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Social care funding cut by £1 billion, NAO reports

A new report from the National Audit Office (NAO) says social care is still plagued by ongoing chronic workforce shortages, long waiting lists for care and fragile provider and local authority finances.

Social care has lost out on more than a billion pounds of funding promised by the government in December 2021 to reform the system, according to a new National Audit Office (NAO) report.

The report Reforming adult social care in England says that only £729 million may now be spent between 2022 and 2025 on reforming the adult social care system, representing a 58% fall in the budget. The rest has been diverted to other care priorities.

In 2019, the government promised to “fix the crisis in social care”. Following the Covid-19 pandemic, in September 2021 it published Build Back Better: Our Plan for Health and Social Care.

Yet, the NAO says the sector remains challenged by chronic workforce shortages, long waiting lists for care and fragile provider and local authority finances. Although there are some early signs of improvement in some of these, it remains to be seen whether these trends will continue and at what cost.

Gareth Davies, head of the NAO said: “Adult social care reform has been an intractable political challenge for decades. Government has set out its ambition to meet this challenge and now needs to demonstrate how it is delivering on these plans. If government is to successfully reform adult social care, it will need to manage some significant risks, including its own capacity and that of local government to resume charging reform activity alongside system reform.

“To maximise its chances of succeeding, government will need to ensure it understands the impact of its ambitions on local authorities and other stakeholders and establish a costed plan which ensures delivery of its long-term goals.”

Local variation in social care funding

Adult social care covers social work, personal care and practical support for adults with a physical disability, a learning disability, or physical or mental illness, as well as support for their carers.

As people live longer and with more complex conditions more people are likely to need adult social care to support them to live the lives they want. In 2022-23, local authorities in England spent £23.7 billion on adult social care, supporting more than one million people with care needs.

The Department for Health and Social Care (DHSC) reprioritised reform funding and activity to reduce delayed discharge pressures, but the report says rising inflation has compounded other long-standing pressures. For example, waiting lists have increased by 37% between November 2021 and April 2022.

At last year’s Autumn Statement, government postponed its £3.6 billion charging reform initiative and committed up to £7.5 billion to the sector, including £2.7 billion of new central government funding, to help ease immediate pressures.

Yet, the NAO says that there is local variation and funding may not be reaching areas that need it most because government has not updated the formula used to distribute most local government funding for adult social care since 2013-14.

Workforce plans and social care

Vacancies in adult social care in England have increased by 173% in the past decade and, despite a recent fall, stand at around 152,000 (a 10% vacancy rate). Around 70,000 staff have been recruited from outside the UK in the past year.

As there is no established an overarching programme to coordinate the reforms, making it difficult to know if it is on track to achieve its objectives, the NAO says DHSC is delivering on two of its eight workforce projects – supporting international recruitment and adult social care volunteering – the remaining six are in development.  Some projects within digital, data and assurance have made better progress.

It recommends that DHSC assesses the impact of its current and planned reform interventions on local authorities and seeks stakeholder views to ensure its plans are manageable. It should also set out a costed plan for implementing charging reform from October 2025, and map the funding required to deliver its planned reform outcomes.

Wake up call to government

The Health Foundation said that the report should be a wakeup call to government and political parties ahead of the general election. The social care system is in crisis. Older and disabled people are going without the care they need, staff vacancies stand at 1 in 10, and reliance on unpaid carers is high.

Lucinda Allen, Senior Policy Officer at the Health Foundation, said: ‘Successive governments have broken promises to ‘fix’ social care. The current government is no different, watering down its reform plans and delaying the introduction of a cap on care costs – leaving people vulnerable to potentially catastrophic costs. Money earmarked for reform is instead going towards immediate pressures on care services, continuing a legacy of short-termism in social care funding.

‘Fundamental reform of the social care system in England is needed to improve people’s access to care, boost pay and conditions for staff, and increase state protection against care costs. This will require additional funding. The Health Foundation estimates it could cost an extra £8.3bn a year by 2032 just to meet expected demand as our population ages. An ambitious government can afford to go further and improve our social care system – and stop history repeating itself.’

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