Source · Select Committees · Housing, Communities and Local Government Committee
Recommendation 15
15
Accepted
Paragraph: 74
We recognise the benefits of raising a proportion of funding for adult social care locally.
Recommendation
We recognise the benefits of raising a proportion of funding for adult social care locally. As we have argued in previous reports, we support greater fiscal devolution. In finding the right balance of funding sources for adult social care, however, we are concerned by the increasing reliance on locally raised tax revenue as currently constituted. In our previous report on local authority financial sustainability and the section 114 regime, we recommended a variety of ways in which the mix of funding to local authorities could be improved, including: resetting business rates, implementing the Fair Funding Review, 75% business rates retention with additional funding put towards an equalisation grant, and revaluing council tax. For this inquiry, we heard that the amount that areas can raise through council tax is not related to need: often the places with the lowest income from council tax have a higher proportion of adults who are eligible for state support for their care. We also recognise that the decision to raise social care precept will become a harder sell for councils when residents have already seen their National Insurance Contributions increase to pay for health and social care. In deciding how much additional funding to provide from the centre for adult social care, the Government must proceed with the aim of rebalancing the sources of funding so there is not such a reliance on council tax.
Government Response Summary
The government states that overall funding for health and social care will be maintained at the same level as if the Levy was in place, and that savings from delaying implementation of charging reform will be distributed via the existing Social Care Grant that supports local authorities to meet the current pressures in social care.
Paragraph Reference:
74
Government Response
Accepted
HM Government
Accepted
In December 2021, People at the Heart of Care was published, setting out the government’s 10-year vision for adult social care. These reforms were to be funded by the announced Health and Care Levy, which has since been repealed, but overall funding for health and social care will be maintained at the same level as if the Levy was in place. Part of the £5.4 billion was to implement charging reform, but as mentioned above we have taken the difficult decision to delay implementation, £1.3 billion in 2023–24 and £1.9 billion 2024–25 in savings from this decision will be distributed via the existing Social Care Grant that supports local authorities to meet the current pressures in social care. We are also creating a new grant worth £1.4 billion (£562 million in 2023–24 and £845 million in 2024–25) to support market sustainability and improvement. This grant is a combination of new funding confirmed in the Autumn Statement, and £162 million in each year of funding previously earmarked in our reforms for supporting local authorities to move towards paying a fair cost of care. 22 Government response Our Next Steps to Put People at the Heart of Care plan sets out how we are investing £700 million in reform, and when the public will see the results of our investment. These key system reform commitments include: • at least £250 million for workforce recognition and career development • £102 million for supporting people to remain independent at home • over £100 million for digital transformation in adult social care • up to £50 million for better insight and join up of care through stronger data and local authority assurance • at least £35 million for innovation and improvement • up to an additional £25 million to support unpaid carers • £15 million to support international recruitment • at least £3 million to support volunteers and the people who work with them Of the £1.7 billion the white paper committed to reform, up to £600 million remains to be allocated, which will be invested over the next two years after we have drawn on lessons learned from our investment in improving discharge. This will make sure we are effectively targeting the areas that matter most to people. Conclusion 21 – working across government Conclusion 21 - Given how fundamentally social care policies made by DHSC affect local authorities’ capacity, budgets, and residents, it is vital that DHSC and DLUHC work together closely on developing and delivering such policies. We were struck by the discrete division of answers to questions by Ministers, who rarely supplemented one another’s answers, and the separate follow-up letters that we received.