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Financial management of personal budgets in adult social care


Posted by Andy McKeon, Managing Director for Health, Audit Commission
How are councils progressing towards the milestone of 30 per cent of adult social care service users having a personal budget? What challenges are they facing – and who is doing it well?

These are some of the topics covered in the Audit Commission’s new report Financial management of personal budgets. We focused on the financial management and governance implications for councils. The report reviews approaches to the transition to providing personal budgets and the choices for allocating money. It also considers the changes in social care commissioning needed.

Inevitably, some councils are further along the road than others. Introducing personal budgets for some service user groups is also proving more difficult than for others.

A personal budget is an allocation of money given to a person to spend on a support plan. The budgetholder develops their support plan with social care professionals to meet a jointly agreed set of needs and outcomes. Choice and control increase because budgetholders can spend the money on a wider range of services. The personal budget can be taken as a direct payment for the holder to spend as they choose on their support plan, or can be managed by the council, a friend or family member.

We visited eight councils for detailed case studies, and found real commitment, and some interesting and different approaches to implementing personal budgets.

Councils should not expect significant cost savings – perhaps a blow to some councils following the spending review. The real benefits come in transforming users’ lives, giving them more independence, choice and control. But personal budgets will still affect how councils draw up their financial plans based on the likely cost and demand for social care in future.

Some councils could struggle to meet agreed milestones, whereas others have achieved a lot in a short time and are leading the way. Learning from peers will be vital, as others will already have solved the challenges they face.

The subtitle to our report is Challenges and opportunities for councils. The biggest challenges are cultural. Changing professionals’ attitudes to assessing potential users and helping them identify the right services can be a major task. Explaining the opportunities to social care users is also vital. Take-up will increase when social care users can see how they could benefit.

Differences in take-up between service user groups exist - numbers of mental health personal budgets are low. This suggests a need for much better partnerships between the NHS and social care, a theme we discuss in our 2009 report Means to an End.

Personal budgets are improving people’s lives. However, not all service users can make the system work for them without support. Our report outlines how councils are providing a new style of brokerage services to help people get the most from their personal budget. However, personal budgetholders may choose not to use council’s in-house provided care services in favour of cheaper, or more personalised choices. This presents a risk to the affordability of council’s in-house services. They also require changes to financial and management information systems, for example putting in-house services onto a trading account. And a new awareness of how fraud and abuse can arise.  

Personal budgets can encourage people to make use of everyday council services. Social care departments are often working well with other departments to promote leisure services or helping personal budgetholders get education and training, and increase their employment opportunities.

The government will set out its vision for social care in November – and reaffirm its commitment to personal budgets. However, the transformation funding is due to end in April 2011. Councils will need to maintain the momentum once this funding runs out.

Editor's Feature
Andy McKeon
Managing Director for Health,
Audit Commission
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