Children's Prepaid Card Consultation

Closed 28 Feb 2021

Opened 1 Feb 2021



The Community Care (Direct Payment) Act 1996 gave local authorities in England, Wales and Northern Ireland the power to make Direct Payments. The Carers and Disabled Children Act 2000 extended this to include carers, parents of disabled children and disabled young people.

The Carers and Disabled Children Act 2000 provided councils with the duty to offer Direct Payments to parents of disabled children and disabled young people, who have been assessed as being in need of services.

Where the disabled young person is aged over 16, they may pursue Direct Payments in their own right, and parent/carers will be encouraged to support such arrangements.

In relation to the legal guidance, the Council has a number of duties:

  • to assess and review the needs of the child and carers
  • to ensure arrangements are safe and promote the welfare of the child
  • to ensure only appropriate people are employed to work with children and young people
  • to support parents, in consideration with the child, in relation to their wishes regarding intimate care, and potential at 16 and 17 to manage their own support (albeit with parental support too!).

What are Direct Payments?

Direct Payments are payments that are made by the Council to the parent or carer of a disabled child or to a disabled young person up to 18 years of age.   Direct Payments must be used solely for meeting the needs that have been identified by Social Care Services.

In the first instance, Social Care Services will assess your child’s needs, so that Direct Payments can be provided to put in place the help that is required.   Direct Payments allow you to employ your own staff to provide care and support for your child or young person, instead of receiving assistance arranged by the Council.  The Local Authority will require all carers to be DBS checked prior to starting work.  However, there is no obligation for parents to take this offer up, and parents are entitled to have services arranged on their behalf.

You can continue to have some services arranged by social care services whilst you arrange only part of your support package for your child. Therefore, you only have to arrange the aspects of the care that you feel able to manage.

Provision of Prepaid Card

The council’s new policy is to use a prepaid card account as its primary method to make Direct Payments.

Prepaid cards can be a great way of increasing flexibility and reducing the barriers to personal budgets and the aim of the prepaid card scheme is to promote independence by providing parents and young persons with the right tools to manage their own support. Prepaid cards will provide the necessary flexibility to give people choice and control over the delivery and payment of the social care services and support identified in their support plan.

The vision for the prepaid card service is to:

  • ensure the best customer journey for families
  • maximise the independence of families
  • enable as many people as possible to manage arranging and paying for their own support
  • optimise choice and control over how, when and where people spend their direct payment
  • reduce bureaucracy
  • reduce fraud

The prepaid card system is a chip and pin card and an alternative to a bank account.  Payments can be made for support/activities over the internet/phone using the card details.

The prepaid card is to be used by the parent/carer/young person solely for receiving direct payments and to pay for their support services in accordance with the terms of the direct payment agreement.

The parent/carer/young person is responsible for managing the prepaid card account and should not allow the prepaid card to be used by any person not authorised under the direct payment agreement, or any person not named on the prepaid card.

Luton Council will pay the direct payment into a prepaid card account every four weeks.  This will cover payments for assessed care needs two weeks in arrears, two weeks in advance. 

The prepaid card is really easy to use, just like a normal debit card:

  • it has an account number and sort code
  • there is no cheque book or overdraft facility so you can’t spend over your budget and get into debt
  • there are no fees or charges to use the card
  • it’s easy to use and manage a Direct Payment

Over 120 councils in the UK are already using prepaid cards to deliver direct payments.  They are now a well-established method of paying and administering direct payments.  There are benefits for both Luton Council, and service users. 

Benefits of a prepaid card

We believe parents/carers/young persons receiving a direct payment from the council will benefit from using a prepaid card because it will:  

  • reduce delays
  • reduce paperwork submitted to the council’s finance officer
  • enable you to directly pay providers (personal assistant, care agency or organisation) for the support received, in line with assessed and agreed care needs
  • enhance direct control and independence to manage your own support
  • improve choice and flexibility over how, when and where you spend your personal budget, in line with assessed and agreed care needs
  • provide you with access to how much personal budget you have in your account, allowing you to manage the budget better

However, all accounts will be audited and you should use the online portal to evidence transactions on your prepaid card, by uploading photos or scanned copies of invoices, receipts and other payments.

Features of a prepaid card

  1. Payment can be made from a prepaid card by bank transfer, direct debit, standing order by telephone or online banking
  2. You can access the account at any time via the online portal or by telephone
  3. You can easily top-up the account for additional care needs, or differences in rates/fees
  4. You have full visibility of the account to support management of the direct payment
  5. The account is safe and secure

Things the prepaid card cannot do or be used for:

  • go overdrawn or get into debt by using the prepaid card
  • used for things that are not covered in your care plan

Please see the Luton prepaid card frequently asked questions  in the ‘related documents’ section below for more details on what the prepaid card cannot be used for

How do I get a prepaid card?

We will assess your child’s care needs and your suitability to have a prepaid card.  On establishing your suitability, we will send you a new direct payment contract to sign.  You may be required to provide some forms of ID before your card is issued by post.

What do I need to do when I receive a prepaid card?

The very first thing you will need to do on receiving your card is to activate it.  This is an easy process which can be completed over the phone, with assistance from the card issuer Prepaid Financial Services.

For more information about our prepaid card, please see Luton prepaid care frequently asked questions in the 'related documents' section below.

Why we are consulting

Between now and the end of March 2021, Luton Council will be using prepaid card accounts to deliver direct payments as a default option.   If you currently receive direct payments via a holding account that is managed by the Disability Resource Centre (DRC), please note that this will no longer be an option for you from April 2021 through the Council.  Instead, you may receive your child’s direct payment funding via a prepaid card, if this is considered appropriate.  If not, the Council will advise you of alternative options available to you. 

To help you understand more about prepaid card, you can find published case studies, which show how other councils and users are benefitting greatly from the introduction of prepaid cards on the National Prepaid Card Network website.

We would like to hear your views?

We would like to hear any feedback on the proposals. All the information you provide will be considered and used to make sure the service is the best it can be.

We aim is to give you as much opportunity as possible to provide your views.  With this mind, you may do so in the following ways:

You can do this through:

  • completing an online or paper questionnaire
  • attending a consultation event via Zoom on any of the following dates:-
    • 16 February 2021               14:00-15:00
    • 17 February 2021               10:00-11:00     



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  • Parents
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  • Looked after children
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  • Children and families