England & Wales Health and social care

Local government still in the dark over social care funding


Social care has been promised more money. But when and more importantly how and for what exactly asks Jonathan Carr-West. This piece was originally published in Public Finance

Too often, we treat social care simply as a financial problem and, of course, money is part of the challenge. For upper-tier authorities, social care is by far their biggest spend. At LGIU, we’ve been surveying councils about their finances for a decade and we are consistently told that social care is the greatest long-term pressure they face. For individuals, too, care costs can be disastrous.

Social care is also a market problem. Many providers find themselves unable to offer care profitably, or even safely, at the rates that cash-strapped local authorities can afford, and exit the market. Across the country, councils find themselves picking up the pieces when providers are unable to continue.

There’s a workforce problem too. Care workers are under-appreciated and underpaid, often working on precarious contracts and with few, if any, career pathways.

Finally, there’s a delivery problem. What does good care look like? How should we commission it? How does it intersect with other public services?

In the end, all of this adds up to a people problem. Too many people are receiving neither the level nor the quality of care we would wish for ourselves and our loved ones.

Understanding the full dimensions of the problem is important in considering how far the government’s social care plan meets the challenge and what the long-term impacts on local government might be.

Let’s start with the positives. Social care reform has been delayed repeatedly over the last decade and more. So it’s good that we’re talking about it and that the government is publicly committing to a plan to fix it. Social care funding is so broken that any additional money should also be welcomed.

But, leaving aside the argument about whether National Insurance is a fair funding mechanism, it’s not at all clear how or when much of the money will eventually find its way to social care. Without a clear timetable around this shift, many in local government will suspect that the additional funding from the new NI levy will be permanently swallowed up within the NHS.

Equally worryingly, the plan says that “demographic and unit cost pressures will be met through council tax, social care precept, and long-term efficiencies”, but a review of local government funding is deferred to the next spending review. In other words, we remain in the dark about how social care will really be paid for in the long term. The introduction of a ‘cap and floor’ to limit an individual’s liability (while welcome for many reasons) will only make these pressures more acute as local government steps in to fill the funding gap.

There’s also nothing in the government’s plan about improving conditions for the social care workforce. The prime minister airily suggested in Commons that greater integration with health would bring greater esteem and a White Paper is promised, but this may not seem entirely satisfactory to care workers struggling to pay the bills right now.

This isn’t just a matter of fairness, it’s a fundamental issue of capacity. Across the country, care producers are struggling with staff shortages. You can’t have good care if there’s no-one to deliver it.

When it comes to good care, the government’s plan is clear that we need “a greater focus on delivering outcomes rather than processes.” This is important, but we’ve been talking about outcome-based commissioning in social care for over a decade and yet still the majority of care is purchased on a time and task basis. Why? And what can we do about it?

We know that the need for care is only going to grow. While it’s important to recognise that this challenge is not all about older people, there is a key demographic pressure: the ONS predicts that a quarter of the population will be over 65 by 2050 (compared to a fifth now). This will create a need for more care, but it will also require a shift towards prevention, helping people to live healthily and independently for longer.

That, in turn, means we need greater levels of integration, not just with health, but also with planning, housing, community development, leisure, built environment and a set of local services. The government’s plan stresses the need for prevention and for integration with health but has little to say about this wider care ecosystem.

All these problems are interconnected, of course. Underfunding creates market failure; market failure leads to a workforce crisis; and the two together mean there is no platform for service innovation.

It pleases the prime minister, no doubt, to see himself as a modern-day Alexander, cutting through this Gordian knot with a single stroke of his legislative sword, but many in the sector will remain anxious about the threads unravelling.

Jonathan Carr-West is Chief Executive of LGIU. This post was originally published at Public Finance. See more of our social care content


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