Personal budgets and EHCPs: how Section J and direct payments work | EHCP Clarity
Section J Personal Budgets

Personal budgets and EHCPs: how Section J works

Personal budgets give families and young people direct control over elements of EHCP provision. Section J of the EHCP records the personal budget arrangement; the funds can be paid as direct payments, held by the LA, or held by a third party. This guide explains what personal budgets can cover, how to request one, and how to navigate LA reluctance.

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Quick answer

Personal budgets allocate funds for elements of EHCP provision in Section F (education), G (health) and H (social care). The right to request is set out in section 49 CFA 2014 and the SEND Personal Budget Regulations 2014. Funds can be paid as direct payments to you, held by the LA as a notional budget, or held by a third party. Cannot fund school fees. Common uses: specialist tutoring, therapy, equipment, parent training.

The legal basis for personal budgets

Section 49 of the Children and Families Act 2014 gives parents and young people aged 16+ the right to request a personal budget when an EHCP is being prepared, reviewed, or amended. The detail is in the Special Educational Needs (Personal Budgets) Regulations 2014, which set out who can request, what the LA must consider, and how decisions must be communicated.

The SEND Code of Practice (Chapter 9, paragraphs 9.95-9.124) provides statutory guidance on personal budgets — covering eligibility, scope, the LA's duty to provide information, and the process for direct payments.

Personal budgets reflect a policy aim to give families control over how SEN provision is delivered. Take-up varies widely between LAs — some have well-developed frameworks; others are reluctant and offer little information unless pressed.

The three personal budget payment routes

Direct payments

Funds paid directly to the parent or young person. Family commissions and pays for provision. Requires LA agreement, an agreed plan for use, and record-keeping. Maximum control but maximum responsibility.

Best for: families confident managing provision (booking tutors, paying invoices), discrete services with named providers.

Notional budget

Funds held by the LA on behalf of the family. Family chooses provision; LA pays providers directly. No money passes through family's accounts. Less administrative burden than direct payments.

Best for: families who want choice over providers but don't want financial admin.

Third-party arrangement

Funds held by an organisation (e.g. user-led organisation, broker, charity) on family's behalf. The third party manages payments and admin. Useful where direct payment is suitable but family lacks capacity to manage admin.

Best for: families wanting direct payment benefits without admin overhead.

What personal budgets can fund — and what they cannot

Personal budgets can fund:

  • Specialist 1:1 tutoring (e.g. dyslexia specialist, autism specialist)
  • Therapeutic input — counselling, psychotherapy, OT, SALT, music therapy
  • Equipment specified in Section F (e.g. assistive technology)
  • Training for parents in specific approaches (e.g. PDA, autism)
  • Short breaks and respite activities
  • Specialist outdoor education and forest school
  • Specific elements of social care provision in Section H
  • Independent advocacy or coaching

Personal budgets cannot fund:

  • School or college fees (placement is funded through the LA naming the school in Section I)
  • Top-ups to school placements
  • Provision delivered as part of school's normal staff contract
  • Provision the LA has a statutory duty to make in some other way (e.g. statutory NHS provision)
  • Items of general personal benefit not in the EHCP

How to request a personal budget

  1. 1

    Identify which elements of provision are suitable

    Personal budgets work best for: discrete bookable services (tutoring, therapy), equipment, parent/family training, and short breaks. Less suitable for: continuous in-school support, education delivered by school staff.

  2. 2

    Cost the provision precisely

    Get quotes from named providers. The personal budget must be sufficient to deliver the provision specified in Section F/G/H. Without precise costing the LA will struggle to set an appropriate amount.

  3. 3

    Submit the request in writing

    Write to the LA SEND team requesting a personal budget for specified elements of provision. Reference section 49 CFA 2014 and the SEND Personal Budget Regulations 2014. Specify which payment route (direct payment, notional, third-party).

  4. 4

    Engage with the LA's response

    The LA must consider and respond. If accepting, agree the amount and arrangements. If refusing, get written reasons and consider whether to challenge through complaints process.

  5. 5

    Set up management and reporting arrangements

    If receiving direct payments, you'll need a separate bank account and to keep records. The LA may require quarterly or annual reports on how money has been spent. Set up systems early.

  6. 6

    Review at annual review

    Personal budget arrangements should be reviewed at each annual review. Has it delivered the specified provision? Should the amount change? Should the payment route change?

Personal budget request checklist

  • Identified specific elements of Section F/G/H suitable for personal budget
  • Costed provision with named providers and quotes
  • Decided on preferred payment route (direct payment, notional, third-party)
  • Written request to LA referencing section 49 CFA 2014
  • Plan for managing direct payments if chosen (bank account, records)
  • Understanding of reporting and review requirements
  • Annual review provides for personal budget review

Common LA pushbacks on personal budgets

  • "We don't do direct payments for EHCPs" — wrong. Direct payments are a statutory option; LAs cannot refuse the principle.
  • "There is no policy for personal budgets" — LAs must publish a personal budget policy under SEND regulations; if not, they are in breach.
  • "You cannot use personal budget for tutoring" — tutoring is commonly funded through personal budget where it is part of Section F provision.
  • "There is no money available" — funds for Section F provision are budgeted regardless; personal budget moves the same money to a different commissioning route.
  • "Direct payments are too risky" — proper safeguards (agreed plan, records, reporting) manage risk; the LA cannot refuse on this basis alone.

Frequently asked questions

What is a personal budget?
A personal budget is a sum of money allocated for elements of the special educational, health or social care provision in your child's EHCP. The budget appears in Section J of the EHCP. It can be paid as a direct payment to you, held by the LA on your behalf (notional budget), or held by a third party (third-party arrangement).
Who can request a personal budget?
Any parent of a child with an EHCP, or a young person aged 16+ with an EHCP, has the right to request a personal budget. The LA must consider the request and provide reasons if it refuses any element. The right to request is set out in section 49 of the Children and Families Act 2014 and the SEND Personal Budget Regulations 2014.
What can a personal budget cover?
Personal budgets can cover elements of provision in Section F (special educational), Section G (health), and Section H (social care). Common areas: specialist tutoring (e.g. dyslexia or autism specialist), therapeutic input (counselling, OT, SALT), short breaks, equipment, training for parents/staff, and life skills work.
Can a personal budget cover school fees?
No. Personal budgets cannot be used to fund a place at a school or college that is not named in Section I — including independent schools. Personal budgets fund elements of provision (specialist input, equipment), not the placement itself.
How much money is involved?
There is no minimum or maximum statutory amount. The amount reflects the cost of the specific provision in the EHCP that is being delivered through the personal budget. Some budgets are a few hundred pounds; others tens of thousands. The amount must be sufficient to deliver the specified provision.
What are direct payments?
Direct payments are personal budget funds paid directly to the parent or young person, who then commissions and pays for the provision themselves. Direct payments require LA agreement and an agreed plan for how money will be spent. Records must be kept and money used only for the agreed purposes.
Can the LA refuse a personal budget?
Yes, in some circumstances. The LA must consider the request but can refuse where: the provision cannot be reasonably commissioned by the family, where it would be inefficient use of public funds, or where direct payments would not be appropriate. The LA must give written reasons for refusal.
Can I appeal a personal budget refusal?
Section J (personal budget) is not directly appealable to the SEND Tribunal. However, refusals can be challenged through the LA's complaints process and the Local Government and Social Care Ombudsman. If the underlying provision in Section F/G/H is wrong, that may be appealable on its own merit.

Related guides

Sources and further reading

This is general information, not legal advice. EHCP Clarity helps parents organise and prepare their own materials. It does not provide legal advice, legal representation, or tribunal advocacy, and nothing on this page should be relied on as a substitute for advice about your specific situation. For free independent expert support, contact IPSEA, SOS!SEN, or your local SENDIASS. For legal representation, instruct a SEND solicitor.