Payments to foster carers

Benefits

If you receive a fostering allowance, you cannot include the child you foster in a claim for:

  • child benefit
  • family tax credit

Some disabled children are entitled to have an allowance such as a disability living allowance.  This will be changing to personal independence payments for those aged 16 and over.

Disability Living Allowance

Disability Living Allowance (DLA) is a Department of Work and Pensions benefit available to disabled children.  It is for personal care or supervision over and above other children of the same age because of their illness or disability.

The DLA benefit is paid at different rates according to the child’s needs. It contains both a care and mobility component:

  • the care component is paid at a low, medium or high rate.  It may be payable to a disabled child from the age of three months; once the child’s needs have been assessed
  • the mobility component is paid at a low or high rate, namely a higher rate from age three and a lower rate from age five.

Some children will receive either one or both elements.

Sometimes a child receives a DLA before becoming a child in care. For these cases, the child’s social worker should have discussions with the parent about the transfer of the DLA to the foster carer.

The parent must notify the Department of Works & Pensions that the child is no longer in their care. 

The foster carer is advised to make an application to receive the DLA. In the same way, if a child moves from one foster carer to another, the foster carer must notify the DWP.  Any DLA money is then transferred to the new carer.

DLA is awarded to the child, not the carer. Normally, if the child is under 16, the carer acts as an appointee. Otherwise, the young person, can have the benefits paid to them directly, providing they are capable.

The DWP does not have conditions on to how the money should be spent. The money is intended to be used to enhance the child’s life.  The child should get the maximum benefit from the DLA.

Foster carers will be expected to set up a separate bank account, in the foster carer’s own name, into which the DLA will be paid. The money is not intended to be saved for the child for use in later years as this could result in them being penalised. For example:

  • if there is more than £3,000 in an account when the child returns home, this will affect any benefits claimed by the parents
  • for a child reaching 16, a sum of more than £8,000 will affect their claim for universal credit and housing benefits

The child’s social worker must be involved in discussions on how the DLA can be used to improve the child’s life.  They are responsible for monitoring the way the money is spent. Carers are not expected to produce receipts for small items of expenditure but must show how it is being used for the child’s benefit. Any expenditure over £50 will require a receipt.

Scrutiny of the money process is the responsibility of the child’s social worker.  They will ensure that the DLA is being spent appropriately and is supported by the SSW.  If there is evidence that the foster carer is not spending the DLA on the child, it would be appropriate to make another adult the appointee.

Examples of how the money could be spent:

  • activities that are costly such as horse riding and after school clubs
  • provision of an escort to enable social events to be attended
  • extra helper for an outing or holiday
  • taxi fares for trips out
  • extra support such as a child sitting service, using individuals who are Disclosure and Barring Service checked
  • individual equipment such as a computer or communication aids
  • laundry service and appliances
  • replacement clothing where there is excessive wear and tear on clothing
  • additional heating costs
  • additional help with personal care
  • anything that will improve the child’s life
  • special toys to meet a child’s needs, which may be of therapeutic value
  • domestic help to allow a carer to spend more time with their child

Upon receipt of the allowance, all foster carers should discuss how the money will be spentThis discussion must be recorded by the supervising social worker (SSW).

Each looked after review will consider how the money has been spent to benefit the child.  Additional activities for children receiving a DLA should not routinely be paid for from additional fostering allowances.