Social Care Reform Funding
Background
In December 2021, the government published its People at the Heart of Care white paper which outlined a 10-year vision for the reform of social care. £5.3bn worth of funding was assigned to meet a number of pledges over three years and included what you can see in the table to the right.
In November 2022, the Chancellor’s Autumn Statement delayed the charging reforms until after the next General Election, and reassigned the money related to the fair cost of care and charging reforms to the local government settlement, split between adult’s and children’s social care, as well as various discharge funds:
- £1.265bn of the £2.2bn charging reform money has been split between adult’s and children’s social care in The Social Care Grant in the Local Government Settlement for 2023/24. It’s not clear what has happened to the remainder of the £2.2bn.
- The fair cost of care, has been diluted with only £486m of the £1.36 being given being given to LAs for its original purpose split across 2022/23, 2023/24, 2024/25. The local government settlement appears to have combined the £162m for 2023/24 with a new £400m ringfenced fund – we’re not sure where that money has come from. Grant conditions can be found at this link.
In April 2023 the remaining £1.7bn set aside for wider system reforms was also reduced as part of the government’s new ‘next steps to put people at the heart of care‘ plan. Of the £1.7bn originally assigned, only £572m is actually committed over the next two years. The government claims it will use up to £700m (including the £572m) over the next two years, with an additional £600m they are holding back to invest in discharge measures. The money committed comprises:
- At least £250m for workforce reforms (but the wellbeing aspect has been removed).
- Over £100m for digitising social care
- Up to £50m to encourage better personalised care by strengthening insight and joining up care through better data and local authority assurance.
- At least £35m for a new Innovation and Improvement Unit in DHSC.
- An additional £102m to increase the level of housing adaptation support available in local areas
- Up to £35m to support joining up services for people and unpaid carers
Our response can be read here.
Fair Cost of Care Reports and Market Sustainability Plans
As part of the charging reforms, DHSC set up a Fair Cost of Care and Market Sustainability Fund which funded LAs to run ‘fair cost of care’ exercises with care homes for over 65s and home care for over 18s, over the Spring and Summer of 2022 as well as money to help LAs move towards ‘the fair cost of care’ as flagged by these exercises. Originally, £1.36bn over three years was allocated to do this, but with the delay to reform, this has been reduced to £162m for each year 2022-2023, 2023-4 and 2024-25. However, the exercises did take place.
On 1 February 2023 LAs published their Fair Cost of Care Reports, outlining the median costs of various types of services. The map below allows you to find your LA’s Report. Our analysis in conjunction with the Care Provider Alliance shows that in 2021/22, the government paid at least £2.88 billion less than the actual cost of delivering care to people in their own homes, and in care homes for those aged over 65.
On 27 March 2023, LAs published their Market Sustainability Plans, outlining the measures they will take to move towards the fair cost of care and ensure care markets are sustainable. We are in the process of analysing these.
The Fives Tests for a Fair Cost of Care
The NCF has long campaigned for a Fair Price for all types of care, one that meets the true cost of good quality, sustainable care.
The current system puts a huge burden on those who need, and are required to pay, for their own care and support under the existing means-testing arrangements. This has created and sustains a fundamentally unfair situation where people paying for their own care cross-subsidise the state.
We have set out five clear tests that must be met in the creation of the Fair Price for Care. Ultimately, a true Fair Price for Care needs to be met by the state when commissioning care on behalf of people and this, in turn, will enable providers to rebalance the prices paid by individuals who fund their own care and create a sustainable care offer for the future.
The current combination of unfair cross subsidy and uncertain commissioning approaches that don’t cover costs undermines the long-term financial sustainability of care providers. The Fair Price for Care offers a prize to address this – failure to do so will simply compound the current market instability and market failure risks and will undermine the whole ambition for social care reform for all those who draw on care and support services.
This will enable care providers to pay staff in line with the skills and expertise they bring, at levels commensurate with other sectors and enable more professional development and clear career pathways. Failure to do so will compound the existing, systemic workforce pressures in social care and inevitably, workforce pressures across the wider health & care system.
Failure to do so will undermine the whole ambition for social care reform for all those who draw on care and support services.
The adult social care white paper is strong on innovation and technology ambitions – these will only be realised with a Fair Price for Care that reflects changing needs and requirements of the future.
Not-for-profit care provision ensures that all of the funding from either government or citizens is directed towards the delivery of care now and in the future, ensuring that the money remains in the sector and is reinvested to improve the quality of care. This will help to give politicians and the public reassurance in their investment in social care and kickstart the move to a longer-term strategic commissioning approach to grow the NFP care & support sector.
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