With the right approach councils can achieve better outcomes and reduced costs.
Author: Chris Watson
Councils are grappling with an ever-widening gap between rising social care demands and diminishing budgets. Faced with workforce shortages, escalating care costs, and increasing citizens dissatisfaction, local authorities must rethink how they deliver adult social care.
A robust Self-Directed Support (SDS) strategy, grounded in mechanisms like Direct Payments (DPs) and Individual Service funds (ISFs), offers councils a transformative opportunity to save money, improve efficiencies, and empower individuals.
This is not a theoretical exercise. Evidence from successful models across the UK demonstrates that councils adopting self-directed support strategies can achieve better outcomes while reducing costs. Yet, many councils remain wedded to outdate approaches that are inefficient, expensive and inflexible. The time for change is now.
Local authorities face escalating care demands from an ageing population, more people living with complex needs, and increasing calls for personalised, high-quality services. According to the Local Government Association (LGA), adult social care funding in England faces a £3.7 billion shortfall by 2025. Simultaneously, block contracts and traditional commissioning models are proving increasingly unsustainable. These approaches often lock councils into rigid frameworks that limit flexibility, drive up costs, and fail to deliver the personalisation mandated by the Care Act 2014.
Self-directed support offers a practical alternative. By giving individuals control over their care, SDS reduces administrative burdens, stimulates local markets, and enables preventative approaches that avoid high-cost crisis interventions. However, adoption has been inconsistent, with councils citing perceived risks, administrative complexity, and workforce challenges as barriers.
Traditional council-managed care involves significant overheads for procurement, contract management, and quality assurance. In contrast, SDS shifts responsibility for these functions to individuals or their representatives, reducing administrative costs for local authorities. Evidence from the Social Care Institute for Excellence (SCIE) highlights that individuals managing their own care through DPs often achieve better value for money by negotiating directly with providers and personal assistants (PAs).
DPs enable citizens to employ PAs or access small-scale, community-based services that are often significantly cheaper than large agency contracts. For example reserach by Think Local Act Personl (TLAP) found that employing PAs through DPs costs 20-30% less than agency staff while offering higher citizen satisfaction. Furthermore, fostering local micro-enterprises, as seen in Somerset and Derbyshire has created vibrant care markets that deliver tailored, cost-effective support.
Preventative care is critical to reducing long-term costs. DPs allow individuals to invest in activities and technologies that enhance independence and well-being, delaying or avoiding costly interventions such as hospital admissions or residential care. A study from the Department of Health on Individual Budgets found that citizens directing their own care were more likely to access preventative services, reducing overall care costs.
Despite the clear benefits, SDS uptake remains limited due to the following barriers:
A comprehensive SDS strategy must go beyond tokenistic efforts. It requires councils to embed self-directed support as the default approach to delivering care. Key components include:
Somerset’s investment in micro-enterprises has reduced care costs by 30% for DP users compared to traditional services. This apporach has also boosted the local economy, creating jobs and fostering community resilience.
Derbyshire has successfully integrated ISFs alongside DPs, offering a flexible alternative for citizens who prefer less hands-on management. This has increased uptake among older adults, reducing reliance on constly commissioned services.
Think Local Act Personal found that employing PAs through DPs saved councils 20-30% compared to agency contracts. Citizens reported higher satisfaction levels and better continuity of care, reducing the need for crisis interventions.
The Social Care Institute for Excelllence highlights that DPs enable personalised, preventative care, which reduces hospital admissions and dleays transitions into residential care - saving councils up to £30,000 per person annually.
Failing to adopt a self-directed support strategy has significant consequences:
Self-Directed Support is not just a policy option; it is a necessity for councils striving to meet growing care demands within contrained budgets. By adopting a clear SDS strategy, councils can achieve significant savings, improved efficiencies, and deliver better outcomes for individuals.
The evidence is clear: self-directed support works. It reduces costs, empowers citizens, and aligns with the principles of the Care Act. Councils that act now to embrace SDS will not only transform their financial position but also pave the way for a more sustainable and person-centred social care system.
The publisher is Citizen Network. Developing a Self-Directed Support Strategy © Chris Watson 2025.
disability, Individual Service Funds, Self-Directed Support, social care, England, Article
