1. Personal budgets Care Act 2014
This overview forms part of the suite of learning materials that have been developed to support the implementation of part one of the Care Act These materials summarise and explain the ‘Care and Support Statutory Guidance’ (October 2014) and are designed to help those involved in care and support services to understand and implement the Act.
This presentation is an overview of personal budgets. It is intended for anyone who would like to know more about chapter 11 of the statutory guidance.
There is an accompanying open learning workbook as well as a full presentation on this topic area.

2. Personal budgets Care Act 2014 Personal Health Budgets
Improving Life Chances of Disabled People
Personal budgets (PBs) give a clear upfront indicative (or ‘ball-park’) allocation of money at the start of the planning process, which will help people to develop their plan and make appropriate choices over how their needs are met. The final amount of the PB is confirmed through the planning process.
Personal budgets were first proposed in the report Improving the Life Chances of Disabled People in Individual budgets were piloted in England between and 2007, and the evaluation concluded that they were cost-effective in relation to social care outcomes and were welcomed by budget holders because they offered greater opportunities for choice and control. Personal budgets were subsequently rolled out from 2007 and have had the support of successive governments from all sides of the political spectrum. Personal health budgets were piloted in 2012; initially available for people who are eligible for NHS Continuing Healthcare, who have had a 'right to ask' for a personal health budget since April 2014 and this becomes a 'right to have' a budget from October Clinicians can also offer personal health budgets to others that they feel may benefit from the additional flexibility and control.
Personal budgets are a key part of the government’s aspirations for a person- centred care and support system. The Care Act places personal budgets into law for the first time, making them the norm for people with care and support needs. Why? The statutory guidance states that “independent research shows that where implemented well, personal budgets can improve outcomes and deliver better value for money.”
Total numbers of people having a PB has been increasing over the last few years. The POET survey (Personal Budgets Outcomes and Evaluation Tool) indicated that over 70% of people who hold a PB reported a positive impact on being independent, getting the support they need and want and being supported with dignity.

3. Care and support planning
Third party
Local authority
[Note. This slide has animation. The diagram appears when the slide opens, the first click brings in the ‘Local authority’ box and the second click brings in the ‘third party’ box to enable you to explain ISFs.]
This diagram illustrates the main elements of the care and support planning process.
If the local authority has a duty to meet a person’s needs (because it is required to or decides to meet needs) it must help the person decide how their needs are to be met, through the preparation of a care and support plan for those with ongoing needs or support plan for carers. The plan must describe what needs the person has, and which needs the local authority is to meet.
Everybody whose needs are met by the local authority will have a personal budget as part of the care and support plan/support plan that identifies the cost of their care and support and the amount that the local authority will pay towards it. An indicative amount should be agreed with the person at the start of care and support planning, with the final amount of the personal budget confirmed through this process.
The person can choose for the personal budget allocation to remain with the local authority to arrange care and support on their behalf, and in line with their wishes, or be placed with a third-party provider on the same basis, often called an individual service fund (ISF) or they can take some or all of the PB as a direct payment.
The personal budget is the mechanism that, in conjunction with the plan, enables the person to exercise greater choice and take control over how their care and support needs are met. What does exercising greater choice and achieving more control mean? For example, being able to choose from a range of options for how the money is managed.
The local authority is under an ongoing duty to keep the person’s plan and personal budget under review, to ensure that their needs continue to be met: they will review the plan periodically, involving the person and agreeing any necessary changes.

4. Elements of the personal budget
The personal budget must always be an amount sufficient to meet the person’s care and support needs.
The overall cost must be broken down into:
the amount the person must pay (following the financial assessment)
The remainder of the budget that the authority will pay
The personal budget must always be an amount sufficient to meet the person's care and support needs and must include the cost to the local authority of meeting the person’s needs which the local authority is under a duty to meet, or has exercised its power to do so.
It is vital that the process used to establish the personal budget is transparent and the method used robust so that people have confidence that the personal budget allocation is correct and therefore sufficient to meet their care and support needs.
The personal budget may be an integrated one which sets out other amounts of public money that the person is receiving, such as money provided through a personal health budget or benefits.
Alongside the PB, the local authority can present other costs to help the person understand the total charges to be paid. These other costs, which are not part of the PB, include top-up fees and any brokerage/administration fees that an authority might charge a self-funder who has asked the local authority to arrange their care and support on their behalf.

5. Calculating the personal budget
Transparency
Sufficiency
Timeliness
Good practice in personal budgets demands that the agreed budget is sufficient to enable the individual to achieve active citizenship. It is vital that the method used to calculate the personal budget is robust so that people have confidence that the personal budget allocation is correct.
There are many variations of systems used to arrive at personal budget amounts, ranging from complex algorithmic-based resource allocation systems (RAS), to more ‘ready-reckoner’ or non-points based approaches. Regardless of the process used, the most important principles in setting the PB are:
Transparency: Authorities should make their allocation processes publicly available as part of their general information offer, or provide this on a bespoke basis for each person the authority is supporting in a format accessible to them. This will ensure that people fully understand how the PB has been calculated.
Timeliness: It is crucial when calculating the PB to arrive at an upfront allocation to enable planning, this indicative amount is then adjusted to be the amount that is sufficient to meet the needs which the local authority is required to meet. This adjusted amount then forms the personal budget recorded in the care plan.
Sufficiency: The amount that the local authority calculates the personal budget to be must be sufficient to meet the person’s needs which the local authority is required to meet and must also take into account the reasonable preferences to meet needs as detailed in the plan.
The Act sets out that the PB must be an amount that reflects the cost to the local authority. In establishing the ‘cost to the local authority’, consideration should be given to the cost of the service at an appropriate quality, through local provision to ensure that the personal budget reflects local market conditions.

6. Use of a personal budget
Maximum possible range of options
Local authority managed PB
Third party managed PB (ISF)
Direct payments
Mixed package
The person should have the maximum possible range of options for managing the personal budget, including how it is spent and how it is utilised. Directing spend is as important for those choosing the council-managed option or individual service fund as for direct payments. Evidence suggests that people using council-managed personal budgets are currently not achieving the same level of outcomes as those using direct payments, and in too many cases do not even know they have been allocated a personal budget.
Local authorities should take care not to inadvertently limit options and choices e.g. “pre-paid cards” MUST not be used to constrain choice or be only available for use with a restricted list of providers.
There are three main ways in which a personal budget can be deployed:
managed account held by the local authority with support provided in line with the persons wishes
managed account held by a third party (often called an individual service fund or ISF) with support provided in line with the persons wishes.
direct payment
In addition a person may choose a ‘mixed package’ that includes elements of some or all three of the approaches above
Local authorities must ensure that whatever way the personal budget is used, the decision is recorded in the plan and the person is given as much flexibility as is reasonably practicable in how their needs are met.

7. Use of a carer’s personal budget
The carers personal budget must
enable the continuation of carer role
take into account carer outcomes
have regard to their wellbeing
The assessment of the carer’s desired outcomes must include their wishes and/or aspirations concerning paid employment, education, training or recreation if the provision of support can contribute to the achievement of those outcomes. The carer is entitled to have their eligible unmet needs met in the same way as the service user. The manner in which the personal budget will be used to meet the carer’s needs should be finalised as part of the planning process.
Local authorities must have regard to the wellbeing principle of the Act as it may be the case that the carer needs a break from caring responsibilities to look after their own physical/mental health and emotional wellbeing, social and economic wellbeing and to spend time with other members of the family and personal relationships. Wellbeing examples:
a course of relaxation classes
training on stress management
gym or leisure centre membership
adult learning
development of new work skills or refreshing existing skills (so they might be able to stay in paid employment alongside caring or take up return to paid work)
pursuit of hobbies such as the purchase of a garden shed
purchase of laptop so they can stay in touch with family and friends.