CARE ACT 2014
The advice and information service of the local authority must include financial information and advice on matters relevant to care and support. Where it is not appropriate for a local authority to provide such information directly, it must ensure people are helped to understand how to access independent financial advice.
June 2018: Section 2, Providing Financial Information and Advice was amended to note that the cap on care costs introduced by the Care Act 2014, will no longer be implemented in 2020.
Financial information and advice is fundamental to enabling people to make well informed choices about how they pay for their care. It is central to a person’s understanding of how best to meet their care and support needs, now or in the future. Providing people with good and impartial financial information and advice should mean they have a better idea of how their resources can be used to fund a wide range of options.
This chapter should be read in conjunction with Information and Advice, in particular the sections on accessibility and proportionality, and must also be applied to financial information and advice.
‘Independent financial information and advice’ means services independent of the local authority. ‘Regulated’ financial advice means advice from an organisation regulated by the Financial Conduct Authority which can extend to individual recommendations about specific financial products.
2. Providing Financial Advice and Information
The advice and information service of the local authority must include financial information and advice on matters relevant to care and support. It should provide some of this information directly to people in its community. Where it would not be appropriate for a local authority to provide information directly, it must ensure people are helped to understand how to access independent financial advice.
Decisions about care and support are often made quickly and at a time of crisis and they can often involve family and friends. The local authority must consider the importance of identifying those who may benefit from financial advice or information as early as possible and how to raise awareness generally about how care and support is funded. It may also include how such costs relate to decisions about retirement.
Actions taken by the local authority should include:
- working with partners to get the right message to people in the local area, to those who develop care and support needs, their carers, families and friends;
- working with partners to communicate messages about the benefits of financial information and advice for example with the voluntary sector, through hospitals, GPs, or solicitors who may be advising on wills or power of attorney; and
- considering a person’s need for financial information and advice when they make first contact with the authority and throughout the assessment, care and support planning and review processes (see Access and Information, Assessment and Care and Support Planning).
When making financial plans about how to pay for care and support, a person needs to have confidence in what to do in the present, in the future and if circumstances change. This long term outlook means that people will want to access financial information and advice at different times to enable them to make plans to pay for their care.
The local authority should provide a service that covers immediate and long term financial planning, and provide access to the full spectrum of financial information and advice – from basic budgeting tips to regulated advice. They should also be aware and provide for the fact that some people will be less able to protect themselves from theft, fraud and financial exploitation (see Adult Safeguarding).
The local authority service should include the following aspects of financial information and advice:
- understanding care charges;
- ways to pay;
- money management;
- making informed financial decisions;
- facilitating access to independent financial information and advice.
Please note: The Government will no longer progress with a cap on care costs in 2020, delayed from 2016. A Green paper will be published in early 2019 regarding new legislation for social care reform.
3. Understanding Care Charges
The local authority must provide information to help people understand what they may have to pay, when and why and how it relates to their individual circumstances. This must include:
- the charging framework for care and support
- how contributions are calculated (from both assets and income) and the means tested support available;
- top-ups (see Charging and Financial Assessment);
- how care and support choices may affect costs.
In the case of top-ups, the local authority should ensure that someone is willing and able to pay for them; financial information will be fundamental in helping with this. The local authority should also use the knowledge it has of the local care market, including types of care and local providers of information and advice. This would include both domiciliary and residential care.
4. Ways to Pay
The local authority must provide people with information on the availability of different ways to pay for care including through
- income and assets (for example, pension or housing wealth);
- a Deferred Payment Agreement (see Deferred Payment Agreements);
- financial product or a combination of these things.
The local authority should seek to give information that is relevant to a person’s individual circumstances and ensure there is access to an independent source of information or advice where required. This will be particularly important where a person will be meeting the total cost of care and support themselves or may be considering taking out a Deferred Payment Agreement or purchasing a financial product.
5. Money Management
Different people will need different levels of support depending on their financial situation, their care needs and the amount they are expected to contribute.
At the lower end of the spectrum, people may need basic information and support to help them rebalance their finances in light of their changing circumstances. Topics may include welfare benefits, advice on good money management, help with basic budgeting and possibly on debt management. The local authority may be able to provide some of this information itself, for example of welfare benefits, but where it cannot, it should help people access it.
6. Making Informed Financial Decisions
The local authority must support people to make informed, affordable and sustainable financial decisions about their care throughout all stages of their life.
In many situations the role of the local authority will be to understand the circumstances of the person, understand their preferences and help them to access the information and advice that they need to make well informed decisions.
Where a person lacks capacity, the authority must establish whether a person has a deputy of the Court of Protection or a person with Lasting Power of Attorney acting on their behalf.
The local authority must offer to consider a person’s specific circumstances and provide them with information about the methods of paying for their care and support that may be available to them.
The local authority may consider the timing and context of any retirement decisions a person might be making and how this interacts with paying for their care and support. To help people access the information and advice they need, the local authority should:
- have a clear view of the information and advice services available locally and what they provide;
- take a role in joining up information and advice organisations locally so they can work collaboratively;
- help information and advice providers and people to understand the role of each information and advice provider so people can access the right provider at the right time and not be sent round in circles;
- provide and publicise links and information on access to wider sources of information and advice, including those available nationally.
Staff within the local authority and other frontline staff should be able to direct people to the financial information and advice they need, explaining the differences and potential benefits from seeking non-regulated or regulated financial advice.
7. Facilitating Access to Independent Financial Information and Advice
A key role for local authorities, when it would be inappropriate to provide it itself, is to facilitate access to financial information and advice which is impartial and independent of a local authority. This should include both generic free and fee-based advice, as well as services providing regulated forms of financial advice. This may include making people aware of specific sources of information and advice and giving information about how to use them. ‘Facilitating access’ may include making people aware of specific sources of information and advice that are available and giving information about how to use them. The local authority should make people aware which independent services may charge for the information and advice they provide. It should also be able to describe the general benefits of independent information and advice and explain the reasons why it may be beneficial for a person to take independent financial advice based on what is known of an individual’s circumstance, be able to explain the reasons why it may be beneficial for a person to take independent financial advice.
Where a person may be considering taking regulated financial advice, the local authority is not required or encouraged to make a direct referral to one individual independent financial adviser, but should actively help and direct a person to a choice of advisers regulated by the Financial Conduct Authority with the appropriate qualifications and accreditation. The local authority should ensure this is done on a transparent basis.