Counties set out their social care policy positions in new report ahead of government green paper

England’s largest councils have backed government plans to introduce a cap on care – but warn that it must be fully-funded otherwise it will inadvertently push services, care providers and councils closer to breaking point.

The recommendation for a fully-costed cap comes in a new report, ‘Sustainable Social Care: A Green Paper that Delivers a New Deal for Counties’, which sets out the County Councils Network’s policy positions on adult social care, ahead of the forthcoming government green paper.

The paper argues that if the government’s reform agenda is to be successful, then social care must remain a local service and ministers should ‘not be swayed’ by overly-simplistic arguments to combine all, or elements of social care into the NHS.

Download the report here.

With counties facing a funding gap of £1.6bn in social care by 2020/21 and new figures showing the average county authority now spends 45% of its entire budget on adult social care, the report makes several key recommendations to government:

• If government implements a cap on care at £50,000 per individual, this could cost county authorities collectively £691m a year – double that of a £72,000 cap which was previously put forward.
• County leaders suggest these reforms, and the funding gap, could be filled by national taxation and means-testing of winter fuel allowance and attendance allowance to avoid ‘catastrophic consequences’ for local services. Separately, they say they agree with the exploration of further proposals to make the system sustainable, including the recently floated ‘social care levy’ proposals.
• Social care must remain a local service, and social care councils’ role in the reform and integration agenda should not be overlooked by government. Councils contain democratic accountability and strong links to other service areas, such as housing, and they have a proven track record in financial prudence and commissioning.
• With the number of over 85s households in county areas set to rise to ‘unprecedented’ levels by 155% over the next two decades, government must address shortages in both retirement properties and supported housing, by introducing reforms to the planning system and to the administration of grant funding such as Disabled Facilities Grant.
• Prevention should be a key focus of the green paper. To that end, government should invest a ‘significant’ proportion of the £20bn NHS windfall in primary, community, and mental health services.

The government had been poised to introduce a £72,000 cap in 2014 before it was postponed. The 2017 Conservative Manifesto dropped its commitment to the cap, but they have since restated their commitment to the policy and it is expected to form part of forthcoming proposals.

However, the lower the cap is set, the higher the costs for county authorities – and with county authorities already facing an existing funding black hole of £949m in social care by 2020 and care home providers in these areas estimating a short-fall of £670m in the fees they receive from councils, the introduction of an un-costed cap would have ‘catastrophic’ consequences for local services; pushing services closer to the brink, fewer residents actually receiving care, and care homes potentially closing.

These councils also say that a failure to fully fund any care cap, and provide genuinely new money to meet the existing funding gap of £1bn, will further threaten the financial sustainability of England’s largest councils. A CCN survey of county leaders recently showed that only 33% of leaders were confident in delivering a balanced budget by 2020/21; with the outcome green paper pivotal to dealing with the financial uncertainty facing their councils.

The report presents evidence that shows the consequences of an unfunded cap for rural councils could be particularly acute, with counties facing an ‘unprecedented’ rise in those aged over 85 and these areas containing more ‘self-funders’ who would now, for the first time, be eligible for the cap and potentially enter state-funded care.

Population projections show that the number of over 85 households in county areas are set to balloon by 155% by 2039, rising from 491,000 to 1,254 million. This growth in rural areas represents over half of the country’s entire projected growth in over 85s, with on average 53% of social care users in counties self-funding their care.

In a CCN survey of county leaders undertaken to inform the report’s recommendations, social care cabinet members, or directors, have argued that increased national taxation should be part of the financial solution. The results found that just 6% of respondents believe that a national insurance rise would be ineffective; and just 14% believed that an increase in income tax would be ineffective. Separately, the report argues that Ministers should urgently review universal benefits to help fund social care services, such as winter fuel and attendance allowances.

County leaders also said they agree with the exploration of further proposals to make the whole system more sustainable. In recent weeks, the government has floated the idea of a social care levy, where people save into a new insurance fund that could pay for any care they need; with a final lump sum paid upon retirement.

Cllr David Williams, County Councils Network spokesman for health and social care, and leader of Hertfordshire County Council, said:

“County areas are withstanding some of the greatest financial and demand-led pressures in delivering and procuring social care services, and have had some of the biggest cuts in core government grants since 2010. These pressures will only continue to intensify in the coming years, with counties home to the largest and fastest-growing elderly populations, and they already spend close to half their budgets on social care services.

“Faced with these current pressures, and an elderly population that is projected to increase to unprecedented levels in rural areas, financial reform for the system and protection for individuals from huge costs are necessary. That is why we are backing a cap on care cost contributions – but this must be fully-costed for local authorities, otherwise it will have catastrophic consequences as it push under-pressure social care services to the brink of collapse.

 “This report today sets out policy proposals for government ahead of the social-care green paper. The status quo is no longer an option; ministers must be bold in ensuring sustainable financial reform. With care services and the NHS interdependent investing in one but not the other is financially irresponsible.

“Above all, social care must continue to stay a local service and ministers should not be swayed by overly-simplistic arguments to combine all, or elements of social care within the NHS. The challenges local government has faced in delivering balanced budgets whilst ensuring that those most in need receive high-quality care must not be underestimated – without the leadership and innovation shown at a local level, the present situation could have been a lot worse.”

Notes to editor

• CCN is the national voice for England’s county councils. It represents all 27 county councils and 9 county unitary authorities. Collectively, they represent 26 million people, or 47% of the country’s population. It is a special interest group of the Local Government Association. For more information, visit countycouncilsnetwork.org.uk.
• Download the new report, Sustainable Social Care: A Green Paper that Delivers a New Deal for Counties, here.
• The government’s cap on care, first proposed in 2014, aims to limit the total amount an individual pays for their care costs. It was dropped in 2015, and did not make last year’s Conservative Manifesto; but the government has strongly indicated that it will be part of the forthcoming green paper.
• Analysis undertaken by leading consultancy LaingBuisson for CCN in 2017 and included in the report on page 16 estimated the cost of the cap on care as rising to £691m annually in CCN member councils. For more details the full LaingBuisson study can be downloaded here https://www.countycouncilsnetwork.org.uk/download/1179/
• A CCN survey in 2015 estimated the average level of ‘self-funders’ (non-local authority social care clients) as 53%. A report for LaingBuisson (2015) for CCN showed that introducing a cap on care could further harm the profit margins of care homes, as with greater price transparency this would mean more ‘self-funders’ trying to negotiate rates closer to what the local authority pays. Whilst greater price transparency and equalisation is desirable, it could have the effect of destabilising the care market, which is propped up by ‘self-funders’ paying significantly more than local authorities. For more information, the 2015 LaingBuisson report can be downloaded here https://www.countycouncilsnetwork.org.uk/download/122/
• The £1.6bn funding gap figure used in this press release is the total sum of;
• Budget Gap: A 2017 budget survey by the Society of County Treasurers for CCN estimated that due to service and demographic pressures in county authorities they would face a budget gap in social care of £ £949m by 2020/21. For more details see CCN’s Autumn Statement submission (p. 6) https://www.countycouncilsnetwork.org.uk/download/1185/
• Care Market Fee Gap: The £670m market fee gap is the difference between the ‘true’ cost of care as benchmarked by LaingBuisson and the amount the 36 county authorities collectively pay. In 2017/18 figures show that on average ‘self-funders’ pay 43% more for care than the local authority in county areas per week; this is because counties are not in the financial position to pay more. The full report by LaingBussion for CCN can be downloaded here https://www.countycouncilsnetwork.org.uk/download/1179/
• The population figures used in this release are analysed from household projection figures up to 2039:

• The survey results featured in this press release are anonymised and were undertaken to inform the final report’s recommendations.