Social care insights
From Simon Bottery

Simon Bottery of The King’s Fund asks, if we are to have a social care reform, where is the money coming from to fund it?

If trouble really does come in threes, as the proverb suggests, then no one should be looking forward to the next National Audit Office (NAO) report that touches on adult social care. Because we had two reports from it in March and they were bad enough.

Over 40% of the spending of single-tier and county councils is on adult social care, so it is obvious that local authority finances are critical to the sector’s health. The first NAO report looked at local authority finances as a result of the COVID-19 pandemic and its findings were that, while the financial position of individual councils varies a great deal, overall there are big problems.

For 2020/21, there is a ‘funding gap’ between forecast pressures due to the pandemic and national emergency funding. Many councils will rely on reserves to balance budgets. The outlook for 2021/22 is no better. Many local authorities are setting budgets ‘in which they have limited confidence’, and planning service cuts and even further drawdown of their reserves.

For single-tier and county councils, 41% expect to make ‘significant’ reductions to services during the year. A further 53% expect to make ‘some’ reductions. Examples of these service reductions cited include closure of libraries, reduction in grants for homelessness support and, yes, reviews of adult social care packages and increased client contribution.

Reading the second NAO report on the adult social care market, you might also worry about a further tightening of the rates paid by local authorities for commissioned social care services. However, that would be risky: the report notes that ‘significant numbers of large providers are not financially resilient’ and includes an acknowledgement by the Department of Health and Social Care that most local authorities already pay below the sustainable rate for home care and for older people’s care home placements.

The report sets these and other findings in the context of reduced funding for local authorities over the last decade, starting long before COVID-19 struck. It points out that Government funding for local authorities fell by 55% in 2019-20 compared with 2010-11, resulting in a 29% real-terms reduction in local Government spending power. The report is also highly critical of a wider lack of oversight and direction from national Government on adult social care.

While the report acknowledges an increase in funding since 2014/15, it points out that much has been in short-term grants and its conclusions are as depressing as the first report: ‘The lack of a long-term vision for care and short-term funding has hampered local authorities’ ability to innovate and plan for the long term, and constrained investment in accommodation and much-needed workforce development.’

Together, the two NAO reports are an important reminder of a key lesson that many took from reform of adult social care in 2014: that while the Care Act was a fine piece of legislation, there was never enough money to implement it. So even if (and it’s a huge IF) the Government proposes genuine reform of adult social care in its white paper later this year, the next question must be: and where’s the money coming from?

Simon Bottery is a Senior Fellow in Social Care at The King’s Fund. Email: Twitter: @blimeysimon




About Simon Bottery

Before joining The King’s Fund in 2017, Simon spent almost 10 years as Director of Policy at the older people’s charity Independent Age. He has wide experience in policy, communications and journalism, including as Director of Communications at Citizens Advice, in the commercial sector for Guinness and in BBC local radio.

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