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Adult Social Care - 15 minutes of fame

15 December 2016

If the silence on social care was deafening in the Autumn Statement – the Local Government Settlement certainly turned up the volume on the issue. In order to ensure that the issue was sufficiently covered, the Secretary of State asked for a full 15 minutes, rather than the usual 10, to address the settlement and the bulk of this focussed on adult social care. Secondly and perhaps in reflection of the final shake around and a few surprises, they were only able to provide the statement to the opposition 15minutes before the secretary of state spoke. So let’s explore what that 15minutes had to say about the future….

What were the headline's  coming out of this statement?

Precept changes – As heavily trialled this week, the local government settlement included additional flexibility for local councils to increase their council tax by up to 6% over the next two years.  This could be managed via a 4% increase in 2017/18, 3% increase in both 2017/18 and 2018/19, or a 4 % increase in 2018/19. Or some combination of the above – which at the end of 2018/19 meant that the amount associated with the precept had not increased by anymore than 6%. Government calculations as to the increase funding this might bring into the sector suggest an increase of £208m in 2017/18 and £444m in 2018/19. Clearly there are huge concerns about the ability of local authorities in more deprived areas of the UK to raise anywhere near enough to meet the funding gap in their localised services, and much of this was expressed in the ensuing debate.
The ‘new’ news in the settlement related to a change to another source of local government funding, taking it out of one part of the system, and ringfencing it nationally for social care.

New Homes Bonus reform – The surprise announcement from the Secretary of state arose from a reform to the New Homes Bonus. This has been in place for local authorities to promote house building. There has been an ongoing consultation about this reform, and the government today announced that it would be reducing the payments to local authorities for new homes from 6 years to 5 years, in the new financial year, and then further reducing this from 5 to 4 years from 2018/19. He then announced that the savings in 2017/18 (and only in this year, as far as I could tell) would be saved for local government and ring fenced nationally to pay for social care in the areas of most need. There was not clarification of how this might work, but the more optimistic might assume that this would take account of the ‘postcode lottery’ implications of trying to raise funding through council tax, and that the money would flow to areas least able to generate additional revenue in this way. The less optimistic might say – the devil is in the detail – and in my experience – they would be right. However, the calculations from the savings from this in 2017/18 are that this raises an additional £240m of new money for social care (whilst of course, taking it away from local authorities new home bonus).

So – how do the sums add up?

The Secretary of State was clear to announce that this meant that over the next two years, there was an additional £900m of new funding available for adult social care. The only way that this appears to add up from the figures suggested by him is that there are two years of precept additional funding, and then presumably it will revert to the 2% figure, and there is only one year of new homes bonus money.

In addition to this, he announced that there would continue to be government focus on what would make social care and health integration more effective. He quoted statistics in relation to the variability of delayed discharge – and announced that in response to that there would be a new Integration and Better Care Fund Framework produced in the New Year. I think this is likely to be building on some of the work that SCIE was involved on earlier in the year, looking at what are the key markers of integration, but more detail on this will need to follow.

Finally, he focussed on what the future of local government funding might look like, and how we will be moving important steps closer to this over the coming year. The reform of local government funding is seen as the final steps towards localism, enabling local authorities to retain 100% of their business rates with a view to better determination of local spend. He announced a review into Fair Funding Review, which will look at issues including changing demographics, and determine a more upto date allocation basis for the future. Some of this approach will be being developed through pilots of the devolved areas including London, Greater Manchester, West Midlands and more.  This will most definitely be one to watch.

Therein lies my analysis of the local government settlement, and some of the interesting ensuing discussion. If you have any comments or corrections to my interpretation, then do let me know. There is sufficient rhetoric within the statement and the various responses to indicate that this is an issue that has risen higher up the government’s agenda, and it will be up to all of us to ensure that we make the most of our 15 minutes of fame.

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