will likely be asked questions about your ability to manage daily tasks, including personal care, household tasks and social activities. Questions might include:

• What tasks can you do yourself and what do you need help with?
• What things do you need other people to do for you?
• What would you be able to do or like to do if you had the right support?

If you have already had an assessment and receive services, you can contact your local council to discuss the option of Direct Payments. If you have been assessed and the council decided that you didn't need services, it won't offer you Direct Payments. However, you can appeal to the council if you disagree with this.

If you haven't already been assessed but think you might be eligible for Direct Payments, or if your needs have changed since a previous assessment, you can contact your local council to request one.

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Can I refuse Direct Payments if they are offered?

Yes. One of the main values of independent living is that choice and control remains with the individual. This means that everyone has the opportunity to choose to use Direct Payments, if offered them, and also to refuse them.

There are pros and cons to Direct Payments. They do offer greater flexibility and empowerment, but they also bring responsibilities. If you have Direct Payments, you are responsible for arranging the services you need, managing any problems that arise and you also have to account for the way you use the money. If you use Direct Payments to employ your own staff, you also have legal responsibilities associated with being an employer.

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Will I have to manage Direct Payments by myself?

No, not necessarily. There are many avenues of support for people who have Direct Payments. You can use family and friends to help you manage your money and even act as your representative if you need support being an employer. The Rowan Organisation also offers a number of services that can assist you with all aspects of Direct Payments. Please see Our Services page for more information.

It is important to remember that if you accept Direct Payments, you can change your mind at any time.

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What can I spend my Direct Payments on?

The Direct Payments money is for you to arrange the services or equipment that you have been assessed as needing. Your social worker will explain what the money can and cannot be spent on. You will need to discuss with them how you will use the Direct Payments to meet your support needs. You can have a combination of Direct Payments and council services to meet your needs if you prefer.

Direct Payments cannot however, be used to purchase services from your council.

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Direct Payments and residential care

Direct Payments are intended to support you with independent living, so they cannot be used to pay for permanent residential care. However, they can be used to pay for short periods of respite in residential care, if your council agrees that this is needed.

For people who already live in residential care, Direct Payments can be offered on a temporary basis, for example to try out independent living arrangements before deciding whether or not to move out of residential care.

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Can I use Direct Payments to employ my relatives?

Direct Payments cannot be used to employ your spouse or partner, or a relative who lives with you in the same household, except in very exceptional circumstances. Your local council will have to agree to making this exception. You can, however, employ a relative who does not live with you.

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Will I get enough money to meet my needs?

Your council have to provide you with enough money to meet your assessed needs. If you don't think you've been given enough, you should contact your council to appeal. However, the council also has a responsibility to secure the best value service. This might mean that they won't cover the full cost of a particular service if there is an equivalent service available at a lower cost. For example, it might not cover the cost of an agency you choose if there is another agency that charges less for an adequate service.

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Will I have to make a financial contribution?

If you are an adult, you may be required to make a contribution towards the cost of your Direct Payments, just as you can be charged for other council services. You should not be charged more than you can afford to pay and you will not be charged against your earned income. Whether or not you are required to make a contribution will be determined through a financial assessment which is carried out by your loca council.

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How will I get the money?

Normally, you will need to open a separate bank account with a cheque book facility for your Direct Payments. Your local council will then transfer the money into this account. It is up to the local council how and when this is paid and also how any contribution made by you should be paid. Your social worker can advise you about this.

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Where can I get help with my Direct Payments?

The Rowan Organisation provides support services to Direct Payments users in those counties where we are contracted by the local authority to work. We can assist with all aspects of Direct Payments. For information about what services The Rowan Organisation can offer to individuals, please see Our Services available on this website.

You can also have support from family and friends, independent living trusts, circles of support, self-advocacy groups and the local Peer Support Group if there is one in your area.

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What do I need to know before getting Direct Payments?

Before Direct Payments start, you should consider discussing the following points with your social worker and/or your local Direct Payments support organisation:

• What needs and services do the Direct Payments relate to?
• How much will you receive and do you have to contribute?
• How will you secure the services to meet your needs?
• What support will you need and where is it available?
• What the money can and cannot be spent on and how much flexibility is allowed
• What changes to the way you spend the money need to be agreed in advance
• How and when the Direct Payments will be paid
• What the back-up arrangements are for emergencies
• What steps should be taken to safeguard the welfare of children
• What information will you need to give about how you are spending the money?
• Are there any conditions attached to the Direct Payments?
• When your arrangements will be reviewed
• The circumstances in which the council would consider stopping your direct payments
• The notice period you would be given if Direct Payments were to be stopped and how any outstanding commitments would be handled
• In what circumstances would the council seek repayment?

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What if I don't need to spend all of the money?

If you don't need assistance for a while, or if you need less than usual, contact your council as they may need to adjust the amount of your Direct Payment. If you find that money is building up in your Direct Payments account, you may need your account reviewing to ensure you're spending the money correctly and getting all the support you need. Local advisers from The Rowan Organisation can assist you if required, to help you look at your Direct Payments account and to identify any issues.

Whatever you do, you mustn't spend the money on anything that hasn't been agreed with social services in the Care Plan. You could be asked to repay money that has been spent on something other than your assessed needs, or if money has built up in your account over time and not used.

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Will I need to keep records?

Your local council will need to check that you are spending your Direct Payments on services to meet your social care needs. You will be told what records you need to keep to allow them to do this.

Usually, you'll need to have a separate bank account for your Direct Payments to go into and you'll need to keep the bank statements for this account. You may also need to keep timesheets for your personal assistants, receipts or invoices and copies of wage slips. The Rowan Organisations' local teams can provide information and support to assist you with your record keeping and auditing.

The council will tell you how and when they intend to check on the way you are spending your Direct Payments.

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What happens if I get into difficulties with my Direct Payments?

An adviser from the Rowan Organisation can look at how you are spending the money to identify problems and help you sort things out. You can also contact your local council if you believe that the money is not enough to meet your needs.

If you don't spend all of the money, or if you spend it on something that you have not been assessed as needing, you may have to repay it. The council could also stop your Direct Payments if it doesn't think you are able to manage them. However, you can have support to manage your Direct Payments if needed.

If you want to, you can stop your Direct Payments and have council services instead.

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What happens in emergencies?

Sometimes the arrangements you make can break down, no matter how much you prepare. For example your personal assistant could be taken ill. You will need to make back-up plans to provide for such an emergency. This could be an existing employee who can be called in to work at short notice or emergency support provided through an agency. For this reason, the adviser from the Rowan Organisation will discuss such contingency plans when Direct Payments are first set up. If your back-up arrangements break down, your local council has a duty of care to make sure you're not left without support. Contact your local council as soon as you realise that you need help.

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What if I am not happy with the service?

If you're unhappy with a decision by your local council or a failing on their part, they will have a complaints procedure that you can follow. They will be able to tell you how to make a complaint.

If you are unhappy with the services provided by an agency or an individual from an agency, you should complain to the agency concerned.

You can be assured that The Rowan Organisation takes all complaints seriously. If you are unhappy with a service from us, you can contact us for details of how to make a complaint.

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If I get Direct Payments, will they affect my benefits?

No. Direct Payments money is provided for a specific purpose; to provide social care support services. It is not an income and will not be taken into account when calculating social security benefits.

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What do I need to know about employing my own staff?

There are certain legal responsibilities that you take on when you employ staff. The Rowan Organisation can advise you of what these are and how you can comply with them. We have local advisers who will make sure that you are meeting your responsibilities.

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How do I find someone to employ?

An Independent Living Adviser from the Rowan Organisation can support you with identifying people to employ. They will talk with you about your needs and about what was agreed in your assessment, in order to identify the personal qualities you want your assistant to have and the jobs you need them to do. This will be used to assist you in creating a job description and person specification.

It may be possible to find someone by word of mouth, or there may be a friend, neighbour or relative that can work for you. You can also have support to advertise in newspapers or local jobcentres. If you decide to advertise in a newspaper or through Jobcentre Plus, you can use the Rowan Organisation's free Recruitment Line. Please see Our Services page for more information. Once you have started to receive applications, our local adviser can support you with interviewing and even with arranging somewhere to hold the interviews.

In addition to the above, the Rowan Organisation often receives enquiries from people about possible personal assistant vacancies. It may be that they had already applied for previous vacancies advertised by service users, but were unsuccessful at that time or maybe are willing to do relief work for another employer.

In order to help support the recruitment process and potentially improve our service users' chances of finding suitable PAs, the Rowan Organisation has created a database (the PA Register) to hold details of PAs who are looking for a job or for additional hours. PAs who join the PA Register, after signing a consent form, will be able to receive details and an application form for new vacancies in their area.

PA details will be held on the PA Register for up to three months, unless they instruct the Rowan Organisation to keep it on for a shorter or longer period.

Please note that the Rowan Organisation does not recommend individuals for jobs and it is made clear to all PAs that we are not the employer.

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How do I go about interviewing?

When you start to receive applications, go through them to see how they compare with the skills and qualities that you are looking for. A local Independent Living Adviser from the Rowan Organisation can help you with interview techniques and with somewhere to hold the interviews.

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How do I decide how much to pay people?

This will depend on how much you receive from your council. Your Direct Payments should cover the cost of arranging the services you need and leave you with enough to keep some money back in case of emergencies and to cover other expenses such as employers liability insurance and National Insurance (Employers contribution). The Rowan Organisations' local advisor can help you work out how much to pay your employees and ensure that you keep enough money to cover the additional items.

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How can I check potential employees are suitable?

When you employ someone, it is important to check their suitability, especially if they are going to work with children. There are two important things you can do to check the suitability of your candidates; ask for references and have a Criminal Records check conducted.

References

We recommend that you check references before you offer someone the job, or tell them that the job is subject to satisfactory references. This will give you the opportunity to follow up on any previous work experience they give and will give you more of an idea about what they will be like as an employee.

Criminal Records Bureau (CRB) checks

A CRB check looks at all criminal convictions, even those regarded as 'spent'. It also checks to make sure they are not banned from working with anyone. Most local authorities provide a CRB check for Direct Payments users who are employing someone to work with children or vulnerable adults. However, the Rowan Organisation can do this for people who can't have a check done by their local authority.

You can contact your local authority for details on how to apply for a check or discuss with your local Rowan advisor. For details regarding CRB checks carried out via the Rowan Organisation, please see Our Services. 

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How do I go about paying my employees?

When you employ people, you need to:

• Register as an employer with HM Revenue and Customs (HMRC)
• Deal with all correspondence from HMRC including amending tax codes
• Calculate all statutory payments to your staff when required
• Know how much to pay HMRC each month or quarter
• Complete all relevant paperwork, for example P46
• Complete end of year returns

The Rowan Organisation has a Payroll service that can do all of this on your behalf if you wish.

When you are visited by a Rowan Adviser, they will explain to you how to access our Payroll service. You will be allocated a named payroll worker who will assist you in paying your staff. They will explain what you need to do and what information they need you to provide them with. For further information, please see Our Services.

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Will I need insurance?

If you employ your own staff, you will need to have Employers Liability Insurance and Public Liability Insurance to protect you against claims; for example if an employee is injured while carrying out work for you.

There are several companies that offer insurance tailored for Direct Payments users, two of which currently also offer legal advice and support as part of the policy. More details can be found in our links section. Rowan advisers can provide you with summary information which compares the policies these companies offer.

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Will I need a contract of employment?

Every employee is entitled to a Written Statement within two months of starting work. This should to be signed by you and the employee. It is recommended that you keep a copy for yourself as well as issuing one to your employee.
The contract will define the terms and conditions of employment and your responsibilities as an employer. The contract should include, for example:

• Employer & Employee names 
• Place of Work & Hours of Work 
• Conditions of work, including basic pay rate, weekend rate, unsocial hours rate, and definitions of these 
• Holiday entitlement 
• Business mileage travel expense rate 
• How and when wages are paid 
• Lay-off clause 
• Job Description 
• Confidentiality statement 
• Disciplinary, Dismissal and Grievance Procedures 
• Notice of Termination 
• Other various or optional terms and conditions

An adviser from the Rowan Organisation can help you to prepare a contract to issue to your employee. We have a standard contract that has been through legal and independent scrutiny and which can be customised to suit your needs.

There are other requirements of being an employer that will be explained to you in more detail by a local adviser. For example, your employee will be entitled to paid annual leave, maternity leave and certain other statutory rights. An adviser from The Rowan Organisation can help you work out any such entitlement and help you make sure you are fulfilling your obligations as an employer.

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Can I use someone who is self-employed?

In most circumstances, a personal assistant or carer will not be classed, under HMRC guidelines, as being self-employed due to the nature of the work. If your assistant is genuinely self-employed, they will normally be registered as such with HMRC and they will arrange their own tax and National Insurance contributions. It is strongly recommended that you ask to see proof of their self-employment status.

As a general guide, a worker is employed by you if most of the following statements apply to them:

• You tell them what work to do, when, where and how to do it
• They have to do the work themselves
• You tell them how many hours to work
• You can move them from task to task
• They have certain benefits, such as paid annual leave

As a general guide, a worker is self-employed if the following statements apply:

• They decide when, where and how to work
• They decide what jobs they do
• They can hire someone else to do the work for them
• You pay them an agreed, fixed price
• Their own finances are at risk

More detailed information can be found in the HM Revenue and Customs leaflet ES/FS1, ‘Employed or self-employed for tax and National Insurance contributions'.

It is important to note that some local councils have a policy that does not allow Direct Payments recipients to engage self-employed workers.  

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Can I use an agency?

Direct Payments can be used to purchase care from an agency. This means that you do not take on the responsibilities of becoming an employer. Instead, you will arrange the support required with the agency and they will invoice you accordingly. Your council can provide you with details of local agencies.

Some useful questions to ask an agency might be:

• What services are available?
• What charges will be made?
• Is the price all inclusive or are there any extras?
• Can I choose the person who provides my care?
• Will I get the same person each time?
• Can I contact you out of hours or in an emergency?
• What if I'm not happy with the service I get?
• What obligations will I have if I cancel the service?
• What insurance is in place?
• Are staff CRB checked?

For more information on any aspect of Direct Payments, please feel free to contact us and we will do our utmost to assist. 

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