This chapter is the first of two with a focus on England, which was an early adopter of IF policies. It explores the origins of IF in that national context, including the political struggles that led to the introduction of a form of IF called ‘direct payments’ under John Major’s Conservative government in the 1990s. Direct payments, I argue, were initially a small but important part of a much broader political strategy to empower disabled people and democratise the welfare state. This strategy was embedded in a multi-dimensional social critique that targeted three forms of injustice: cultural, economic and political. Yet during the Thatcher-Major years, the disability movement’s critique of welfare paternalism converged with certain currents of neoliberal thought and policy making. Meanwhile, its critique of capitalism, flowing from the social model, was subordinated to the struggle against state control. Initially designed as a participatory mechanism, direct payments were refashioned as a market mechanism and put to work in service of retrenching the welfare state.