Direct Payments and Prepaid Cards Success for LEaP Project

23 April 2020

Sophie from our LEaP project looks back at one of her recent requests during which she looked specifically at direct payments and prepaid cards.

Direct Payments and Prepaid Cards Success for LEaP Project

23 April 2020

Sophie from our LEaP project looks back at one of her recent requests during which she looked specifically at direct payments and prepaid cards.

Letter writing

Sophie, our LEaP Project co-ordinator, explains how we helped families with disabled children in one particular English local authority. The request received was specifically in relation to direct payments and prepaid cards.

Details of the LEaP Request

In early 2020, our LEaP Project was contacted by Donna whose grandson has a diagnosis of autism and displays challenging behaviour. Donna is part of a local support group for parents and carers of children and young people with Special Educational Needs and Disabilities.

Donna explained that she and other families in her area who were in receipt of direct payments had received a letter from the local authority informing them that a new ‘Prepaid Card System’ had been introduced.

A direct payment is the amount of money that your local authority provides to enable you to personally arrange and pay for the social care support services that are necessary to meet your child’s eligible needs. Many people prefer to use direct payments (rather than having the services arranged for them by the local authority) as they can offer more flexibility and control over their child’s support package.

However, the ‘Prepaid Card System’ letter that Donna and other families received led them to understand that they had no other option than to accept that in future their direct payments would be paid via a Prepaid Card. The letter was also accompanied by a ‘Frequently Asked Questions’ sheet which included the following questions:

If I have a Direct Payment, do I have to have a prepaid card?
Yes, Staffordshire are introducing the use of prepaid cards for all Direct Payment clients.


Can I withdraw cash using the prepaid card?
No, you cannot withdraw money from cash machines, you should not be paying for any services using cash.

What does the law say in relation to direct payments and prepaid cards?

The Statutory Guidance to the Care Act 2014[1] states that:

“Whilst the use of such cards can be a useful step from managed services to direct payments, they should not be provided as the only option to take a direct payment. The offer of a ‘traditional’ direct payment paid into a bank account should always be available if this is what the person requests and this is appropriate to meet needs.”

The Guidance[2] also states that:

“where a pre-paid card system is used, the person is still free to exercise choice and control. For example, there should not be blanket restrictions on cash withdrawals from pre-paid cards which could limit choice and control.”

The letter and FAQ sheet, which had already been sent out to several families, directly contradicted the Statutory Guidance and was therefore unlawful.

What did the LEaP project do to help?

With support and advice from Professor Luke Clements at Leeds University, we wrote a letter to the local authority’s Monitoring Officer expressing our concerns regarding the letters. Not only did they directly contradict the Guidance, they also placed unreasonable restrictions on individuals’ rights to exercise choice and control over their direct payments.

We asked the Monitoring Officer to investigate our concerns as a matter of urgency and to carry out the following:

  • withdraw the letter and FAQ sheet;
  • send a letter of apology to every individual who had received the letter and FAQ sheet;
  • train all relevant staff to ensure that they understood that this policy was mistaken, had been revoked, and why it was contrary to the law.

What was the outcome?

The LEaP Project received a response from the Monitoring Officer within 10 days confirming that the letter and FAQ sheet had been withdrawn with immediate effect. A new FAQ sheet had been produced confirming that individuals were not obliged to have a prepaid card if they would prefer to continue using the traditional bank account method.

A letter of apology was also sent to all those who received the letter and FAQ sheet which included clarification of their rights. The Monitoring Officer also confirmed that training would be provided to all relevant staff via team meetings and via a separate email communication.

This was a great result for the LEaP Project and we are delighted that we were able to help so many families receive the service they are entitled to. Donna was very grateful for our support and passed on thanks from all the families in her area that would have been affected by this new system if the LEaP Project hadn’t intervened.

If you are experiencing a similar situation regarding direct payments in your local authority, please do get in touch with our LEaP Project via our online request form.

[1] At paragraph 12.59
[2] At paragraph 12.58

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