Council tax precept fails to close adult social care funding gap

Posted on July 13th, by geoff in Caring Times. Comments Off on Council tax precept fails to close adult social care funding gap

Levying extra council tax to pay for social care has failed to raise enough money to cover the cost of the new National Living Wage (NLW), let alone address the huge shortfall in funding in the face of increasing demand, a survey of all 151 adult social services directors in England has found.

Research published today (Wednesday, 13th July) by the Association of Directors of Adult Social Services (ADASS) highlights that the precept, introduced in the Autumn Statement 2015 to give councils the option to raise council tax by 2% for adult social care, will generate less than two thirds of the more than £600m needed to cover the NLW this year.

That means that this year, directors are left with a gap to fill of around £940m just to keep services operating at last year’s levels.

ADASS president Harold Bodmer said councils were working hard to protect adult social services budgets, with adult social care accounting for 35% of council spending for the third year running.

“However, with more people needing support and having increasingly complex needs, the impact of the welcome national living wage, and other cost pressures, fewer people are getting help, and councils are having to make reductions which will impact on people who receive care,” said Mr Bodmer.

“More money needs to be invested in prevention to reduce future demand, but with funding under such pressure and diverted to those with greatest and immediate need – those that we have a statutory duty towards – the opportunity to do that is being taken away.

“We have been arguing for some time now that adult social care needs to be given the same protection and investment as the NHS. Services are already being cut, and the outlook for future care is bleak. We’re at a tipping point where social care is in jeopardy, and unless the Government addresses the chronic underfunding of the sector, there will be worrying consequences for the NHS and, most importantly, older and disabled people, their families and carers.”

The overall budget for adult social services has risen slightly from last year due to the precept, from £13.65bn to £13.82bn, but there is wide variation between individual councils, with 70 of 151 reporting a fall in budgets. 62 councils needed to draw on reserves last year to fund budget shortfalls, while 52 had to cut services to balance budgets. The precept also raises the least amount of money in the areas of greatest need, intensifying budget pressures.

The survey also found that more people in need were being affected by the crisis in social care funding:

  • Despite a 3% increase in the older population, there has not been a corresponding rise in people receiving care;
  • At least 24% of the £941m (7%) savings that adult social services directors will be expected to make this year will come from cutting services or reducing personal budgets;
  • 80% of directors reported that care providers – both care home owners and homecare providers – were facing financial difficulties and closing care homes or handing back contracts to councils, affecting thousands of people, despite 82% of councils increasing fees to providers.

The survey was carried out before the referendum on the UK’s membership of the European Union, which left many questions unanswered about how different services will be affected in the future – including adult social care.

“ADASS will be closely monitoring the potential impact of the referendum result on the economy and funding of adult social services, and we’ve extended our support to the 80,000 EU staff who are providing care to people right across the country, every day,” said Mr Bodmer.

“While these may be uncertain times, the most important thing to remember is that people’s needs for care won’t stop. We still have a responsibility to make sure people are getting the support they need to live independent, valuable lives, and to plan ahead as best we possibly can.”

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