I have a client who is the primary carer of her terminally ill mother in law.. who lives with her..

My client receives a payment for this from Social Services.. She receives what looks like a wage slip from them... She says this is called a direct payment.. I have done a bot if research about them, so understand what they are paid for..

My question is how are they regarded by the HB dept..?

Is it wages or benefit income.. We have done a bencal using this income (£470 per month) as both earnings and benefit income, and the results for HB entitlement, come out very differently.. Much more if assessed as benefit = HB... If assessed as wages, then no HB...

Can anyone shed any light so I can inform my client to put in a claim for HB ... x

What "benefit" did you treat it as in your calculations?

As far as i understand direct payments (and i stand to be corrected) is that they are paid to the disabled person who then employs a carer and pays them a wage.

Tue 12-Aug-08 11:39 AM by pipkin

I did it as wages on the Lisson Grove calc.. a colleague did it as a benefit on the Councils Housing online calc.. I think (bit cant be sure) that he put it in as a carers allowance..

From what you've said it's not carers allowance - sounds like wages to me.

Tue 12-Aug-08 01:03 PM by Kevin D

Perhaps the wages issue can be determined by the question of whether or not the person to whom the money is payable is employed in order to receive such payment in lieu of relevant services?

See CIS/1068/2006. If the case is analogous then the payments will probably be earnings.

You need to identify who is the recepient of the DPs, as both carers and the person with disabilities can receive DPs. If the carer receives DP in their own right then they are disregarded. If the person with disablities receives the DP and pays it to someone else then it becomes wages - see Casewell v Secretary of State for Works and Pensions. This is the further appeal against CIS/1068/2006 referred to above, but it had the same outcome.

Im really confused with this one.. client states it is called a direct payment from social services, but has shown me what look like wage slips for this money.. I am led to beleive from reading about direct payemnts that they are made to the person with a disability, not the carer...

I know she pays tax and NI on the payments as she said this is sorted out for her..

Arghh..

Ah that CD does say this..

“She states that they do not make the payments – these are local authority payments. They just provide a payroll service for the local authority. The customer completes a form re the hours of care that she needs and they then produce a wage slip for the person that the customer employs – telling her how much she should be paying.”

Direct Payments are made under the Community Care (Direct Payments Act 1996 and the Community Care (Direct Payments) regs 2003 (SI 2003/762). They can only be made to, and with the agreement of, a person whose needs have been assessed by Social Services as requiring the provision of a service. This could include a carer whose needs, as a carer, have been so assessed (eg. needs for respite care, commonly).

Under these circumstances, Social Services can, instead of providing a service themselves to meet the assessed need, either in-house or contracted, make direct payments to the person whose needs have been assessed. That person can then buy in their own services, either from an agency or by employing someone themselves.

Where a service user chooses to employ someone, they take on all the responsibilities (tax, H+S, employment rights) of an employer. To assist with the burden of this Social Services should provide support services, either in-house or contracted out. This often includes a payroll service.

I don't think there is any doubt in the present case that the legal position is that the mother-in-law has been assessed as requiring services by Social Services as requiring a service; has chosen to have this service provided by the daughter-in-law; and has employed the daughter-in-law for that purpose. The payments are therefore wages paid by the mother-in-law.

This will not have been properly explained at any stage to the clients; they will have been pushed down this route by Social Services who are so incentivised ("choice", "personalised services" etc).

To add to the confusion the mother-in-law will have been financially assessed by Social Services under the local charging policy and may or may not have to make a contribution to the cost of her services; this contribution may be deducted from the direct payments (ie. from the daughter-in law's wages) in which case it is payable direct by the employer (the mother-in-law) to the employee (the daughter-in-law); or it may be payable separately to Social Services by the mother-in-law.

Invariably overlooked in setting up these arrangements are the effects of direct payments on both parties benefits. The only disregard is for Direct Payments when received by the person assessed as requiring services - who should basically just be a conduit for the money. When they pass the money on it changes form and usually becomes just wages. If the family as a whole would be better off without Direct Payments, eg claiming CA and IS instead, they can always withdraw from the arrangement.

Richard Atkinson

Thank you Richard, That explains the situation wonderfully.. x

Also good to hear the arranegment can be terminated - with out sanction, if the alternative situation (IS & CA) would be better for the client...

I will do a benefit calc based on this info, as cli would defiantely be better off on IS as she would then be entitled to full HB/CTB..

At the mo, due to these payments, she is not entitled to any HB/CTB.

I'm not aware this has been tested, but we've talked about it in the office a number of times. Is there any reason why a carer cannot get earnings via direct payments and Carer's Allowance at the same time? the service user will have been assessed as needing a certain number of hours/wk personal care, and the direct payments will cover these hours. Provided the carer provides a further 35 hours/wk care (which should be easy to justify if the disabled person is terminally ill, on DLA h/care or h/AA, therefore has day and night time needs), wouldn't the CA condition be met?

Not stricly a benefit issue, but there might be a status discount as a carer available on the council tax.

"earnings via direct payments" - DPs are not of themselves earnings. They only become earnings when they are used to pay someone else. So a carer receving DPs in their own right wouldn't be receiving earnings, and so wouldn't fall foul of the earnings rule for CA. If this is correct then the above would work.

Equally, if the person was actually "earning" the money (ie the cared for person received a Direct Payment, and paid the carer to care), as long as those earnings do not exceed the CA earnings limit and 35 hrs of substantial care is provided in addition, then I can't see a problem in getting both. the increase of earnings limits for carers will obviously make this option more attractive and feasible.

of course, whether a carer is better off on CA or DPs, or combo is different in every case..so for example, if a cared-for person has a need (met by Soc Services) for say 16hrs care a week, and has DPs to cover those hrs...it may be possible (and advisable) for her to employ 2 carers at 8hrs each/3 carers or any combination/permutation, with one carer therefore retaining CA aswell as the income from the DP...or it may be that the carer on CA is better off providing the full 16hrs care themselves (this will obviously depend on their own circs and other benefits etc, as they may - for example - want to remain on IS/HB/CTB, and the Carer Premium may be the difference)

....as DPs are roughly (around here anyway) at around £12-13 per hour then an extra 8hrs may offset any losses..but not always.

There is then the question of the cared-for person possibly having to contribute to DP's (as discussed above in previous posts) and that, alongside possible loss of SDP due to CA claim, may make it even more complicated. As advisers in these circs, we have to be aware of the potential for conflict of interests between carers and cared-for.

So you can get DPs & CA paid for the same person at the same time..???

To confuddles this further then, cli gets DPs for being primary carer of her MiL.. But she also has a 15 year old son who gets mid rate DLA.. So could she get DPs for MiL and CA for son...????

would say so...however if the DPs are paid to MiL who then pays your client a "wage" (as it were) from those DPs then the income threshold for CA would obviously be a factor....careful calcs necessary...

by way of example, I have recently had a person claim and receive CA for looking after her disabled son, whilst at the same time obtaining some £70-odd pounds from her aunt's DP budget (her aunt also employed her sister and brother in a package of DPs worth about £200 or so a week. As her husband worked full time in a well paid job, we didn't need to worry over any overlap of income with benefits. In these circs the client (who previously did all this for nothing was better off by some £120/week (DP+CA)....in addition we were able to retain Aunt's SDP, as no-one was "encouraged" to claim CA for her (this boosted by the fact that the 3 people who could have claimed CA all got DPs worth more than the measly CA rate)

for anyone new to Direct payments however it's worth being aware that unless there is a compelling reason to make an exception for the time being DIrect payments cannot be used to purchase payments from a direct payment recipient's

1. spouse or partner;
or anyone who is a:

2. a) parent/ parent in law
b) son or daughter
c) son in law or daughter in law
d) stepson or stepdaughter
e) brother or sister
f) aunt or uncle
g) grandparent

who is living 'in the same household' as the direct payment recipient. so please don't suggest all CA recipients try to get DP's!

So generally if a client's mother in law is living with them and needs care, social services are unlikely to approve payment of direct payments to your client, and so they could only claim CA (if they qualify for that). The only compelling reasons we have successfully argued are about language and culturally specific care for non english speaking somali clients (social services are unlikely to be able to come up with a viable alternative to a live in family member working as carer).

(different rules apply iof the direct payments are paid in respect of a parent of a child with disabilities)

Caroline

This scenario did not apply in the case I stated, as the Aunt lived alone (hence her retention of SDP). the carers all lived separately.This is not uncommon and can work in a number of cases.

Generally, I entirely agree with the terms of the above posting, but would point out that the system (of DPs) is relatively new to clients and Local Authority's alike, and basically untested (legally) in terms of the "exemptions" to the prescriptive approach (as listed above).

We here have argued successfully in a number of cases with varying circs...the most common being related to the cared-for's state of mental health, psychological and social/cultural needs....these being areas of need (amongst others) that are commonly left out of the community care assessment and care planning process...

it seems to me that most people would "prefer" a close and trusted carer (who may fall into the above list)...and often one who is/has been providing the right care for years sometimes....but of course an Authority's duty is not to meet "preferences", but "needs".

However, to convert a preference to a need in some cases can be a very close-run thing...a grey area... particularly where such issues as emotional, psychological and social/cultural needs are accounted. The example in the
above posting on language/culture etc shows the way.

The approach taken in R v Avon ex parte M defines the procedure and scope on assessing such areas of need.

In one case we had a husband was seen as the only carer avaialble for his wife with a history of paranoid schizophrenia. In another case (supported by the GP and Consultant) the nature of the physical illness was so intimate (as was the care received) that the Authority agreed to pay the son.
We seem to have had quite a few of these cases, and though we don't win em all, we seem to have been successful in a number of variations on the theme...maybe we just have more generous Local Authorities???

Basically, we should not advise that the payment is impossible, but we should not build up false hope....each case is very different, so a blanket/prescriptive approach is not quite right...clearly, the question of availability of alternative income (DPs) requires careful consideration on a number of levels (any carer could be better off/worse off), but - as the above posting states - not all will be able to access DPs in any event..a timely referral to a community care adviser may well be the way to resolve this dilemma.

...sorry...I meant to add that the case scenario which heads up this very thread seems to exemplify that the exception applies...perhaps in many more cases than are currently thought