Consultation on proposed regulations for direct payments in health and social care

This consultation seeks views on Welsh Government’s proposals for implementing direct payments for health care, specifically for those in receipt of Continuing NHS Healthcare (CHC). It also seeks views on changes in the way social care direct payments will be administered, to permit the making of direct payments to a nominee of a recipient who has mental capacity.

Part 1 of the consultation asks about:

• views on proposed amendments to the Local Health Boards (Directed Functions) (Wales) Regulations 2009 which will delegate functions to local health boards to make direct payments on behalf of Welsh Ministers

The responses received on this question will inform the way amendments to the regulations governing directed functions will be drafted in respect of this proposal.

Part 2 of the consultation asks about:

• views on proposed content of regulations for direct payments for health care
• views on how guidance can complement and add to regulations for those operating or in receipt of direct payments for health care

The responses received on these questions will inform the way regulations will be drafted that will enable local health boards to make direct payments for health care, specifically for individuals who are eligible for CHC, and with a particular focus in the first instance, on adults in receipt of CHC.

A direct payment for CHC means individuals would receive money to arrange and pay for some or all of their own health and care services to meet their assessed needs.

Part 3 of the consultation asks about:

• views on proposed amendments to the regulations (and relevant code of practice, as necessary) governing direct payments in social care in respect of a nominated third party being able to administer the payments on behalf of a recipient

The responses received on this question will inform the way amendments to the regulations governing direct payments in social care will be drafted in respect of this proposal, and any amendments to the relevant code of practice which may be required.

Currently in Wales, direct payments are paid to individuals, or, in appropriate cases, their representative, to enable them to secure services of their own choosing to meet their eligible needs for care. To date they have only been available to those in receipt of social care via local authorities and have not been an option for those in receipt of CHC. This is unlike the case in England.

Over a number of years, stakeholders have raised concerns around the interface between CHC and direct payments in Wales, and the compromise of people’s voice and control when transferring from social care services which a local authority has responsibility to arrange or deliver, with direct payments, to CHC, where that option is lost.

As a first step in addressing this situation, and until legislation was brought forward to allow direct payments for health care in Wales, the revised ‘Continuing NHS Healthcare National Framework for implementation in Wales’ contains an increased emphasis on enhancing voice and control for individuals in receipt of a package of care provided through CHC. The CHC National Framework was published in July 2021 and operational as of April 2022.

On 24 March 2025, the Health and Social Care (Wales) Act 2025 (‘the 2025 act’) became law in Wales. Through it, the NHS (Wales) Act 2006 (‘the 2006 act’) now includes provisions to enable the introduction of direct payments for health care in Wales. Specifically, the act amends the National Health Service (Wales) Act 2006 to allow the Welsh Ministers to make direct payments to individuals, enabling them to secure services to meet their assessed needs for health care in lieu of receiving services provided or commissioned by the NHS in Wales.

This change supports the Welsh Government’s commitment to give individuals receiving CHC more choice and control over their care, and in particular the Programme for Government commitment to ‘improve the interface between Continuing NHS Healthcare (CHC) and Direct Payments’.

Amendments to the NHS (Wales) Act 2006 made by the 2025 act include: 

• a power for the Welsh Ministers to make direct payments to adults (or their representative) who would otherwise be entitled to directly provided or commissioned NHS care
• a power for the Welsh Ministers to make regulations about direct payments
• where the Welsh Ministers exercise their powers to make direct payments, they may make arrangements with any person or body to provide assistance in connection with direct payments

Our approach to direct payments for health care will initially focus on adults receiving CHC in their own homes, as this is where stakeholder feedback has indicated the most demand for increased voice and control exists currently.

The introduction of direct payments for health care is intended to address the issues raised around the loss of independence and voice and control that individuals experience when transferring from social care to CHC. It is anticipated that this will support improved fairness and equality for disabled and seriously ill people, whether receiving care from the local authority or the health board, and support the principles of person-centred care.

The option for an individual to receive direct payments for CHC means that they will get support that is more focused on their understanding of themselves and their needs. This is in line with the core principles of the United Nations Convention on the Rights of Disabled People (UNCRDP).

It is important to note that the core principles and values of the NHS in Wales remain unchanged. Whether or not an individual has a direct payment to meet their health care needs, health care will always be free at the point of delivery, based on need and not the ability to pay. Top-up payments will not be permissible within health care.

To enable direct payments for CHC, regulations under powers in the new provision in part 1 of the 2006 act and guidance needs to be in place. We will develop regulations and guidance to outline how local health boards will manage and deliver direct payments on behalf of Welsh Ministers (the proposals contained in this consultation), alongside amending the Local Health Boards (Directed Functions) (Wales) Regulations 2009 in order to effect the delegation of these functions. Part 1 of this consultation asks for views on this proposal.

Responses captured as part of this consultation will help to inform development of the regulations and the guidance that supports it. The regulations will form part of a package of secondary legislation and guidance that will enable the making of direct payments for health care. Whilst initial guidance will be created, it will be updated and revised over time as there will be much to learn about the operation of direct payments as the new systems develop.

Direct payments have been permissible for CHC, via Personal Health Budgets (PHBs), since 2014 in England enabling the testing and embedding of the approach over several years. For this reason, it is our intention that our approach with regards to the regulations for direct payments for health care in Wales will largely mirror, where appropriate, those in force in England. 

In order to reflect the Welsh health and care context there is also a need for alignment, where appropriate, to the social care direct payment regulations in Wales. Alignment to this set of regulations would provide for as seamless a transition as possible between the health and social care direct payments systems.

We value the opportunity to receive feedback on whether the proposed approach as outlined above and the content of the proposed regulations will meet these aims, and how guidance can further support the operation of health care direct payments in Wales.

This consultation seeks your views on the policy intent for the subordinate legislation required to set out how direct payments for health care should operate. The document largely follows the structure of the regulations which are applicable in England, The National Health Service (Direct Payments) Regulations 2013 in line with our outlined approach. It sets out the proposed content of the regulations which will set out how direct payments for health care would operate. 

At the end of the document there is a set of questions seeking your views.

The Health and Social Care (Wales) Act 2025 provides the Welsh Ministers with powers to make direct payments for health care. However, these powers would be delegated to local health boards (as described above). The description of the proposed content of the regulations refers to the administering of direct payments by local health boards given that they will be responsible for the exercise of the functions prescribed by the regulations. It should be noted that the local arrangements and structures will impact on the division of responsibilities, and therefore this has not been specified within the proposed content of the regulations.

As noted above, to enable direct payments for CHC, regulations under powers in the new provision in part 1 of the 2006 act and guidance need to be in place. Alongside development of regulations and guidance to outline how local health boards will manage and deliver direct payments on behalf of Welsh Ministers (the proposals contained in part 2 of this consultation), amendments are required to the Local Health Boards (Directed Functions) (Wales) Regulations 2009 in order to effect the delegation of these functions. 

We ask for your views on this section of the consultation at question 1.

Persons to whom direct payments may be made

It is proposed that a direct payment may be made by a local health board to, or in respect of, a person eligible for National Health Service (NHS) care. We further propose that regulations specify that the person must be an adult and consent to the making of direct payments to them, subject to any provision made in respect of a person who lacks capacity or is a child. (The provisions relating to children would be a future-proofing measure).

Matters a local health board must have regard to when making a decision concerning direct payments

Within the regulations we further propose that a local health board will be required to have regard to the following matters when determining whether a direct payment should be made:

• whether such payments would be appropriate for the person having regard to their circumstances and whether their health condition or conditions are suitable to be part of a package to be funded by direct payments, (for example, the condition is stable, care can be delegated and so on)
• the impact of that condition on the person’s life
• whether a direct payment represents value for money
• the extent to which the direct payment would promote the person’s voice, choice, and control
• the importance of continuity and familiarity in care arrangements

Direct payments in respect of children

We propose to include provisions in relation to the making of direct payments in respect of a child. It is not the intention in Wales to focus initially on children with respect to direct payments for CHC, but as this is not precluded by the act. The aim of the regulations would be to enable the making of direct payments in respect of the health element of Children and Young People’s Continuing Care, where that person is eligible for NHS care, and have a representative who consents to receiving direct payments on their behalf, or in appropriate circumstances, the young person is able to give valid consent themself.

Direct payments in respect of persons who lack capacity

We propose that regulations would set out requirements with regard to the making of direct payments in respect of persons who lack capacity, where that person has a representative who consents to act as a ‘suitable person’ and to receiving direct payments on their behalf. 

In such cases, a local health board would also be required to have regard to the general matters stated above regarding suitability for a direct payment, when deciding whether a direct payment should be made.

Persons in respect of whom there is no representative

We propose that in cases where there is no representative for a person who lacks capacity, a local health board may appoint a person it considers to be appropriate to receive and manage the direct payment on the person’s behalf.

Representatives for children and persons who lack capacity to consent to the making of direct payments

It is proposed that several requirements would have to be complied with by a representative or suitable person in order for a direct payment to be made to them on behalf of another person. As well as agreeing to act on behalf of the person, they would need to:

• act in the person’s best interests with regard to the direct payment and when securing the provision of services that the direct payment is being made for
• be responsible for all contractual arrangements entered into for the person’s benefit and secured by means of the direct payment
• use the direct payment in accordance with the care and support plan

Loss of capacity or fluctuating capacity following agreement to the making of direct payments

We also propose to include requirements to be complied with where a person receiving direct payments no longer has the capacity to consent, or it is believed by the local health boards that they no longer have capacity to consent. We propose that a local health boards may continue to make direct payments where: 

• it is satisfied that the lack of capacity is likely to temporary
• a representative or suitable person agrees to receive direct payments on the persons behalf
• the direct payments are made subject to the condition that the person must be allowed to manage the direct payment for any period in which the local health board is satisfied that the person has the capacity to consent to the making of the payments and they are also able to manage them

We propose that in a case where a person without capacity gains or regains capacity, a local health board may continue to make the payments to a designated representative or nominee in accordance with the care and support plan should the person and their representative or nominee consent.

Nominated person who can receive a direct payment on behalf of a direct payment recipient with capacity

We intend that the regulations will set out the provisions under which a direct payment recipient with capacity may nominate another person to receive and manage direct payments on their behalf. The regulations would outline the conditions to be met, including the requirement for the nominee’s consent and the local health board’s approval. We propose that the regulations should also address the withdrawal of nominations and the implications for ongoing payments.

We consider that the regulations should contain requirements that must be complied with by a nominee in order for a direct payment to be made to them on a direct payment recipient’s behalf. The proposed requirements include: 

• the nominee must agree to receiving the direct payment and the local health board must agree to the making of the direct payments to the nominee
• the need to be responsible for all contractual arrangements entered into for the benefit of the person and secured by means of the direct payment
• using the direct payment in accordance with the care and support plan
• complying with all relevant provisions within the regulations

Where the nominating person notifies the local health board, in writing, that they wish to withdraw or change their nomination, it is proposed that the local health board must consider whether to stop making the payments and as soon as reasonably possible review the making of direct payments.

We ask for your views on this section of the consultation at question 2.

Decision to make a direct payment

We propose that regulations will set out requirements in relation to a local health board deciding whether to make direct payments to a person, their representative or nominee. The primary aim of this proposal is to ensure that local health boardss undertake appropriate consultation and assessment before deciding to make direct payments, taking into account the person’s needs, preferences, and circumstances.

Before making a decision as to whether a direct payment should be made, we propose to provide that a local health board may consult the following persons:

• the direct payment recipient and anyone identified by the
• if the person is a child, a person with parental responsibility for them
• a primary care provider and any other person who provides care for the person
• any health care professional, other professional person or advocate who provides health services to the person
• any local authority social care team who has had or retains responsibility for ensuring that the person’s social care needs are met
• any other person who appears to a local health boards to be able to provide information of relevance

We propose that regulations will also set out the information that a person may be required to provide to the local health board to support decision making including information related to their state of health or any condition in respect of which the direct payment is being considered and any bank account into which a direct payment may be made. 

We consider that there should be a requirement for a local health board to be satisfied that the person would be capable of managing the direct payment by themselves or with appropriate assistance made available to them.

Decision to make a direct payment to a representative

We further propose that before making a decision as to whether a direct payment will be made to the representative of a person who lacks capacity, a local health board may consult:

• any deputy appointed in respect of the person by the Court of Protection under the Mental Capacity Act 2005 who has the legal authority to make decisions on behalf of the person in relation to matters for which the direct payments may be made
• a lasting power of attorney under the Mental Capacity Act 2005 in respect of the direct payment recipient
• persons named by the person, when they had capacity, to be consulted

We also propose that the regulations provide that a local health board may consider the following matters:

• whether the direct payment recipient has previously, when they had capacity, expressed a wish for a direct payment, in writing or other understandable means
• so far as reasonably ascertainable, their beliefs, values, wishes and feelings

Decision to make direct payments to a nominee

In respect of the provisions under which a direct payment recipient who has capacity may nominate another person to receive and manage direct payments on their behalf, we propose a number of requirements that must be adhered to by the local health boards, including: 

• where a nominee would be a person, requiring them to apply for an enhanced criminal record certificate including suitability information relating to vulnerable adults - unless the nominee lives in the same household as the direct payment recipient, is a family member or a friend involved in their care
• where the nominee would be a corporate body or an unincorporated body of persons, require the person whom the body nominates to hold overall responsibility for the day-to-day management of the direct payments to apply for an enhanced criminal record certificate including suitability information relating to vulnerable adults

For the purposes of the regulations, we propose that family members are identified as:

• the spouse or civil partner of the direct payment recipient
• a person who lives with the direct payment recipient as if their spouse or civil partner
• a person who is the person:
  • parent
  • parent-in-law
  • step-parent
  • son or daughter
  • son-in-law or daughter-in law
  • stepson or stepdaughter
  • brother or sister
  • aunt or uncle
  • grandparent
• the spouse or civil partner of any person specified above or persons who live with them as if their spouse or civil partner.

Ability to manage a direct payment

It is proposed that regulations set out that in deciding whether a person, representative or nominee is capable of managing a direct payment, a local health board may, in particular, consider whether:

• they have not been able to manage a direct payment or a direct payment to secure relevant services for social care under the Care and Support (Direct Payments) (Wales) Regulations 2015
• they are capable of taking all reasonable steps to prevent the fraudulent use of the direct payment

Rights to be informed

We propose that regulations will further outline the right of the person, their representative or nominee to be informed by the local health board, in writing, of the decision and if relevant the reasons it has been decided not to offer a direct payment. 

We ask for your views on this section of the consultation at question 3.

Care and support plan and care co-ordinator

Within the regulations we propose to include requirements with regards to the preparation of a care and support plan and actions to be undertaken by a local health board before a direct payment may be made to a person, their representative or nominee. 

We also propose that the regulations should outline the role and responsibilities of a care co-coordinator and those services that must not be secured by means of a direct payment. The primary aim of this would be to outline the process for making decisions about direct payments, including the criteria and considerations that must guide the local health board’s determination.

Preparation of a care and support plan

We propose that a local health board must prepare a care and support plan in respect of the services to be secured by direct payments and associated requirements.

Under the proposed approach, the following must be set out by a local health board within a care and support plan:

• any health needs to be met by direct payments
• health outcomes to be achieved through the provision of the direct payments
• services to be secured by means of the direct payments
• the amount of direct payment and intervals at which payments are to be made
• the name of the care co-ordinator
• who is responsible for monitoring each health condition of the person in respect of which direct payments may be made
• the anticipated date of first review in line with requirements determined in this set of regulations and how this may be carried out
• period of notice to apply if, following a review, a local health board decides to reduce the amount of or cease making the direct payments

Care co-ordinator

We propose that the regulations would require a local health board to nominate a care co-ordinator, with the proposed responsibilities of such a role including:
 

• managing the assessment of the health needs for the care and support plan
• ensuring the person or their representative has agreed any matters listed as requiring their agreement
• the monitoring or arranging the monitoring of the making of direct payments and the health conditions in respect of which the direct payments are made
• arranging reviews of the direct payments
• liaising between the person, their representative or nominee and the local health board in relation to the direct payments

Consideration of risk and risk management

We propose that regulations will also outline a requirement for the local health board have regard to any significant potential risks that have been identified as having the potential to arise in connection with the making of direct payments in respect of the recipient. 

We further propose that any consequences of those risks and any proportionate means of mitigating them should also be considered. Any risk management procedures must be agreed with the direct payment recipient, representative or nominee and subsequently be incorporated into the care and support plan.

The following areas of risk are outlined that could be considered: 

• risk to the direct payment recipient’s health
• medical or surgical risk arising from the procurement of a particular services
• risk from an employment relationship where direct payments are used to secure services from an employee
• risk from a provider of services operating under an inadequate procedure, policy or the lack thereof for the investigation of complaints or under inadequate or no insurance or indemnity cover for the services to be provided
• risk of monies paid by way of a direct payment going missing, being misused or being subject to fraud

We also propose that the local health board in consultation with the direct payment recipient or their representative, must be satisfied that those services identified in the care and support plan can meet the health needs to be met by direct payments. Moreover, that the amount of direct payment would be sufficient to meet the full costs of those identified services.

Excluded services

We also propose that the following services may not be secured by means of a direct payment and therefore cannot be included in a care and support plan:

• primary medical services and GP services as defined in the 2006 act
• NHS charges including dental or sight tests
• planned surgical procedures
• providing vaccination, immunisation or screening, including population wide immunisation programmes
• health care provided under the National Child Measurement Programme
• care provided as part of an NHS Health Check
• payment for gambling, alcohol, tobacco or repaying debts otherwise than in respect of a service specified in the care and support plan

In consequence, we also propose that the direct payment recipient, or their representative or nominee can request that the local health board inform them of the reasons for a decision not to include a particular service to be secured by direct payments within the care and support plan. Where such a request is received, we propose that the regulations stipulate that the local health board must comply with that request.

One-off direct payments

We propose that a “one-off direct payment” could be possible if they are included in the care and support plan, and that these would be defined as a payment made:

• for a single item or service
• as a single payment for no more than five items or services, where that payment is the only payment a person will receive from the local health boards within a single financial year

We ask for your views on this section of the consultation at question 4.

Information, advice and other support

We propose to include in regulations a requirement that a local health board must ensure the provision of information, advice or other support to a direct payment recipient, representative or nominee in connection with the making of direct payments. Such provision would set out what an arrangement by a local health board for the provision of information, advice or other support could include.

We propose that the following information, advice or other support could be included:

• specifying the amount of direct payment and how this is calculated
• advising of matters to include:
  • the availability of direct payments as an option for those in receipt of CHC
  • the process to request a direct payment
  • the process to develop and agree the care and support plan, including identifying risks and mitigation plans
  • the budget or indicative budget and any restrictions on spend
  • the process for managing the direct payment
  • how to request a review of the direct payment and care and support plan
  • circumstances where a person may no longer qualify for a direct payment
• provision for employment related services to assist where a direct payment recipient employs a personal assistant
• provision of assistance with the training of personal assistants and as relevant with the commissioning of services
• where a person is transferring form social care to health care direct payments, arrangements between a local health board and a local authority for joint working and co-operation
• support for networking and exchange of information by those delivering or receiving direct payments

Further to the above, if a care and support plan specifies a requirement for information, advice or other support, we intend that this could be a service that the direct payment could be made for. 

We ask for your views on this section of the consultation at question 5.

Conditions to be complied with by those in receipt of direct payments

We propose that the regulations should set out the conditions that must be met by a direct payment recipient, representative, or nominee in relation to the use of direct payments, in order to ensure that public funds are used appropriately, transparently, and in line with the care and support plan, while safeguarding the quality and safety of services procured.

Use of direct payments

Under the proposals, a direct payment recipient, representative, or nominee must:

• use the direct payments solely for the purpose of securing services as specified in the care and support plan
• ensure that the direct payments are used in accordance with the care and support plan, in particular to secure the provision of the full range of services identified therein

We further propose that a local health board may impose additional conditions on a direct payment recipient, representative, or nominee, including a restriction on securing services from a specified provider.

Monitoring, oversight and provision of information

We propose that a direct payment recipient, their representative, or nominee must, upon request or at intervals specified by a local health board, provide information or evidence relating to:

• the health condition or conditions or general state of health in respect of which the direct payment is made
• the health outcomes expected from the provision of services
• further information considered necessary by the local health board

Where the person’s health or other relevant circumstances change substantially, they, their representative or nominee must notify the local health board of such changes.

Due diligence in securing services

We propose that, if any services are secured from a provider other than a personal assistant, a direct payment recipient, their representative, or nominee must make reasonable enquiries to ascertain that the provider has complied with any professional registration requirements and has insurance or indemnity cover proportionate to the risks associated with the services provided to the direct payment recipient. 

Where a direct payment recipient, representative, or nominee requests that a local health board assists with undertaking the enquiries outlined above, the local health board must do so in respect of the specified provider.

Conditions relating to bank accounts

Where a local health board has determined to make direct payments to or in respect of a person, we propose that such payments must only be made into an account approved by the local health board, provided the below conditions are met.

The account must be:

• capable of holding monies solely for the purpose of securing services by means of the direct payment
• capable of being audited by the local health board or any person authorised by them by reference to statements detailing the source of all monies deposited and the destination of all monies withdrawn, so as to enable effective monitoring and review of the use of direct payments
• accessible only by persons named and approved by the local health board and be used exclusively for holding monies paid by way of the direct payments unless in the case of a one-off payment, as referred to above

We also propose that regulations will further outline that a local health board may request at specified intervals, information or evidence relating to the approved account into which direct payments are made, or the services secured through the use of direct payments, so as to ensure that the payments are used solely for the provision of services as set out in the person’s care and support plan.

We ask for your views on this section of the consultation at question 6.

Amount, monitoring and review of direct payment

We propose that regulations will set out the requirements for determining and adjusting the amount of direct payments made by a local health board to or in respect of a direct payment recipient, ensuring that such payments remain sufficient to meet the cost of services specified in the care and support plan. The primary aim is to ensure that the financial support provided through direct payments is adequate, responsive to changes in needs, and aligned with the services outlined in the care and support plan.

Determination of amount

We propose that a local health board must ensure that the amount of any direct payment made to or in respect of a direct payment recipient is sufficient to cover the full cost of each service specified in the care and support plan.

Change in health condition

Where a local health board is notified, or otherwise becomes aware, that the direct payment recipient’s state of health has changed significantly, but considers that a formal review is not required, we propose that a local health board must nonetheless be satisfied that the amount of the direct payments remains sufficient.

Offsetting unused funds

Additionally, we propose that a local health board may reduce the amount of direct payments due in respect of a particular period by an amount not exceeding the value of unused payments previously made, where: 

• direct payments have been accumulated and remain unused
• the local health board considers it reasonable to offset the accumulated funds against the outstanding amount due for that period

Adjustment of payment amount & notice of reduction

We propose to make provision in the regulations to specify that a local health board may, at any time, increase or reduce the amount of the direct payments, provided it is satisfied that the revised amount remains sufficient to meet the full cost of the services specified in the care and support plan. We also propose that where a local health board decides to reduce the amount of direct payments, it should be required to provide reasonable notice in writing to the direct payment recipient, representative, or nominee, setting out the reasons for the decision.

Monitoring and review of direct payments

We propose that regulations should set out the duties of a local health board in relation to the ongoing monitoring and periodic review of direct payments they have made, including the circumstances in which a review must or may be undertaken, and the actions that may follow such a review. The primary aim is to ensure that direct payments continue to meet the direct payment recipient’s health needs effectively, are used appropriately, and remain aligned with the care and support plan through regular oversight and timely intervention.

We propose that a local health board must monitor: 

• the making of direct payments to or in respect of a direct payment recipient
• the health conditions in respect of which the direct payments are made

We also propose that a local health board must review the making of direct payments:

• at appropriate intervals
• at least once within the first 3 months of the commencement of direct payments
• thereafter, at intervals not exceeding 12 months

Where a local health board is notified, or otherwise becomes aware, that the direct payment recipient’s state of health has changed significantly, or where it becomes apparent that the direct payments have not been sufficient to secure the services specified in the care and support plan, we propose that the local health board must carry out a review.

We propose that, when conducting a review, under the regulations a local health board will be required to:

• review the care and support plan to determine whether it continues to meet the persons health needs
• assess whether the direct payments have been used effectively
• consider whether the amount of the direct payments remains sufficient to cover the full cost of the services specified in the care and support plan
• determine whether the direct payment recipient, representative, or nominee has complied with their obligations as set out above

We further propose that in the course of a review, a local health board may:

• re-assess the direct payment recipient’s health needs in relation to services to be secured by direct payments
• consult any of the persons previously referred to
• assess whether the direct payments have been effectively managed, to include, if necessary, examining receipts, bank statements, or other relevant financial records

Review at the request of the person, representative or nominee

We propose that regulations require that where a direct payment recipient, representative, or nominee requests a review, the local health board must determine whether to carry out a review, taking into account local practices and circumstances; and undertake it in accordance with any relevant regulations and guidance.

Actions following a review

Following a review, we propose that the regulations provide that a local health board may, having regard to the care and support plan and any consultations or enquiries:

• amend the care and support plan
• substitute a representative or nominee as the recipient of the direct payments
• increase, maintain, or reduce the amount of the direct payments
• impose conditions on the direct payment recipient, representative, or nominee, including:
  • a restriction on securing services from a specified provider
  • a requirement to provide additional information not previously required
  • take any other action it considers appropriate

Notice of reduction or cessation

We further propose that where a local health board decides to reduce or cease direct payments following a review, it must provide reasonable written notice to the direct payment recipient and any representative or nominee, stating the reasons for the decision.

Further review upon request

Upon receipt of such notice, we propose that the direct payment recipient, representative, or nominee may request a further review and may submit additional evidence or information for consideration. 

A local health board must provide written notice of the outcome of any further review, including the reasons for its decision. 

Finally, we propose that regulations outline that a local health board is not required to undertake more than one further review following a decision to reduce or cease direct payments.

Suspension

We propose that regulations will set out the circumstances under which a local health board may temporarily suspend direct payments, pending review or investigation. The primary aim is to provide a mechanism for pausing payments where there is uncertainty about eligibility, misuse of funds, or a need to reassess the direct payment recipient’s care and support plan or capacity, without immediately terminating the arrangement.

We also propose that any information provided to a local health board must be:

• legible
• accompanied by the relevant authorisation enabling the taking of copies or making of extracts where appropriate
• if so requested, be accompanied by an explanation by the information provider of anything which has been provided, or a statement to the best of their knowledge and belief including as to where information or evidence that the person has failed to provide is held

We ask for your views on this section of the consultation at question 7.

Repayment, recovery and cessation of direct payments

We propose that the regulations will deal with the circumstances under which a local health board may require the repayment of direct payments or stop making direct payments, the process for notifying affected individuals, and the rights of those individuals to request a reconsideration of the decision.

Specifically, we propose that a local health board may require the repayment of part or all of a direct payment where it is satisfied that such repayment is appropriate, having particular regard to whether:

• the care and support plan has changed substantially
• the direct payment recipient’s circumstances have changed substantially
• a substantial proportion of the direct payments have not been used to secure services specified in the care and support plan and have accumulated
• the direct payments have been used for purposes other than those specified in the care and support plan
• theft, fraud, or another offence may have occurred in connection with the direct payments
• the person in receipt of the payments has died

In circumstances where a local health board determines that repayment is required, we propose that it must provide reasonable written notice to the individual and any representative or nominee, specifying the reasons for the decision, the amount to be repaid, and the time within which repayment must be made. 

In the event of the direct payment recipient’s death, we propose that the notice must be issued to their personal representatives.

Reconsideration

Reconsideration Upon receipt of a notice requiring repayment, we propose that the direct payment recipient, personal representative, representative, or nominee may request that the local health board reconsider its decision. They may also submit evidence or relevant information for the local health board to take into account during its reconsideration. 

Our proposal is that following a request for reconsideration, the local health board must notify the individual and any personal representative, representative or nominee in writing of its decision. 

We propose that a local health board is not required to undertake more than one reconsideration following a decision to require repayment. 

We further propose that a local health board may waive all or part of any repayment, whether following the initial decision, or upon reconsideration.

Recovery in cases of suspected offence

We further propose that where a local health board has determined that a sum must be repaid and the reason for that decision is that theft, fraud, or another offence may have occurred in connection with the direct payment, the amount in question may be recovered as a civil debt. 

We propose that regulations will further outline that the provision for recovery as a civil debt does not affect or limit any other method of recovery available to the local health board.

Cessation of direct payments

We propose to include in regulations the circumstances in which a local health board may stop making direct payments if it is satisfied that it is appropriate to do so, including but not limited to the following circumstances:

• where a person, other than a child, who has capacity to consent, either does not consent or has withdrawn consent to the making of direct payments
• where a child or a person who lacks capacity to consent no longer has a representative who consents to the making of direct payments
• the person in respect of whom the direct payment is made is no longer in receipt of health services
• the representative or nominee is no longer considered a suitable person to receive direct payments, does not agree to receive the direct payments or their nomination has been withdrawn
• the direct payments have been used for purposes not specified in the care and support plan
• the local health board believes that theft, fraud, or another offence may have occurred in connection with the direct payments
• the person’s health needs cannot be, or are not being, met through services secured by means of direct payments
• the person has died

We further propose that where a local health board decides to stop making direct payments, it must provide reasonable written notice to the direct payment recipient and any representative or nominee, stating the reasons for the decision.

In the case of a deceased person, we propose the notice must be issued to their personal representatives.

We propose that, upon receipt of such notice, the direct payment recipient, personal representative, representative, or nominee may request that the local health board reconsider its decision. They may also submit evidence or relevant information for the local health board to take into account.

In such circumstances we propose that the regulations will require that a local health board must inform the direct payment recipient and any personal representative, representative, or nominee in writing of the outcome of the reconsideration, including the reasons for the decision.

We propose that a local health board should not be required to undertake more than one reconsideration following a decision to stop making direct payments.

We ask for your views on this section of the consultation at question 8.

Making provision for a direct payment in relation to social care to be made to a third party, such as a nominated individual or an organisation

The Health and Social Care (Wales) Act 2025 contains provisions restating, with some changes, provisions in the Social Services and Well-being (Wales) Act 2014 (the 2014 act) relating to the making of direct payments in relation to social care. The 2025 act also makes an amendment to part 4 of the 2014 act to allow local authorities to make direct payments to a person (either a nominated individual or an organisation) where the person to whom the payment could otherwise have been made has capacity to consent to the making of a direct payment (or, in the case of a child, are deemed by a local authority to have sufficient understanding to make an informed decision about consenting to the making of direct payments). This amendment was made to align to current practice and ensure equivalent rights to those currently enjoyed by an adult recipient of a direct payment who lacks capacity, where a “suitable person” may receive and manage the payment on their behalf.

We intend that the existing regulations made under the 2014 act, which govern the making of direct payments for social care, will be remade as a result of the redrafted provisions in part 4 of the 2014 act. We propose that these regulations will contain amendments in relation to the ability of a social care direct payment recipient with mental capacity to nominate a person to receive and manage their direct payment. We will also make corresponding amendments to the code of practice on meeting needs under part 4 of the 2014 act, should these prove to be necessary.

This proposal is being included in this consultation as it also deals with direct payments. We would welcome your views on this change to the legislation, which is being done to align current practice and the legislation, and to continue to support the policy intent to maximise choice and person-centred care arrangements. 

We ask for your views on this section of the consultation at question 9.

Question 1

What are your views on the proposal to amend the Local Health Boards (Directed Functions) (Wales) Regulations 2009 to delegate to local health boards the function of making direct payments?

Question 2

What are your views regarding the circumstances in which, and persons to whom, direct payments may be made? Please share any suggestions for any changes or additions you would like to see.

Question 3

What are your views regarding the consultation and assessment a local health board should undertake before deciding to make direct payments? Please share any suggestions for any changes or additions you would like to see.

Question 4

What are your views regarding the care and support plan, care coordinator and one-off direct payments? Please share any suggestions for any changes or additions you would like to see.

Question 5

What are your views regarding our proposals about information, advice and support? Please share any suggestions for any changes or additions you would like to see.

Question 6

What are your views regarding conditions to be complied with by those in receipt of direct payments? Please share any suggestions for any changes or additions you would like to see.

Question 7

What are your views regarding amount, monitoring and review of direct payments? Please share any suggestions for any changes or additions you would like to see.

Question 8

What are your views regarding repayment and recovery of direct payments, cessation and repayment of direct payments? Please share any suggestions for any changes or additions you would like to see.

Question 9

What are your views regarding making provision in regulations (and, where necessary, in a code of practice) for a direct payment in relation to social care to be made to a nominated third party? Please share any suggestions for any specific points which would need to be addressed.

Question 10 

We will work to ensure that the regulations as proposed in this consultation document are supported by guidance to help both direct payment recipients and practitioners understand how the system should operate. What specific topics or issues should the guidance cover to further support the proposed regulations?

Question 11

What are your views on the likely impact of the proposed content of the regulations on particular groups of people, particularly those with protected characteristics under the Equality Act 2010? What effects do you think there would be?

Question 12

What, in your opinion, would be the likely effects of the proposed content of the regulations on the Welsh language? We are particularly interested in any likely effects on opportunities to use the Welsh language and on not treating the Welsh language less favourably than English.

Question 13

In your opinion, could the proposals be formulated or changed so as to:

• have positive effects or more positive effects on using the Welsh language and on not treating the Welsh language less favourably than English
• mitigate any negative effects on using the Welsh language and on not treating the Welsh language less favourably than English?

Question 14

We have asked a number of specific questions. If you have any related issues which we have not specifically addressed, including other impacts of these proposals such as cost which you would like to share your views on, please use this space to let us know.

Submit your comments by 8 October 2025, in any of the following ways:

• complete our online form
• download, complete our response form and email: HSC.DirectPaymentsConsultation@gov.wales
• download, complete our response form and post to:

Direct Payments Policy Team
Inclusion and Corporate Business Division
Social Services and Integration Directorate
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Please include the reference WG52343.

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• to be informed of the personal data held about you and to access it
• to require us to rectify inaccuracies in that data
• to (in certain circumstances) object to or restrict processing
• for (in certain circumstances) your data to be ‘erased’
• to (in certain circumstances) data portability
• to lodge a complaint with the Information Commissioner’s Office (ICO) who is our independent regulator for data protection

Responses to consultations are likely to be made public, on the internet or in a report. If you would prefer your response to remain anonymous, please tell us.

For further details about the information the Welsh Government holds and its use, or if you want to exercise your rights under the GDPR, please see contact details below.

Data Protection Officer

Data Protection Officer
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Email: data.protectionofficer@gov.wales

Information Commissioner’s Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF

Telephone: 01625 545 745 or 0303 123 1113

Information Commissioner’s Office website.

The Welsh Government will be data controller for any personal data you provide as part of your response to the consultation. Welsh ministers have statutory powers they will rely on to process this personal data which will enable them to make informed decisions about how they exercise their public functions. Any response you send us will be seen in full by Welsh Government staff dealing with the issues which this consultation is about or planning future consultations. Where the Welsh Government undertakes further analysis of consultation responses then this work may be commissioned to be carried out by an accredited third party (e.g. a research organisation or a consultancy company). Any such work will only be undertaken under contract. Welsh Government’s standard terms and conditions for such contracts set out strict requirements for the processing and safekeeping of personal data. In order to show that the consultation was carried out properly, the Welsh Government intends to publish a summary of the responses to this document. We may also publish responses in full. Normally, the name and address (or part of the address) of the person or organisation who sent the response are published with the response. If you do not want your name or address published, please tell us this in writing when you send your response. We will then redact them before publishing.

You should also be aware of our responsibilities under Freedom of Information legislation. If your details are published as part of the consultation response then these published reports will be retained indefinitely. Any of your data held otherwise by Welsh Government will be kept for no more than three years.

For further information about this consultation contact:

Direct Payments Policy Team
Inclusion and Corporate Business Division
Social Services and Integration Directorate
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Email: HSC.DirectPaymentsConsultation@gov.wales

Number: WG52343

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