SWSG Guidance Package Index Ref F.2.

January 1997

Primary Users:

Chief Executives, Unitary Councils and Islands Councils

Copy to: Directors of Social Work

Chief Social Work Officers

Directors of Finance

Holders of the SWSG/SWSI Circulars and

Guidance Package

Dear Colleague

CHARGING FOR ADULT NON-RESIDENTIAL SECTOR CARE

Summary

1. This circular provides general guidance, set out at the attached annex, on local authorities’ discretionary powers to charge for adult non-residential sector care which they provide or arrange under the Social Work (Scotland) Act 1968 and sections 7 and 8 of the Mental Health (Scotland) Act 1984.

Background to the guidance

2. Circular SW11/1991, "Assessment and Care Management" issued in June 1991, gave a specific commitment to provide Scottish Office guidance on (a) the proposed unified charging arrangements for those in the residential sector and (b) local authorities’ powers to charge for non- residential sector care. Guidance on the National Assistance (Assessment of Resources) Regulations 1992 outlined in Circular SW13/1992, and subsequent guidance on amendments to the regulations, met the former commitment.

3. Following initial discussion with the Association of Directors of Social Work (ADSW), SWSG consulted with local authorities and other interested organisations in February 1995. Subsequent to this, the guidance was amended to include 2 issues not previously addressed, namely charging for after-care services provided to the mentally ill particularly under the Mental Health (Patients in the Community) Act 1995 (paragraphs 6 to 9) and charging for services provided to terminally ill people in their own home. SWSG carried out a further, limited, consultation with ADSW and COSLA.

Status of the guidance

4. The guidance is intended to assist authorities in their charging activities. Given the discretionary nature of the powers to charge under section 87(1A) of the 1968 Act, it should not be regarded as prescriptive. It does not constitute a change in the Government’s view on the principles it would expect local authorities to adopt in charging for day and domiciliary services under the community care programme. It is intended to maintain consistency with advice set out in Circular SW6/83 on the implementation of the Health and Social Security Adjudications Act 1983 which inserted section 87(1A) into the 1968 Act.

5. Authorities should bear in mind that while they have discretion to follow the guidance they may, if challenged (for example by a member of the public or even a court), have to justify a decision not to act on it

Contact Point

6. Enquiries about this circular may be addressed to Mr Trevor Hall, Social Work Services Group, Room 44, James Craig Walk, Edinburgh EH1 3BA (Telephone 0131 244 5455).

Yours faithfully

GAVIN ANDERSON

ANNEX

DISCRETIONARY CHARGES FOR ADULT DAY AND DOMICILIARY

SOCIAL WORK SERVICES

DISCRETIONARY CHARGES FOR ADULT DAY AND DOMICILIARY SOCIAL WORK SERVICES

INTRODUCTION

1. Local authorities are empowered by statute to charge adult users of non-residential services, such as day and domiciliary care, taking account of the individual's ability to pay. These powers are discretionary.

LEGISLATIVE BACKGROUND

2. Section 87(1A) of the Social Work (Scotland) Act 1968 (hereafter referred to as the 1968 Act), as inserted by section 18 of the Health and Social Services and Social Security Adjudications Act 1983 (HASSASSA), and amended by Schedule 9 paragraph 10 (13) to the National Health Service and Community Care Act 1990, provides that:

"(1) Subject to sections 78 and 78A of this Act (contributions in respect of maintainable children) and to the following provisions of this section, a local authority providing a service under this Act or section 7 (functions of local authorities) or 8 (provision of after-care services) of the Mental Health (Scotland) Act 1984 may recover such charge (if any) for it as they consider reasonable.

(1A) If a person -

(a) avails himself of a service provided under this Act or section 7 or 8 of the said Act of 1984; and

(b) satisfies the authority providing the service that his means are insufficient for it to be reasonably practicable for him to pay for the service the amount which he would otherwise be obliged to pay for it,

the authority shall not require him to pay more for it than it appears to them that it is reasonably practicable for him to pay".

3. Local authorities should also note that section 14 of the 1968 Act was amended by Schedule 9 paragraph 10(6) to the NHS and Community Care Act 1990 which replaced the reference to "home help" services with "domiciliary services". Section 94(1) of the 1968 Act was amended by the NHS and Community Care Act 1990 Schedule 9 paragraph 10(14) in order to provide a definition of "domiciliary services".

SERVICES FOR WHICH CHARGES MAY BE MADE

General

4. Personal social welfare services provided for adults, including those with sensory impairment, under the 1968 Act for which charges may be made include:

- day care for elderly people, physically disabled and mentally ill people and people with learning difficulties

- lunch clubs

- domiciliary services (including meals on wheels)

- wardens in sheltered housing

- community alarms

- laundry services

- aids and adaptations for disabled people, including people with sensory impairment

5. The majority of these services would fall to be provided under section 12 of the 1968 Act as part of the duty of local authorities to promote social welfare generally. Domiciliary services and laundry facilities are specifically provided for under section 14 of the 1968 Act.

Services for the mentally ill

6. In addition to their general duty to arrange appropriate non-residential care services for mentally ill people and people with learning difficulties under the 1968 Act, local authorities also have a duty under Sections 7 and 8 of the Mental Health (Scotland) Act 1984 to provide after-care for such persons who are or who have been suffering from a mental disorder whether or not they have previously been in institutional care and including the provision of after-care services for persons subject to a community care order under the 1984 Act, as amended by the Mental Health (Patients in the Community) Act 1995. Schedule 10, paragraph 10(13) to the NHS and Community Care Act 1990 amended section 87(1A) of the 1968 Act to extend the range of local authority services for which charges can be made, to include such after-care services.

7. The 1995 Act amended the 1984 Act with effect from 1 April 1996. Most significantly after-care arrangements for persons subject to a community care order may be necessary for those who have been detained in hospital but are considered to be well enough to be in the community, including those on leave of absence for the new permitted maximum of one year. Previously many such individuals may have been out of hospital on longer term "leave of absence".

8. Although local authorities will continue to have discretion to charge for after-care services provided under Section 8 of the Mental Health (Scotland) Act 1984, the Department considers that former NHS patients with a mental disorder who are subject to supervision and community care orders should not be charged for non-residential social services provided or arranged by a local authority. This is because charging for services might add to the pressures of particularly vulnerable people who would find it difficult to cope in the community without the provision of statutory after-care services. It also recognises the fact that clients do not have the option to refuse services provided under a community care or supervision order. Charging should only apply where the community care order has totally ceased to have effect.

9. The Criminal Procedure (Scotland) Act 1995 came into effect on 1 April 1995. New powers contained in that Act now allow that, following a conviction, an acquittal on grounds of insanity or the requisite finding at an Examination of the Facts, a criminal court may impose a hospital order, a guardianship order or a supervision and treatment order On a similar basis to the position described at paragraph 8, in the Department’s view, such individuals should not be subject to charging for services provided by local authorities where those services are initiated by an order of a criminal court. Charging should only apply where the statutory supervisory arrangements have ceased to have effect.

Services for physically disabled people

10. Local authorities have a duty under Section 2(1) of the Chronically Sick and Disabled Persons Act 1970 (as applied by the Chronically Sick and Disabled Persons (Scotland) Act 1972) to provide practical assistance in the homes of disabled people, including additional facilities intended to ensure greater safety, comfort or convenience. Authorities are also required to provide meals either in the person's home or elsewhere. Functions under the 1970 Act are treated as functions under the 1968 Act.

Services for the terminally ill

11. Where, after a multi-disciplinary assessment, the diagnosis reveals that a person is terminally ill and requires specialist palliative health care, the NHS is responsible for arranging and meeting the full costs of health care provided whether this is in a hospital setting or, where practical or appropriate, in the community. This includes palliative care provided to terminally ill patients in their own homes, again, where this is practical and appropriate. Such persons may also require social welfare services from the local authority social work department. Where authorities are responsible for providing such services under the 1968 Act, the Department would encourage authorities to exempt the client from any charge, depending on the sensitivities of the situation and the financial circumstances of the individual.

12. The broader strategic issue of meeting health care needs and collaboration between Health Boards, local authorities and other agencies was addressed in Circular NHS MEL(1996)22, NHS Responsibility for Continuing Health Care.

SERVICES FOR WHICH CHARGES CANNOT BE MADE

13. Criminal justice social work services are provided under section 27 of the Social Work (Scotland) Act 1968. The charging provisions of Section 87(1) and (1A) of the 1968 Act do not apply to such services as they are, in effect, services to the courts and the Secretary of State, rather than to an individual.

14. Local authorities are not empowered to charge for providing advice or guidance about the availability of services or for the assessment of community care needs. Nor should they charge for care management as this is separate from the service delivery function.

SETTING THE LEVEL OF CHARGES

15. The legislation requires that any charges levied must be reasonable and should not be more than appears to be reasonably practicable for the service recipient to pay, taking account of his or her other financial commitments. It is for the authority to decide what is reasonable in each case. Charging policies which discourage the take up of services may not be in the best interests of users, carers or providers. No-one who has insufficient means to pay a charge should be denied a service because of his or her inability to contribute towards its cost.

16. In the Government's view, in setting charges (whether flat rate or on a scale), authorities should take account of the full cost of providing the service. In calculating the full

cost of providing the service, local authorities should take into account capital, managerial and other overheads directly attributable to service provision, but not costs associated with the purchasing function and not the costs of operating a charging system.

17. Authorities should seek to ensure that charges for similar services are consistent throughout their area. Where, however, the full cost of the service varies within an authority (eg because different providers are used for different areas or the difference between service provision in an urban and rural environment) it is for the authority to decide whether the charges to individuals should reflect these cost differences or whether to have one notional average charge for all recipients. Where charges do vary, the authority should be able to explain to the service users the reason for this.

18. When reviewing their charging policies for individual services, authorities should take account not only of the charge for individual services, but also of the total impact in terms of ensuring that the financial effects of their charging policies are consistent with the Government’s overall community care policy objectives. This should necessarily entail consideration of the impact of increasing their charges on both potential clients as well as those who are already contributing towards their care costs.

19. In deciding on their detailed charging policy, authorities will also wish to have regard to the costs of administering the arrangements, particularly for assessing means and for collecting the charges. The operating costs of a very complex system of financial assessment may reduce the net benefit of the charges collected. Cumbersome arrangements for assessing ability to pay are not in the interests of local authorities.

20. Authorities are reminded that the basis of the Mental Illness Specific Grant is that the central government contribution of 70% will be matched by a local government contribution of 30%. When income from charges reduces net expenditure on grant supported projects, expenditure must remain in the ratio of 70:30. Where there is income from charging which has not been allowed for in a grant application, that income should be used to reduce both the central government and the local government contribution so that the ratio remains at 70:30; alternatively it may be used to increase the services offered by a grant supported project if the project description remains consistent with the application approved by Ministers.

CHARGING SYSTEMS WITHIN CONTRACTS

21. Only local authorities are empowered to set and recover charges for the services arranged by the authority. In practice, local authorities may delegate the collection of charges to a provider contracted by an authority but should seek their own legal advice on the extent to which this may be done. The power to set charges and assess the charge paid by each user cannot be delegated. This means, for example, that providers may not vary or waive a charge which the authority have decided to recover. Wherever practical, charges should be paid direct to the authority. Where an individual pays the assessed charge to the independent provider, it should be made clear to the user that any collecting of charges is being done on behalf of the local authority and any revenue collected is remitted to that authority. Any charges for additional services provided under private agreement between the provider and service user should be separately identified. See also paragraph 22 below.

22. It is open to a provider contracted by an authority for a particular level of service to offer to provide additional services to individuals among the group as a private arrangement. For all types of services, including non-residential as well as residential accommodation, the contract specification should clearly set out the services to be provided within the contract, and the authority should ensure that it is aware of any other services which the provider is making available to individual users at an additional price. The authority should make clear to individuals that they have a choice whether to accept the offer to provide additional services. Services provided free by a voluntary organisation or under other arrangements should not be subject to a charge. See also paragraphs 28 and 29 below.

JOINT LA/HB SERVICES

23. There are many different circumstances under which local authorities and Health Boards work together to purchase services for users. Charging for such services is a complicated area, and if charges are to be made it is clearly desirable that the details be devised having full regard to all the implications. Local authorities may charge for services up to the level that the services cost even where local authorities and health boards arrange jointly for social care services. If a local authority purchases social care and a Health Board purchases health care services from the same provider, then charges to users may only be made for the social care element. Where necessary, authorities should clarify for users the distinction between health and social care both generally and in the context of the charging arrangements.

DISCRETION TO REDUCE OR WAIVE A CHARGE

24. When an individual service user considers that he or she cannot pay the charge that has been set, Section 87(1A) of the 1968 Act gives the user the right to ask the authority to reduce or waive a charge. Under the legislation, before it decides to reduce or waive a charge, the authority must be satisfied that the service recipient’s means are insufficient to pay the amount they would otherwise be charged. Any means test must be confined to the means of the service user (see paragraphs 28 and 29 below). Further guidance on what means should be taken into account is given at paragraphs 32 to 35. An authority would be expected to take account of any subsequent change to a user’s financial circumstances and review the level of charges accordingly.

25. The Government do not consider that there should be an automatic exemption from charges for people receiving Social Security benefits such as Income Support, Attendance Allowance, Incapacity Benefit, Housing Benefit, Severe Disablement Allowance, Social Fund Payments, Disability Living Allowance (but see paragraph 34) or Disability Working Allowance. However, for them as for other service users, including those who are eligible for DSS benefits but who do not claim them, authorities should have regard to the amount of the charge in relation to the individual's overall financial position (subject to paragraphs 32-36 below). Authorities should, however, seek to ensure that service users are made aware of any Social Security benefits to which they might be entitled.

26. Representations from people receiving welfare benefits and those on very low incomes should, however, be given sympathetic consideration. Authorities may wish to have regard to the distinction between income maintenance and benefits which relate to meeting an individual’s care needs. Authorities will wish to bear in mind when setting a charge that benefits cannot be increased to enable the recipient to meet charges for care. Consideration should also be given to the impact of the charging arrangements on those leaving long-stay institutional care and who depend to a greater or lesser extent on DSS benefits as their principal means of support.

27. As care plans in future may become more complex, involving an increasing number of services which are more responsive to the individual's needs, consideration should be given to the total of the charges for these services so that there is no disincentive to greater creativity in care planning. Local authorities should, wherever possible, avoid undue burdens falling on individuals because of the aggregate of charges for different services.

WHO MAY BE CHARGED?

28. Under section 87(1A) of the 1968 Act authorities may charge only the person receiving the service and should have regard only to that individual's means in assessing his or her ability to pay.

29. In the Department’s view, parents and other members of an adult service user’s family cannot be required to pay the charges, except to the extent where another member of the family is acting on behalf of the service user and is therefore responsible for paying any charges on his or her behalf. Local authorities may, in individual cases, wish to consider whether a client has sufficient reliable access to resources, other than his or her own resources, for them also to constitute his or her means for the purposes of Section 87(1A). The most likely instances of this kind will arise in relation to married or unmarried couples. It will be for the authority to consider each case in the light of their own legal advice.

30. The proprietor of a residential care home, nursing home or other residential provision is responsible for providing whatever daytime activities are specified in the residential care contract with the local authority for each resident. Depending on the terms of the contract agreed with the local authority (see paragraph 22 above), these activities may be provided directly by the proprietor, or the proprietor may arrange them with another provider. If the residential care contract includes such activities, the costs should have been included in the contract price, and the resident's charging assessment for residential care will have been calculated against that contract price. In these circumstances, the resident cannot be charged an extra sum for these activities. If the proprietor arranges for some of the activities specified in the contract to be provided by a third party, this will be a private arrangement between these 2 parties, and again the resident should not be charged an extra sum.

31. There may be instances where a local authority assesses a resident as requiring specialised activities which are not included in the residential care contract. In these circumstances, if the local authority wishes to recover a charge for the service the authority will need to charge the resident direct, bearing in mind the amount the resident will have remaining after his residential charge has been calculated and his other outgoings have been taken into consideration.

INCOME THAT MAY BE TAKEN INTO ACCOUNT

32. In assessing ability to pay, authorities may take into account all types of income, including income from capital, and social security benefits, (see also paragraphs 25 and 26) except the Mobility Component of Disability Living Allowance (DLA) and the War Pensions Mobility Supplement disregard (see paragraph 34). Authorities should, however, have regard to not just the service user's income, but his or her overall financial circumstances. In particular, they should have regard to any extra expenditure that may be incurred because of the service user's disability or frailty.

33. In constructing a package of care services, authorities should consider the extent to which the parts of the service to be provided or arranged by the authority, and for which charges are usually imposed, will contribute to meeting the individual's overall care needs; and to what extent further care needs will have to be met from other sources for which some further expenditure will be necessary. They should ensure that the charges levied do not result in the service user being left without the means to pay for any other necessary personal care.

34. The Mobility Component of DLA may not be taken into account for charging purposes. Section 73(14) of the Social Security Contributions and Benefits Act 1992 requires these payments, or the right to receive them, must be disregarded in any charging schemes which have regard to a person's means. The War Pensions Mobility Supplement should also be disregarded in a similar manner.

35. An authority may levy its usual charges in respect of services it provides to a severely disabled person under the Independent Living (1993) Fund arrangements. However, payments made from the Fund, in addition to local authority service provision, should not be taken into account.

PEOPLE WHO REFUSE TO PAY

36. Once someone has been assessed as requiring a service but the person concerned refuses to pay for it, the service should not be withheld or withdrawn where it is clear that the service is essential to the person's well-being. It is, however, open to an authority to pursue the debt while continuing to provide the service. The authority should nevertheless consider the cost-benefit of pursuing the debt.

INFORMATION

37. Authorities should make generally available information about their charging policies and procedures in a style that is readily understood and accessible to users and potential users, including those with sensory impairment, as well as their carers. It should also be made available to those, such as GPs and community nurses, who refer individuals to community care services. When individuals’ care needs are assessed, information about charges should be provided in respect of all services that may be potentially relevant to them. Such information should be given to them at the same time that they are given written information about the care assessment process and the available services. Individuals should also be notified of any subsequent change in charging rates or policy before it is imposed.

38. Users should be given an accurate indication in writing of the charges that they will incur as soon as practicable and preferably before they are required to commit themselves to a particular care plan. It is only in exceptional circumstances such as emergency admissions, that local authorities may be able to justify not doing so. Users should also be given a written statement of their financial liability at the earliest opportunity, with access to advice and explanation as required. They should also be given a regular financial statement, eg monthly or quarterly, about the payments they have made. Although it would not be feasible to consult individuals on any proposed change to the charging system, existing users should be consulted through representative organisations.

39. Information should be available in the language spoken by users in the area of the local authority or should be available to non-english speaking ethnic groups by some other means, such as translation by family or friends. Information should also be available in a format appropriate to people with visual impairments.

COMPLAINTS

40. Authorities should ensure that all service users and potential users know what arrangements are in operation to enable them to make a complaint under the community care complaints procedures about any charging decision with which they disagree. Users should also be made aware about how to make representations if they find it difficult to pay the charges. The procedures generally were outlined in Circular SW5/1996 "Complaints Procedures" issued in March 1996 and in the Practice Guidance "A Right to Complain" issued in August 1991. Information about complaints procedures must be readily available and in a form that is easy for users and carers to understand.

MONITORING

41. When charges are introduced for the first time for a service (or services) and when changes are made to an existing charging system, authorities will want to monitor carefully the effect on service take-up and use.