Personal budgets in social care are a mechanism for the allocation of resources for care that permits users'greater choice and flexibility. This study was designed to explore developments in care coordination arrangements by examining the flexible use of resources. Two national surveys identified agencies with such arrangements in older people's services in advance of this agenda, described here as innovative authorities. Telephone interviews with their representatives explored salient factors in the development, focus, and operation of personal budgets. Carers were the main recipients, and there was also evidence of more appropriate use of resources structured around service users' needs. Implementation of personal budgets requires authorities to be more creative and flexible in respect of internally held budgets to meet the needs and wishes of older service users. This study provides evidence that some of these requirements have already been adopted by a few agencies.