Report 37: Personalisation, productivity and efficiency

Impact on costs

'More creative and flexible use of funds can result in an increase in hours per pound when compared with local authority or independent agencies' (7)

Some evidence suggests that if people have choice and control over their care and support, most commonly through the use of personal budgets and direct payments, then this can potentially result in efficiencies such as waste and overhead cost reduction, improved value for money and better outcomes for both people who use services and their carers.

There is increasing evidence from the independent provider sector and from micro services that local authority commissioning practice is not yet facilitating the type of market development and diversification needed for personal budgets to be used effectively and efficiently. The voluntary sector is providing some evidence on providing efficient and cost effective services for people using a personal budget, but their market position is difficult to maintain (8, 9, 10, 11, 12).

The 2006 Audit Commission's report on direct payments and the costs and benefits of choice said that 'the key determinant of any potential savings is the trade-off between the price set by local authorities for direct payments and the additional costs of providing them. The critical variables are the number of clients using direct payments and the average number of hours in direct payment care packages' (13). The Audit Commission's 2010 survey on personal budgets said that:

 'councils should not expect to achieve large cost savings from personal budgets, but self-directed support may allow savings in individual, high-cost cases where commissioning has previously been poor' (14).

Outcome-based, user-directed, flexible approaches to commissioning services, rather than rigid 'time and task' delivery models, could result in greater efficiency. Electronic monitoring and scheduling of home care can support this.

A CSED evaluation showed that 'the implementation of an automated system for the monitoring and scheduling of time spent by home care workers providing care to services users' could result in the following efficiencies:

However, service users' ability to use their personal budgets to purchase better value care and support can be limited by their local social care and support market as well as their personal budget amount.


All SCIE resources are free to download, however to access the following download you will need a free MySCIE account:

Available downloads:

  • SCIE Report 37: Personalisation, productivity and efficiency