You know your child’s routine, who puts them at ease, and what actually helps on a hard day. But the council keeps offering services that don’t fit.
Direct payments change that. Instead of the council arranging care, they give you the money to arrange it yourself. You choose the person, the timing, the activity.
What are direct payments?
Direct payments are cash transfers from your local authority. They let you purchase care and support for your disabled child directly, rather than accepting council-arranged services.
They’re set out in Section 17A of the Children Act 1989. The principle is simple: families know their children best and should have control over how care is delivered. Crucially, there is no means test for children’s direct payments. Parents’ income and savings aren’t assessed, and your financial circumstances don’t affect eligibility.
What can you spend them on?
Direct payments are flexible. They can fund:
- Employing a personal assistant (PA) for personal care, supervision, or support
- Short breaks and respite care (up to 120 days residential per 12 months)
- Community activities like swimming, clubs, or holiday schemes
- After-school care or holiday playschemes
- Specialist equipment (varies by Local Authority (LA) policy)
- Sitting services and home-based support
They can’t fund permanent residential accommodation, services not in the care plan, or items already purchased.
Direct payments can also be part of an Education, Health and Care Plan (EHCP) personal budget. Under Section 49 of the Children and Families Act 2014, personal budgets can include special educational provision, health provision, and social care provision.
How to get direct payments
The process starts with a social care assessment:
- Request an assessmentContact children’s services and request a social care assessment under Section 17 of the Children Act 1989.
- Assessment completedA social worker assesses your child’s needs and develops a care plan.
- Panel approvalThe Disability Panel reviews and approves the care plan.
- Direct payments agreementYou sign an agreement specifying how funds will be used.
- SetupA dedicated bank account or payment card is established.
- First reviewThe LA reviews the arrangement within 3 months.
If you already have a social care assessment or EHCP, you can request direct payments at any time. Write to children’s services stating clearly that you want direct payments under Section 17A.
Direct payments vs personal budgets
These terms are often used interchangeably, but they’re different.
A personal budget is an identified amount of funding in an EHCP. A direct payment is the actual cash you receive to purchase provision.
| Personal budget | Direct payment | |
|---|---|---|
| What it is | An amount identified in the EHCP | Cash transferred to you |
| Scope | Education, health, and social care | The spending mechanism |
| Who manages | Can be LA-managed, third-party, or direct | You manage it directly |
| Flexibility | Depends on delivery method chosen | Maximum flexibility |
Employing a personal assistant
Many families use direct payments to employ a PA. This gives you control over who works with your child. But it means becoming an employer, with real obligations.
Before your PA starts, you’ll need:
- An enhanced DBS check (arranged through the LA or an umbrella organisation)
- An employment contract covering hours, pay, holiday, and notice
- Registration with HMRC as an employer (at least 4 weeks before the PA starts)
- Employer’s liability insurance (minimum £5 million cover, typically £30-50/year)
The direct payment rate must cover all employment costs: employer’s National Insurance, pension auto-enrolment, holiday pay, and sick pay. If the rate offered doesn’t cover these, you can challenge it. Typical gross hourly rates range from £12.71 to £22.50 depending on the local authority (2026-27).
Most LAs allow direct payments to cover payroll service costs (£10-30/month). Using a payroll service removes most of the administrative burden and is strongly recommended.
What if the council refuses?
Councils sometimes refuse direct payments unlawfully. Cerebra and the University of Leeds (2018) found 41 out of 149 English councils had unlawful policies restricting disabled children’s access to social care assessments, including policies that imposed blanket eligibility restrictions on autistic children.
If direct payments are refused, follow the statutory children’s complaints procedure. Stage 1 must be responded to within 10-20 working days. If that fails, request a Stage 2 independent investigation, then a Stage 3 review panel, then the Local Government and Social Care Ombudsman (LGSCO).
Keep direct payment funds in a separate bank account and keep records of every transaction. Accumulating unused direct payments above £6,000 can reduce means-tested benefits, and above £16,000 can stop them entirely. Spend the money on care as intended.
Getting help
Contact (0808 808 3555) has direct payments guidance, template letters, and social care advice.
Cerebra offers free legal advice through its LEaP Project, including template letters and factsheets on direct payments.
Scope (0808 800 3333) advises on managing direct payments, employing PAs, and complaints.
Coram Children’s Legal Centre (0300 330 5485) provides free legal information on social care rights.
You have the right to choose
Direct payments put you in control of your child’s care. There’s no means test, the council must offer them, and you decide how the money is spent within the care plan.
If the council hasn’t mentioned direct payments, ask. If they’ve refused, challenge. The law is on your side.