Economic Affairs Committee report

July 4, 2019

A new House of Lords Economic Affairs Committee report has been released, stating that Government should immediately spend £8bn to restore the quality of, and access to, adult social care in England.

Social care funding: time to end a national scandal is also calling for Government to introduce free personal care, funded through general taxation, over a period of five years.

Lord Forsyth of Drumlean, Chairman of the Economic Affairs Committee, said, 'Social care is severely underfunded. More than a million adults who need social care aren't receiving it, family and friends are being put under greater pressure to provide unpaid care, and the care workforce continues to be underpaid and undervalued.

'The whole system is riddled with unfairness. Someone with dementia can pay hundreds of thousands of pounds for their care, while someone with cancer receives it for free. Local authorities are increasingly expected to fund social care themselves, despite differences in local care demands and budgets. The reduction in social care funding has been greatest in the most deprived areas. And local authorities can’t afford to pay care providers a fair price, forcing providers to choose whether to market to those people who fund their own care or risk going bankrupt.

'Fixing under-funding is not difficult. The Government needs to spend £8bn now to return quality and access in the system to an acceptable standard. Fixing unfairness is more complicated, but the Government has ducked the question for too long. They need to publish a White Paper, not a Green Paper, with clear proposals for change now. We think that change should include the introduction of free personal care, ensuring those with critical needs can receive help with essential daily activities like washing, dressing and cooking.

'Our recommendations will cost money, but social care should be a public spending priority. By 2023/24, the NHS funding will have increased by £20.5bn per year. This is more than the entirety of local authority adult social care expenditure.'

The Committee found that publicly funded social care support is shrinking, as diminishing budgets have forced local authorities to limit the numbers of people who receive public funding. Funding is £700m lower than 2010/11 in real terms, despite continuing increases in the numbers of people who need care.

More than 400,000 people have fallen out of the means test, which has not increased with inflation since 2010. The Health Foundation and The King’s Fund estimate that to return quality and access to levels observed in 2009/10,  Government would need to spend £8bn.

To address unfairness in the system, the Economic Affairs Committee report proposes introducing free personal care, saying that this is simple, fair, and not much more expensive than other proposals for reform.

Those in care homes would still pay for their accommodation and 'extras'. Those receiving care in their own homes would still pay for assistance with less critical needs like housework or shopping, but would not pay for support with personal care, which the Economic Affairs Committee hopes may encourage care users to seek essential help early. This model would cost £7bn per year according to the Health Foundation and the King’s Fund, only £2bn more than the Government’s 2017 'cap and floor' proposal.

The report argues that additional funding for social care should come from national government, which should raise the money largely from general taxation and distribute it to local authorities according to a fair funding formula.

Commenting on the Economic Affairs Committee report, Vic Rayner, Executive Director of the National Care Forum, said, 'The message is clear for the future Prime Minister – adult social care is domestic priority number one – and the combined voices of local government, providers of care and the workforce, members of the House of Lords, parliamentarians from across the parties and people receiving care and support and their carers demand action now.

'We have had over two years of waiting for the Government to produce a reform document, and these were not years we had to spare. Our approach to reform must now recognise the extreme pressures that all parties are united in their analysis of. To take no immediate action in the face of this evidence as a new Prime Minister will not serve this country well.'

Anita Charlesworth, Director of Research and Economics at the Health Foundation has also commented, saying, ‘The House of Lords report shines a welcome light on the perilous state of adult social care in England. Since 2010, funding has fallen in real terms while need has grown and, as a result, many individuals and their families have been left to cope without vital support. The committee is absolutely right that social care now needs a substantial injection of public funding to ensure that those in need have access to care, and to tackle the growing workforce crisis...

‘While additional funding will help stabilise the sector, the House of Lords report is further evidence that the current means-tested system doesn’t work and needs fundamental reform. The Government must now find the political will to bring about a fairer, more sustainable system that protects more people from the catastrophic costs of care. It is inevitable that any serious reform will be expensive. If we don’t want to further damage wider public services, the money will need to come from increased taxation. With so many failed attempts at reform, we now need an honest and open public debate about the level of support that the state will provide and how this will be paid for.

‘The committee has ultimately underlined that doing nothing is no longer a viable option and that social care reform must be at the top of the policy agenda for whoever next leads the country.’

Sally Warren, Director of Policy at The King’s Fund said of the Economic Affairs Committee report, 'The social care system is no longer fit for purpose and is failing the people who use it, their families and carers. This report, from an influential cross-party group which includes two former Chancellors, makes a strong case for immediate, additional public investment in social care.

‘In the longer term the case for change is overwhelming, and we welcome the Committee’s call to move towards a more generous system that would give more people access to publicly-funded social care as a useful contribution to the public debate. Any kind of fundamental reform will require more money – but continuing to patch up the current failing system would also be costly and would not tackle its fundamental flaws that impact on families every day.

‘Politicians must therefore be honest with the public about the shortcomings of the current system and the costs of reform.

‘Reforming social care is now one of the most urgent and important social policy issues facing the country and should be at the top of the agenda for the new Prime Minister.'

Charles Armitage, Founder and Chief Executive of Florence has also reacted. He said, 'Putting the sorry state of our social care system back in the limelight once again, the usual flurry of media interest can be found on newsstands up and down the country. But what is it going to take for someone to actually do something?

'Whether it's denial, apathy or just the sheer weight of all the challenges this country is facing right now with the distraction of Brexit – make no mistake we are on the brink of something akin to a humanitarian crisis in our own back yard. Local authorities’ budgets have been decimated by austerity policies and one third of councils are unable to fulfil their legal duties of care. It’s a big ship to turn, granted, but we are moving far too slowly on this.

'The Government’s been consistently delaying presenting a long-term vision on social care funding. Is bringing social care under the NHS’s wing and providing a free-at-the-point-of-need service the answer? Is it even viable? I would question why we are perpetually stuck in this debate as opposed to rolling out a plan of action. Rather than rhetoric in response to the latest news story, I’d like to see the prime ministerial hopefuls show a genuine, purposeful commitment to creating and acting on a lasting plan for social care funding.'

Stephen Lowe, Communications Director at Just Group said that earlier planning for care costs and professional advice need to be at the heart of any future reforms; 'This report is evidence that patience is running out with the Government on reforming the adult social care system in England. Its call for £8bn a year immediate extra funding and free personal care for those who need it shows that the longer we put off decisions the more radical the solutions that are likely to be needed.

'Even this won’t solve the financial problem facing families, who are still likely to need to meet extra costs in terms of accommodation or aspire to receiving more than the basic level of service provided by the State. The reforms must encourage people to consider future care needs earlier in their working life as part of their overall retirement strategy and to encourage take up of professional financial advice.

'Our recent Care Report 2019, the seventh in a research series dating back to 2012, revealed the difficulties faced by those who had accessed the care system for a relative or friend...

'Their experience should focus our politicians’ attention on making some real progress towards a long-term, sustainable solution that will give us the standards of care we aspire to in later life.'

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