Recommendation 15

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.