Austerity is over, and Britain expects a budget that
Well, so the papers tell us, although I suspect most people
had a more measured set of expectation about what the Chancellor would be able
reveal in his announcements today. The ongoing negotiations around Brexit
almost certainly guarantee that in reality – deal or no deal – we will see some
sort of new financial plan having to be enacted in the new financial year. The
deal scenario might enable us to have a revised budget with a bit more bounce,
and the no deal picture may involve a wide range of contingency measures to
balance out economic shocks to the system….
However, what news has the budget brought and how will it impact on social
care and those working within the sector?
There was a great deal of leaked news about this budget, and
of course, the announcements earlier in the year in relation to NHS spend
levels, meaning the elements of surprise were not in abundance. Over the
weekend a story emerged in The Times and
The Guardian about increased funding
for social care, with a figure of between £800m to £1bn quoted.
Whilst it was
good to see that this prediction partially came true, the final announcement of
£650m for social care doesn’t go anywhere near the shortfall in social care
funding recognised by a wide range of bodies including ADASS, LGA and the Care
and Support Alliance (of which NCF are members).
The fact this appears to be new money going directly to
local authorities is positive. However, with credit to the Kings Fund for its
detailed reading of the treasury papers, it appears although only £240m of the
£650 is ring-fenced for adult social care, the rest to be spread across all
social care – including children’s services.
This does, of
course, mirror the short term cash injection of £240m ‘in year’ into social
care, but this announcement made at the Conservative Party conference was very
explicitly linked to discharge and again, bears no resemblance to the level of
funding gap that currently exists in social care.
There remains the long-term commitment to the social care
green paper, which is intended to focus on long term funding solutions. However,
the current grasp of both the level and immediacy of the shortfall does not
provide much encouragement. It is imperative any green paper will need to accurately
reflect the current requirements as a minimum baseline to go forward from
Of course, the government will want noted they have injected
an additional £240m ‘in year’ into social care, but this announcement made at
the Conservative Party conference was very explicitly linked to discharge and
again, bears no resemblance to the level of funding gap that currently exists
in social care.
There were a number of other elements of the budget that
will have a significant impact on both the workforce and the people that care
There has been growing pressure on the Chancellor to put
more resources into the roll out of Universal Credit. The commitments outlined
today highlight the pressures this system is under, with specific money for
transition, and in addition a further £1.7bn to Universal Credit payments. If
the funding is targeted in the right way and the roll out of this massive
change programme for the welfare state continues, it will provide much needed
support for increasing numbers of the most vulnerable working age adults that
are in receipt of care and support, alongside those working within the care
sector and in receipt of essential benefits.
The budget also reinforced the anticipated rise in national
living wage, up an additional 4.9% from £7.83 to £8.21 coming into effect in
April 2019, alongside rises in both the personal allowance and the higher rate
In addition, the budget highlighted increased spending on mental
health, heralding a £2bn investment in a ‘new mental health crisis service’. It
is interesting to reflect on the window this offers into the complicated set of
negotiations happening behind the scene in relation to the NHS 10 year plan. Reports
have suggested this is an early indicator that mental health services will
benefit disproportionately from the NHS 70 year birthday funding announcement.
We will have to wait until the 10 year plan to see exactly what
this additional funding is due to do, and how much of it might benefit people
in receipt of care via enhanced community services – for example.
The tax relief on small businesses, whilst having limited
impact on social care providers, will potentially have a knock on impact on
local authority finances. In 2020, local government funding makes the
transition from central government grant funding to one based partly around
local authority’s ability to raise revenue through business rates. The risks
around this approach for social care were highlighted in an IFS report in March
this year, and my blog at the time focussed in on these risks
Whilst we may not have seen any rabbits pulled out of the
Chancellor’s hat in today’s budget, we may just have seen another magic trick
via some effective sleight of hand; as the chancellor gives to social care with
one hand, whilst simultaneously removing future local authority revenue raising
powers with the other.
So where does social care stand? It is worth taking a moment
to consider the same budget that gave social care £650m, gave pothole funding
£420m. It is clear this Chancellor has an eye for patching up the holes in all
sorts of public services – although he must recognise this approach is
expensive, repetitive and - like the holes in the road - subject to extreme