More information on Options 1 and 2
Option 1 – Direct Payment
It is recognised that of the four options available under the 2013 Act, the direct payment, if constructed and developed on a sound basis, carries the greatest level of flexibility and responsibility.
Direct payment rules are set out in the statutory guidance accompanying the 2013 act and the Self-directed Support (Direct Payments) (Scotland) Regulations 2014.
Section 4(2) of the 2013 Act defines a “direct payment” as a payment of a relevant amount to the supported person for the purpose of enabling the person to arrange for the provision of support by any person (including the authority). It explains the meaning of the term “relevant amount” as the amount that the local authority considers a reasonable estimate of the cost of securing the provision of support for the supported person.
The ‘reasonable estimate’ is based on rates approved by the council and is equal to the cost to the council of providing the service.
Under a direct payment the supported person - or an organisation or individual identified by the authority (under a “third party” direct payment) - receives a sum of money into a bank account. The supported person, either on their own or with support, can then purchase the support that they wish in order to meet their eligible needs and personal outcomes.
Certain choices, such as the decision to become an employer, will only be available under the direct payment option. However, a supported person can also use their direct payment to purchase a range of services that might otherwise be available under Options 2 to 4. For example, a direct payment can be used to purchase services from a registered care provider or from the local authority itself. The direct payment is not only a route to employing personal assistants.
A direct payment is not a benefit and nor is it a gift. It is a means to meet assessed eligible needs. The direct payment should be used in flexible ways which relate to the outcomes set out in the outcomes support plan/child’s plan. A key principle behind direct payments is that they can be used to purchase anything provided that it meets the eligible assessed needs of the supported person and is not illegal. It must be demonstrated that the outcomes are being met.
The council will assess a supported person’s ability to contribute to the cost of securing their support. The statutory guidance requires the authority to carry out such a means test before the direct payment is made or as soon as possible and no later than one year after the direct payment has been made.
There are certain additional responsibilities that come with a direct payment to use the payment to meet the assessed needs and outcomes within the outcomes support plan/child’s plan or carers plan:
- to report back in a proportionate and reasonable way on how the funding is being spent; and
- where the supported person chooses to employ a Personal Assistant, the responsibility to be a good employer and the responsibilities to discharge the range of additional responsibilities that come with being an employer.
South Lanarkshire Council has engaged the Glasgow Centre for Inclusive Living (GCIL) to provide independent and impartial advice and information to supported persons and carers. The service is known as Take Control South Lanarkshire and is based at 42 Campbell Street Hamilton.
Employment of close relatives- Where the supported person wishes to consider employing a close relative, the authority will explain the considerations involved and the discretion that the local authority holds to either agree or disagree to any such arrangement. The authority retains a decision-making role in relation to allowing close relatives to be employed using state funded direct payments, and that such arrangements should occur only where appropriate and where they meet the criteria established in the statutory guidance.
Monitoring and review arrangements - The authority will discuss with the supported person the information they will be expected to provide and the way in which monitoring will be carried out. The direct payment arrangement will not begin until the supported person has agreed to any conditions which are necessary for monitoring purposes.
The council will undertake periodic financial reviews of the direct payment to ensure that it has been used in accordance with the agreed outcome support plan and will recover any unspent funds beyond the agreed contingency level.
Terminating Direct Payments - Under the Direct Payment Regulations 2014 the authority can terminate the direct payment under certain circumstances. The authority will make this clear to the supported person at the outset.
Option 2 – Individual Service Fund (ISF)
An Individual Service Fund (ISF) is one way of managing an individual budget available under Option 2 of the Self-Directed Support Act.
The purpose of Option 2 is to facilitate greater choice and control for individuals, supporting them to choose the provider of their choosing, with the authority (or subsequently the provider) making arrangements on the individual's behalf.
Option 2 widens the flexibility for individuals to the maximum possible extent, providing a route to greater choice and control for those individuals who want to take greater control over their day-to-day support but who are not willing or do not feel ready or able to choose the direct payment option.
The key limitation is that a person cannot use Option 2 in order to employ their own staff. Unlike the direct payment there is no requirement for the funding to be provided directly to the individual as a cash payment. The budget provided to the person should be operated as a virtual budget. The resource can remain with the local authority or it can be delegated to a provider to hold and distribute under the individual’s direction.
The council has contractual arrangements that operate as a formal framework agreement or other similar arrangements. The statutory guidance recommends that arrangements should be flexible and inclusive. Flexible in that they should not seek to create or re-impose barriers to the choice and flexibility available to individuals. Inclusive in that they should not seek to exclude particular types of service provision or particular providers from the full range of supports available to the person. The key determinant is that the support must be able to demonstrate that the outcomes are being met.
Any provider not known to the council can be added but will only be added once fit for purpose checks are completed.