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Social Work (Scotland Act 1968, Sections 12B and 12C - Direct Payments
Draft Policy and Practice Guidance

Part 5: Direct payments in practice

124. Assessment for direct payments

125. Direct payments can only be offered to someone who has been assessed as needing either community care or children's services (or in the case of parents, where their children have been assessed as in need of services). The decision to offer direct payments therefore follows the assessment of an individual's needs and capacity.
127. In addition to the local authority's assessment of the person's needs, if the person has expressed an interest in receiving direct payments and is eligible then the process will need to include an assessment of whether direct payments are appropriate. In particular, it will be necessary to build in time to assess whether the person is able to manage them. The person also needs time (and possibly support- see paragraphs 114 to118) to think through the implications of taking on direct payments and to consider whether this is what he or she wants. They should make the person (and their supporter(s) or representative(s)) aware of the possibility of receiving direct payments at an early stage to give as much time as possible to think about it. Local authorities should also give the person as much information as possible about what receiving direct payments will involve, before asking the person to make their decision.
129. Some people may already have clear views about the activities with which they need assistance. Others may need help or encouragement to play a more active part in the process. This may mean practical assistance, such as providing interpreters for those who are unable or find it difficult to communicate in spoken English, more intensive advocacy support to help people to think through and ask for what they need, or simply allowing them more time. In some areas, self-assessment forms designed by user groups have been used to prompt people to think through the tasks with which they need assistance before their needs are assessed by the local authority.

130. Carers and assessments

131. It is already good practice for local authorities to involve carers wherever appropriate in the assessment of the person they care for. The 2002 Act now formally requires local authorities to take account of the contribution of carers who provide (or intend to provide) "a substantial amount of care on a regular basis", and the and views of the carer and the person they care for before deciding what services to provide to the cared-for person. Carers should be consulted and taken into account in the assessment of the cared-for person, irrespective of whether the person being assessed is likely to be offered direct payments or services after the assessment.
133. Carers are also entitled to an assessment in their own right of their ability to care. Local authorities have a duty to carry out an assessment of a carer's ability to care, if the carer requests this and is providing "a substantial amount of care on a regular basis" (under section 12A of the 1968 Act, as amended by the 2002 Act). The 2002 Act also gives local authorities a duty to inform carers that they may be entitled to such an assessment. A carer's assessment may be carried out separately, or combined with the assessment of the cared-for person.
135. The 2002 Act does not however, give carers an entitlement to receive services or direct payments in their own right. The purpose of any "carer's assessment" is to establish what level of care the carer is able or willing to provide, and establish what resources the carer needs to help them in their caring role, and maintain their own health and well being. Since carers have extensive experience and knowledge of the person they care for, an important aspect of the assessment is to seek the carer's views on the support needs of the person they care for.
137. The local authority must take account of the results of a carer's assessment, whether it is carried out separately, or as part of the assessment of the person they care for, in making decisions about the services to be provided to the cared-for person. This duty is not affected by the possibility that the person may be offered direct payments instead of services. The Executive issued draft guidance in November 2002 about carers' rights to assessment following the 2002 Act ¹⁷.

138. Deciding how direct payments are to be used

139. In order to satisfy itself that the person's assessed needs will be met, each local authority should discuss with anyone to whom it proposes to offer direct payments, how that person intends to secure the assessed services. Local authorities should make clear to people, before they start to receive direct payments, what the money may or may not be spent on, the conditions attached and how much flexibility the person has over the way the money is spent. Local authority will wish to bear in mind that the aim of the policy is to give people more choice and control over the provision of the services they are assessed as needing. To achieve this, some flexibility over the way the money is spent will be necessary. They will need to bear in mind the regulations which prevent people from using direct payments to secure services from their spouse, partner or a close relative living in the same household (paragraphs 70 and 71 refer).
141. Local authorities need to be satisfied, on an ongoing basis, that the person's assessed needs are being met, and that the money is being spent appropriately. (This should be included in any periodic review of the individual's needs and direct payments' arrangements - see paragraphs 163 and 164). They may set conditions on the direct payments to ensure this but they should not set conditions that are not necessary for the successful implementation of the Executive's policy in relation to direct payments or the discharge of local authority responsibilities (e.g. to ensure the proper use of public funds). Apart from the prohibitions set out in regulations or this guidance, local authorities should allow people to purchase services from any provider who is able to provide an adequate service to meet the individual's assessed needs. They cannot insist that a person contracts only with a provider who is registered with the Scottish Commission for the Regulation of Care.
143. Following the 2001 Act, certain community care services are subject to independent inspection against national standards by the Scottish Commission for the Regulation of Care (the Care Commission). Local authorities should make individuals aware that inspection reports on registered care services, including any conditions on the registration, will be made available to the general public by a variety of means including through the Internet ¹⁸. The Care Commission has been regulating day care provided by local authorities and independent and voluntary agencies (along with a range of other community care services) since 1 April 2002. Housing support service providers have been registered since 1 April 2003. Home care services will fall to be regulated - for the first time - from a later date, as will some other services such as offender accommodation, adult placement, adoption and fostering. An individual who wishes to purchase a registered service will be able to find out about its quality from an independent source. However it should be made clear to individuals that the new regulatory system does not cover situations where an individual employs a person directly (i.e. not through an agency) whether paid for through direct payments or otherwise. In these circumstances the responsibility for ensuring the quality of service rests with the individual.
145. It is possible for a local authority to agree to take over day to day responsibility of the direct payments from the individual, but it can only do so if the services are purchased from a registered service provider.
147. Local authorities are reminded of existing guidance ¹⁹, which states that services to be provided or arranged and the objectives of any intervention should be agreed in the form of a care/personal plan, a written copy of which should be given to the individual. Similarly when planning services for a child, a local authority should draw up a plan in writing with the family. This guidance applies equally where direct payments are provided in lieu of services.
149. Care/personal plans in relation to direct payments will need to cover all the areas discussed between the authority and the individual and set out clearly what has been decided. The plan should make clear to the individual what the money may or may not be spent on and how much flexibility he or she has in the way in which the money is spent. It should also include the type of variations to the package of services which the local authority would expect to be asked to approve in advance, the information the individual will be expected to provide for audit purposes and any other conditions which the local authority has set. Annex A to this guidance contains a checklist of points, which should be sorted out before direct payments start and which should be covered in the care/personal plan.
151. Local authorities will also wish to consider whether a legal contract with the individual is appropriate. This document should set out, in easy to understand language, the duties of the local authority as well as the individual. Local authorities should discuss the need for such a contract with their legal advisers.
153. Some people may already have ideas about how they would use direct payments, and may have discussed these with the care manager at the assessment stage. Other people may need advice or advocacy to help them think through the alternatives. The local authority could help people to obtain accurate information about local services that they might purchase. If it has not already done so, it might also consider at this stage whether there is a local support organisation with which it could put the person in touch.
155. In considering whether people's proposed arrangements will be adequate, local authorities should not be constrained by existing patterns of service provision. By exploring innovative and creative options, it may be possible to identify alternatives that both cost less and meet the individual's needs more effectively. Where the individual's needs fluctuate over time, it will be important to discuss in advance how the direct payments will be used to secure a package of assistance which varies according to need. Local authorities may also wish to consider offering someone a combination of direct payments and services, whether for an initial trial period or on a longer term basis.
157. While arranging and purchasing services from an agency or a local authority gives the individual more control than receiving local authority arranged services, many people will prefer to use direct payments to take on their own personal assistants as direct employees. This option gives them the most direct control over the assistance they receive, but it also carries the most responsibility (for example, to pay tax, national insurance contributions and statutory sick and maternity pay), so it will not be everyone's choice. However it is important to make people aware that this type of work can be handed over to a support organisation. Others may choose to contract with self-employed individuals or with independent agencies.

158. Best Value

159. Local authorities are reminded that they are required to operate within the principles of long-term best value. A local authority should consider carefully the cost-effectiveness of making direct payments against the services or equipment and adaptations that it would otherwise arrange. For example, a preventative strategy may necessitate a slightly higher investment to achieve long-term benefits and savings. In any comparison between the cost of direct payments and the cost of a service, the local authority should use the full cost of each, taking account of any administrative costs and other overheads. Local authorities may, if they choose, make direct payments at a greater cost than the cost of arranging the equivalent service. However, they must be satisfied that this is still at least as cost-effective as arranging the services. In considering whether the increased cost is justified, the local authority should take into account such factors as whether the person would be able to do more or to have a higher quality life or live more independently with direct payments. It is important for local authorities to recognise that there may be start up cost especially if the person decides to employ his or her own staff which may decrease once arrangements are in place.

160. Calculating the amount of direct payments

161. It is up to each local authority to decide on the amount of direct payments and on what they are supposed to cover. The Executive is not setting any limit on the maximum or minimum amount of payment, either in the amount of services it is intended to purchase, or on the value of the direct payments. The 1968 Act requires local authorities to make direct payments at a rate which, taken with any financial contribution from the person concerned (see paragraphs 148 to 152), is equal to the authority's estimate of the reasonable cost of his or her securing the provision of the service concerned. This means that direct payments must be sufficient to enable the recipient legally to secure a service of a standard that the local authority considers adequate to fulfil the needs for which the payment is made. Local authorities should consider the arrangements which each individual proposes to make when deciding on the value of payments. Local authorities will need to discuss with the individual the arrangements that he or she is planning to make and the costs that may be associated with this (e.g. National Insurance, sick pay, maternity pay, employers' liability insurance, public liability insurance, VAT). However, the local authority cannot be required to make direct payments to cover specific costs where there is a more cost-effective way of securing the service (whilst still enabling the individual to meet any legal requirements). Nor is the local authority obliged to fund particular costs which are incurred by the individual on a discretionary basis, which are not therefore essential in order to secure the service. Local authorities have discretion to decide whether to include an amount in the direct payments for costs, which they are not obliged to cover.
163. The local authority should also consider whether there are start up costs for the recipient, for example recruitment costs, and adjust initial payments accordingly.
165. There may be cases where an individual thinks that the total value of the direct payments should be greater than the local authority proposes and/or that his or her contribution should be less than the local authority proposes. In such cases, the local authority is under no obligation to increase the amount offered above the level which it considers reasonable to enable the recipient to secure the relevant services, taking account of the individual's contribution. The authority may decide to increase the amount nevertheless so as to enable the person to secure his or her preferred service if it is satisfied that the benefits of doing so outweigh the costs and that it is still cost-effective in comparison with services arranged by the local authority. Where these cases cannot be resolved through discussion, local authorities should advise the individual that he or she might pursue the matter through the authority's complaints procedure (see paragraph 181).
167. The local authority should give individuals as much notice as possible of the value of direct payments, and the contribution they will be expected to make to the cost of the service package before the payments begins, or its level is changed. This gives an opportunity for any dispute over the level to be resolved before the payments begin or the change takes effect. If that is not possible, then while any complaint is being considered, people may choose to manage on the amount of direct payments being offered, without prejudice to their complaint that it is inadequate. Alternatively they may choose to refuse to accept the direct payments, in which case the local authority must arrange the relevant services instead. If the local authority is satisfied that it would be a proper and cost-effective use of its resources, it may decide to pay direct payments at a higher rate than it had originally intended, until the dispute is resolved. This is entirely the local authority's decision; as always, it is up to the authority to decide on the appropriate level of payment.
169. Direct payments recipients can use their own resources to purchase additional, or better quality, services to those in their care/personal plan if they wish to do so for example ILF or Access to Work monies.
171. "Direct Payments Scotland" has produced a factsheet (number 6) offering advice on how to calculate the amount of a direct payment.

172. Assessing a service user contribution

173. Since 1 July 2002, disabled people aged 65 and over, have been able to request direct payments to cover the element of personal care (at home) which are now provided free of charge. Local authorities should refer to Executive circular CCD4/2002: Free Personal and Nursing Care ²⁰, particularly Section 5: Payment Mechanisms.
175. The 1968 Act enables the local authority to require the individual to make a financial contribution to the cost of the community care services he or she requires, by making direct payments of less than its estimate of the reasonable cost of securing the provision of the service concerned. Direct payments can therefore be made net of the contribution which the individual is expected to make. This is equivalent to local authorities' power under section 87 of the 1968 Act to levy a charge for services that they arrange. There should always be fair and equitable treatment between service users and direct payments recipients. Therefore, in considering whether, and if so how, to ask individuals to make a financial contribution, local authorities should treat people who receive direct payments as they would have treated them under the authority's charging policy if those people were receiving the equivalent services.
177. Alternatively payments may be made for the full cost of the service and the individual's assessed contribution can be recovered at a later date. Local authorities should take into account the views of users before deciding which approach to adopt.
179. In seeking to apply their charging policies fairly and equivalently to people who receive services and people who receive direct payments, local authorities should refer to the Executive's circular No: SWSG l/97: Charging for Adult Non-residential Sector Care ²¹ and CoSLA's guidance to local authorities on charging for non-residential care. While this is relevant in respect of housing support services it should be noted that people in receipt of housing benefit and those receiving housing support services on a short -term basis (up to 2 years) will receive these services free of charge. Details can be found in the Supporting People Charging and Financial Assessment guidance ²².
181. Under section 22(4) of the 1995 Act, local authorities have discretionary powers to charge contributions for children's services where the means of the family are sufficient.

182. Making payments

183. It is up to local authorities to decide how frequently payments should be made and whether in advance or arrears. It is important that where direct payments are financed from more than one local authority budget the individual receives one single payment to cover all the services he or she has been assessed as needing. Local authorities will need to set up mechanisms that enable them to monitor payments which are made and which minimise the risk of money being misspent. In considering what procedures to put in place, local authorities should bear in mind the likely effect of different alternatives on the circumstances of people who are likely to receive direct payments. Local authorities should bear in mind that making payments in advance would ensure that people are in a position to pay for services as they are received. Whatever the arrangements for payment, they will need to be reliable, as late or incorrect payments may put at risk the persons' ability to secure the services they need. The local authority may also need to set up procedures for making additional payments in emergencies, for example if needs change or regular payments go astray. Local authorities should tell people, before direct payments begin, how and when the payments will be made.

184. Monitoring direct payments

185. Consenting to receive direct payments means the individual taking on the responsibility for securing services to a standard which both the individual and the local authority consider is adequate. The local authority is relieved of its responsibility to arrange services for that person, so long as it is satisfied that the needs to which the payments relate will be met through the arrangements made with the payments. However local authorities should not make assumptions that someone who is not receiving services to their satisfaction cannot manage direct payments. It follows that the local authority will need to set up monitoring arrangements so as to satisfy itself that arrangements are meeting needs.
187. Monitoring arrangements should be consistent both with the requirement of the local authority to be satisfied that the person's needs are being met and with the aim of the policy to increase choice and independence. Local authorities should seek to focus on whether the person's needs are being met, rather than on the service being delivered in a certain way. The authority should discuss with people what steps it intends to take to fulfil its responsibilities in this area, and may also wish to discuss how it might support them in securing adequate quality of services.
189. Each local authority will need to ask itself how it would know if someone was experiencing difficulty managing direct payments. It may be appropriate to rely on someone who has been managing his or her own services for some time to ask for extra help if he or she needs it. However, local authorities should not rely on people asking for help, particularly when someone begins to receive direct payments for the first time. Regular reviews should be arranged to ensure that the local authority has an opportunity to discuss the direct payment's arrangement with the individual (see paragraphs 163 and 164). Where a local authority wishes to ask the person whether he or she is satisfied with the services he or she is securing, it should ensure that it communicates directly with the person wherever possible. In particular, it may need to use a different interpreter if the person may wish to comment on the services of his or her usual interpreter. Local authorities should seek to ensure that people do not feel inhibited from expressing reservations about the services they are purchasing, or about any other problems they are having in managing their direct payments, by a concern that their direct payments will be stopped automatically or arbitrarily. A local independent support organisation or independent advocacy service may help some people raise issues, which are giving concern.
191. Direct payments packages which include health services will require to be monitored by personnel with the necessary expertise to judge whether these particular assessed needs are being adequately met. In most instances this will mean that health care staff will need to be involved in the monitoring process.
193. Each local authority should also set up financial monitoring arrangements for audit purposes, to fulfil its responsibility to ensure that public funds are spent on the intended services. CIPFA have produced guidance for local authorities on this point and local authorities should ensure that up to date advice is being used.
195. Some independent living schemes have found spot checks helpful for this purpose and as a means of guarding against fraud (by the individual, their employees, or any person providing assistance to the individual to manage the direct payment). However, local authorities, which are thinking of using spot checks, will need to consider this very carefully and to bear in mind the need to respect the privacy of people who receive direct payments.
197. For direct payments to work, it is essential that these two forms of monitoring are co-ordinated. If they are not to be carried out by the same person, local authorities should ensure that information is exchanged and that all those involved understand the purpose of direct payments, and the role that the authority's monitoring plays in the successful operation of the policy. In particular, information from both forms of monitoring should be considered in any decision to change the level of, or to stop, direct payments.
199. As well as monitoring how well direct payments are meeting the needs of individuals, local authorities will wish to monitor how direct payments are working overall. In doing so, authorities should actively seek the comments and suggestions of people who receive direct payments or who have considered receiving them.
201. Local authorities should discuss with recipients the information they will be expected to provide and the way in which monitoring will be carried out. Direct payments should not begin until the recipient has agreed to any conditions, which are necessary for monitoring purposes.

202. Reviews and reassessments

203. The fact that the local authority is making direct payments rather than arranging services itself does not affect its responsibility to review the services the person receives at regular intervals. The projected timing of the first review should be set when direct payments begin. People should be made aware that they might request a review sooner if their circumstances change. The purpose of the review remains to establish whether the objectives set in the original care/personal plan are being met. However at review time the local authority will also wish to be satisfied that the individual is protected from exploitation and abuse. It may be helpful to consider first whether the person's needs have changed, before moving on to review how he or she is managing direct payments and how well direct payments are working.
205. Local authorities should follow existing guidance on carrying out reviews. Following the review, the amount of direct payments may need to be increased or reduced.

206. When difficulties arise

207. Difficulties can be minimised by good assessments, clarity (e.g. about what the money can be used for), monitoring, effective support arrangements (where these are necessary) and by discussing potential areas of difficulty, and how they will be handled, with the individual before direct payments begin.
209. Local authorities should discuss with each person what arrangements he or she will make for emergencies. Local authorities must ensure that the person receives the services he or she needs if the usual arrangements break down, e.g. through sickness of one of the person's personal assistants. It is reasonable for a local authority to expect the person to have contingency plans and these should be clarified at the outset. However if a local authority becomes aware that someone is unable to secure services to meet his or her needs, then its responsibility to arrange services for that person is the same as if it had not made any direct payments. The local authority will need to be prepared to respond in these circumstances just as it would with any other service user. It may decide to step in and arrange the necessary services, but it should first consider providing assistance to enable the person to continue to manage his or her own services.
211. Examples of contingency plans which people who receive direct payments might make include making arrangements with independent agencies for emergency cover, or recruiting personal assistants who are prepared to work additional shifts at short notice when necessary. However, it remains possible that difficulties will arise which have not been anticipated and which cannot be covered by the arrangements the individual has made. In these circumstances, it will be helpful if the direct payments recipient knows they can contact a named individual in the local authority or a local support service whom they can ask for help.
213. If the local authority's monitoring or review process reveals that the person's needs are not being met, or if the person contacts the authority to seek emergency assistance, the local authority will need to consider what action it should take. Good communication between the different parts of the local authority involved will be very important at this stage. This may mean helping people to make other arrangements, or it may mean arranging services directly until they are able to make their own arrangements once more.
215. When difficulties arise, the authority will wish to ask itself the following questions:

• Have the person's needs changed? If so, the person's needs should be reassessed and the level of direct payments should be reviewed.
• Is the amount of money sufficient to enable the person to secure the relevant services? It may be that experience shows that there are other costs which were not taken into account when the cost was calculated initially, or that anticipated costs have not, in fact, arisen. It may be necessary to review the level of direct payments.
• Is the person still able to manage direct payments? Local authorities need to continue to be satisfied that people can manage direct payments. However, difficulties will not necessarily mean the person cannot manage. There is inevitably a learning process when people begin to receive direct payments and people may make mistakes, but still be capable of managing direct payments in the longer term. Even experienced direct payments recipients may have problems at times but with some support, be capable of overcoming them.
• Does the person wish to continue receiving direct payments? As long as the local authority considers direct payments are appropriate, it should attempt to enable people to overcome difficulties and prevent them becoming discouraged when they experience difficulties. However if someone has decided that he or she no longer wishes to receive direct payments, then the local authority should enable him or her to switch to services.
• Has all the money been spent on the services for which it was intended? If the money has been diverted to other purposes there may be a case for considering seeking repayment. There may be a case for requiring repayment of some of the money even where the person has secured services to meet his or her needs, for example if he or she has secured the service for less than the expected cost and so there is a surplus. However the local authority should bear in mind that there might be a good reason for a recipient to build up a surplus, e.g. to pay his or her employee's quarterly PAYE. The local authority should explain before someone begins to receive direct payments the circumstances in which it would seek repayment.
• Have services for which the person has paid been received? If not, then it is the responsibility of the individual to seek a refund from the service provider. If the local authority has made further provision for services to meet the same needs or if the services were not received because they were no longer required, then it may wish to consider requiring repayment of the direct payment from the individual.
• Has the money been spent wisely? If not, the person may need more support to enable him or her to manage, or the authority may decide that he or she is not capable of continuing to manage direct payments and should receive services instead.

171. Since the introduction of direct payments concerns have been raised about local authorities being perceived as being liable for the actions of the recipient (e.g. the way in which recipients treats their employees). (Local authorities, which are concerned on legal liability, should also discuss this with their legal advisers.) Local authorities should also discuss this issue, and how it might be handled, with recipients and carers as part of their overall planning, monitoring and reviewing of the way in which they operate direct payments. In particular a local authority will wish to stress that it cannot help directly with the recruitment of staff (i.e. advertising, interviewing and selection), or get involved with terms or conditions of employment.
173. The Executive is working with "Direct Payments Scotland" to establish a mechanism for direct payments recipients to access enhanced criminal record checks on the people they are about to employ if they so wish. However it should be stressed that police checks alone do not guarantee that a person is suitable to provide children's services. Potential employers should be advised of the importance of having a rigorous recruitment procedure in place where the taking up of references is essential. The local authority should ensure that individuals are made aware of organisations that can offer help with these services and that the individual has all the assistance he or she needs.

174. Seeking repayment

175. The 1968 Act enables local authorities to require some or all of the money they have paid out to be repaid if they are not satisfied that it has been used to secure the provision of the service to which it relates. They may also require repayment if the person has not met any condition, which the authority has properly, imposed, and those imposed by the regulations. Local authorities which decide to require repayment by someone who they know is also receiving payments from the Independent Living Funds (ILFs) should inform the ILFs as soon as possible and should seek to agree if possible a common approach if the ILFs are also seeking recovery.
177. It is up to the local authority to decide when it is appropriate to seek recovery. However local authorities should bear in mind that this power is intended to enable them to recover money which has been diverted from the purpose for which it was intended, or which has simply not been spent at all. It should not be used to penalise honest mistakes. Local authorities should be satisfied before they start to make direct payments, that people who receive them understand all of the conditions they will be required to meet. Additional conditions should only be imposed insofar as they are necessary to ensure that the objectives of the Executive's policy in relation to direct payments are met and that the local authority's responsibilities (e.g. to monitor the use to which public funds are put) are discharged. Local authorities should take into account hardship considerations in deciding whether to seek repayments. When considering whether to recover unspent funds, local authorities should also bear in mind that there may be legitimate reasons for a recipient to build up an apparent surplus. This might involve outstanding legal liabilities, for example to pay an employee's quarterly PAYE, contingency funds to cover such eventualities as sick leave or to pay outstanding bills from an agency.
179. Local authorities should discuss with individuals, before direct payments begin, the circumstances in which it might wish to consider seeking repayment.

180. Discontinuing direct payments

181. Local authorities should not automatically assume when problems arise that the solution is to discontinue direct payments. If the local authority does decide to withdraw direct payments then it will need to arrange the relevant services instead, unless the withdrawal was following a reassessment after which it concluded that the services were no longer needed.
183. Either the local authority or the individual may decide at any time that they no longer wish to continue with direct payments. For example direct payments may be discontinued because:

• the local authority is not satisfied that the person's needs are, in fact, being met;
• the person is no longer able to manage direct payments;
• the person no longer requires a service, or
• the local authority has had cause to seek repayment of funds and has reason to fear that further payments may be misspent.

178. Clearly, wherever possible, the decision to discontinue should follow discussion with the individual and any carer, and the local authority should, in any case, keep the individual informed throughout the process. The local authority may also need to keep in touch with the Independent Living Funds (ILFs) and share information where appropriate in cases where the individual is also receiving ILF funding.
180. The local authority should inform people as soon as possible if it is considering discontinuing direct payments, and if appropriate give them an opportunity to demonstrate that they can continue to manage direct payments. Local authorities should set a minimum period of notice, which will normally be given before direct payments are discontinued, and include it in the information to be provided to people who are considering direct payments. It may be necessary in exceptional circumstances to discontinue direct payments without giving notice. For example where a child is the service user and it is clear that his or her welfare is in not being safeguarded. In considering this course of action, local authorities will first need to take account of the individual's contractual responsibilities with a service provider or an employee. They will also have to take into consideration any outstanding financial liabilities the individual may have. Local authorities should explain to people, before they begin to receive direct payments, the circumstances in which they might be discontinued with no notice and discuss with them the implications this has for the arrangements that people might make.
182. There may be circumstances in which the local authority wishes to discontinue direct payments temporarily. For example when a person does not require assistance for a short period because he or she is in hospital, or because his or her condition improves. Similarly when a person is temporarily unable to manage direct payments (perhaps again due to fluctuation in his or her condition or the support available). In these cases, the local authority will need to discuss with the person how best to manage. The aim should be to enable the person to resume responsibility for his or her own services after the interruption, if that remains his or her wish. The local authority might decide to take over the management of the person's arrangements in the interim. In considering whether it is practical, desirable and cost-effective to maintain the person's arrangements, the local authority should bear in mind any contracts into which the person has entered. For example it will not be able to contract with a service provider which is not registered with the Care Commission. Likewise it may not be practicable for the local authority to take over the employment of a personal assistant (see paragraph 134). How this situation is handled is an issue that the authority should discuss with the person before starting to make direct payments.
184. Where direct payments are discontinued, some people may find themselves with ongoing contractual responsibilities or having to terminate contracts for services (including possibly making employees redundant). The local authority will wish to discuss this with people before they begin to receive direct payments and agree how this would be handled. Local authorities should also consider how to recover unspent direct payments if the recipient dies. For example, if someone wishes to pay an agency in advance for its services, the local authority should bear in mind that it may be difficult to recover money paid for services which were not in fact delivered. Local authorities should also consider, if unspent funds are to be recovered, that before his or her death, the recipient may have incurred liabilities which should legitimately be paid for using the direct payments (e.g. he or she received services for which payment had not been made at the time of death). There may also be occasions where additional funding is required to settle liabilities in full.

185. Complaints procedures

186. Local authorities are required to operate a procedure for considering any representations (including any complaints) which are made to them with respect to the discharge of their functions or about any failure to discharge those functions. People who receive, or consider receiving, direct payments are entitled to have access to this procedure in the same way as anyone else for whom the local authority has a power or a duty to provide a service. It is important to ensure that people are aware of the complaint procedure, particularly when they are informed of a decision they may not welcome. People may make complaints about any action, decision or apparent failing of the local authority, but not about services which they have secured from independent providers (including people they employ directly) using direct payments. People should address any complaints that they have about the services they receive to the service providers. Alternatively, a complaint can be made to the Care Commission about any registered service or, indeed, about the actions of the Care Commission itself.

187. Resources

188. Direct payments are an alternative to services which would otherwise be arranged by the local authority, so direct payments must be meet from within existing overall resources. Direct Payments Scotland is working with four local authorities to carry out a finance action research project to consider how they might manage an increased take up of direct payments from 1 June 2003. In particular the work will focus on how existing budgets can be made more flexible and how a move towards direct payments might affect local authorities fixed resources. The project will conclude in autumn 2003 and the findings will be made available to all local authorities.

189. Statistical monitoring

190. The Executive will continue to monitor the progress of direct payments on a local authority basis. In particular it will be monitoring whether local authorities are carrying out their duty to offer direct payments to eligible people. Statistical Form F1 will be issued at the end of March each year for this purpose. A copy of the current form can be found in Annex D. Local authorities are advised to make sure that this information is collected throughout the year to ensure that the form can be completed in April each year.

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