DP sector challenges

The direct payment support service (DPSS) market is fragmented but has always been quite stable:

• Fragmented - Whilst there are a handful of organisations operating nationally, there is also a large number of relatively small organisations working across the sector.
• Stable - Because of the close relationships that these organisations often have with their local authority, there is a relatively low level of ‘churn’.  

In recent months, we have noticed some changes.  Two DPSS organisations have closed abruptly, and we are aware of other DPSS organisations that are reviewing their operations and/or considering exiting the market. 

Vibrance were a registered charity, formed in 1989 and based in Essex.  Alongside some care provider operations, Vibrance were contracted to provide DPSS to five key local authorities.  They also worked with a number of other local authorities providing services on a ‘spot contract’ basis. 

We became aware of Vibrance when its advisors approached us to consider buying its DPSS business in November 2025.  That wasn’t to be, and Vibrance was placed into administration shortly afterwards.  The majority of its care provider operations were immediately sold to another provider, but the DPSS business failed to find a buyer.  The DPSS contracts were returned to the local authorities at short notice, disrupting the arrangements of over 2,000 direct payment holders and led to the redundancy of 20 staff. 

It has turned out to be an awful scandal, as direct payment funds held by Vibrance on behalf of local authorities had gone missing.   The Administrator’s official report states “In mid-2025, Vibrance identified a reconciliation issue relating to self-directed support funds”, and goes on to say that direct payment funds from different local authorities had been co-mingled and used to fund losses within the care provider operations of Vibrance.  In theory, Vibrance was holding £11m of direct payment funds.  In reality, there was nothing in the bank account, leaving local authorities collectively nursing a financial loss of £11m.

At the other end of the country, another DPSS organisation shut its doors overnight just before Christmas.  Fife Business Services worked for several Scottish local authorities, processing payroll and managed accounts for over 600 direct payment holders.  Five staff were made redundant when it was placed in liquidation.  There is no suggestion of funds going missing in this case, with the liquidators simply saying that “the business has been trading at a loss for some time”. 

The DPSS market has always been a tough environment to make a living in - NHS Shared Business Services wound up its PHB Choices offering after it failed to take off, and My Support Broker / My Support Money closed its operations in July 2025.  However, all the signs are that it is getting even tougher, and it seems that further rationalisation and consolidation in the market is inevitable. 

A small silver lining is that PPL has been able to come to the rescue of several direct payments holders in Scotland that needed urgent help paying their carers.  PPL has also taken on staff made redundant by both Vibrance and Fife Business Services to help us manage our growth.  

In the meantime, clients of PPL can rest assured that we remain in good financial shape and that their funds are always safe as we reconcile the physical funds in each local authority's ring-fenced bank account to our Virtual Wallet system every day.