The Court of Protection has handed down an important and potentially far-reaching judgment in Various Applications, In the Matter of (Re Direct Payments) [2026] EWCOP 42 (T2), bringing much-needed clarity to the role of deputies in managing Direct Payments across a range of statutory funding regimes.
The case concerned seven applications involving individuals with significant disabilities, many arising from catastrophic brain injuries, whose care packages were funded through a mixture of private funds and public funding. Professional deputies sought confirmation that the management of Direct Payments fell within the ordinary powers of a property and affairs deputy. The Court rejected that argument.
At the heart of the dispute was whether managing Direct Payments is simply an administrative exercise or whether it involves welfare decision-making. The applicant deputies argued that they were merely implementing care arrangements determined by public bodies. The Court concluded, however, that Direct Payments are underpinned by a broader policy objective of choice, flexibility and personalised care. The person managing Direct Payments is often required to make judgments about how care is delivered, how care plans are implemented, whether Direct Payments remain appropriate and how best to deploy available resources. Those decisions involve welfare considerations.
HHJ Hilder therefore held that managing Direct Payments is not part of the "general authority" typically granted to a property and affairs deputy. Instead, it is a distinct function requiring specific authority from the Court of Protection. The Court further held that the authority required is a mixed authority, incorporating aspects of both property and affairs and welfare decision-making.
Importantly, the judgment is not simply restrictive. Recognising the practical realities faced by many protected parties and their families, the Court created a clear pathway for deputies to continue managing Direct Payments. Detailed model wording was provided for future applications, along with comprehensive guidance regarding the evidence required to support such applications. The Court also confirmed that deputies acting under appropriate authority can be remunerated and reimbursed for reasonable costs incurred in carrying out these functions.
The Court additionally addressed historic practice. Deputies who have managed Direct Payments without specific authority may need to seek retrospective authorisation, but a pragmatic long-stop date of 11 October 2024 (the date of the earlier Lumb decision) was adopted to avoid disproportionate retrospective applications. Existing SCCO assessments will generally not need to be revisited.
This is a significant judgment because it acknowledges the reality of how many complex care packages operate in practice. Rather than treating Direct Payments as a purely financial mechanism, the Court recognised their role in supporting personalised and flexible care arrangements. At the same time, it has provided a clear legal framework for deputies, families, practitioners and public bodies to follow in future.
The decision is therefore likely to be seen less as a change in the availability of Direct Payments and more as an important clarification of the legal authority required to manage them. By providing certainty where uncertainty previously existed, the judgment should assist all those involved in delivering and funding care for vulnerable claimants.
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