Social care and the spending review

Annie Gunner Logan, CCPS Director

In the run-up to yesterday’s Autumn Statement and Spending Review, our colleagues south of the border mounted a strong campaign under the banner of the Care and Support Alliance (CSA) to raise the profile of social care.

Twitter users will have seen the #carecrisis hashtag featuring in their timelines; campaign leaders made regular appearances on UK TV and radio; meanwhile there was an impressive array of signatories from the public, third and independent sectors appended to a letter sent directly to the Prime Minister explaining the need for urgent action.

This morning, the verdict on the Spending Review from those colleagues is damning: “Chancellor fails social care test”.

The CSA puts it fairly bluntly: “The Conservative government was elected on a promise to invest £6bn into social care by 2020. Today’s announcement suggests that the maximum amount the government can hope to raise for social care is under £2bn and even this figure is not guaranteed.”

The care crisis, in England, looks set to continue.

Decisions about social care funding are, of course, devolved to Scotland: but that doesn’t mean there are no implications for us from yesterday’s announcement. Three key elements warrant closer analysis.

First, the Chancellor’s headline initiative on social care was to allow local authorities to raise an additional 2% in council tax, this ‘precept’ to be used exclusively for adult care services. This, he said, will raise up to £2bn.

What the Chancellor has done here, in effect, is to transfer responsibility for plugging the social care funding gap from central to local government. This means that there will be no ‘consequentials’ for the Scottish budget arising from the increase in funding (assuming that an increase materialises – a matter about which the CSA seems fairly doubtful, with good reason).

What this initiative is likely to do, however, is to increase pressure on the Scottish Finance Secretary to consider the introduction of a similar measure: this would mean putting an end to the eight-year freeze on Council Tax, which is of course extremely popular with voters. And to do this just a few months before the Scottish Parliament elections.

Second, the Chancellor allocated an additional £1.5bn for social care to the ‘Better Care Fund’, which (to use shorthand) is the southern equivalent of our own health and social care integration project. The CSA is concerned that all this money will be channelled into the NHS in the first instance, with the strong risk that it will be swallowed up by acute services with precious little left for social care.

If these concerns sound familiar, it’s because they are: in Scotland, we have seen successive multi-million pound ‘Change Funds’, allocated to NHS Boards, used up long before they’ve reached most voluntary sector care organisations.

Third, according to reports published yesterday, the overall Scottish budget is set to shrink by 5% over the next five years. Given that the Scottish Government has already made a series of costly commitments to education, childcare and the NHS, any remaining ‘unprotected’ areas will have to bear the brunt of cuts to be made. For our purposes, this includes local government, still the major funder of social care.

Thus whilst the CSA may well have its head in its hands this morning, the prospects for social care in Scotland may not be much rosier. The irony – if you can call it that – is that part of the reason why social care is under such pressure is the Chancellor’s own announcement, only four months ago, of a new ‘National Living Wage’.

All staff working in care will have to be paid a minimum of £7.20 an hour from next April: this is set to rise to £9 by 2020. Let’s make no bones about it: for low-paid employees, this is very good news indeed. However the impact of years of competitive tendering, ‘efficiency’ savings and austerity-related budget cuts have combined to push pay in social care well below these levels in many organisations.

It now looks as though care providers – in England, at least – will be left to make up the difference between what they pay now, and what they will have to pay in 2020, entirely on their own. Many of them are being fairly upfront about the prospect of major business failure in these circumstances.

Meanwhile the Scottish Government, quite rightly, wants us to aspire to greater things than statutory minimums for social care staff. The recently-published Fair Work guidance demands that care providers are quizzed in tender documents about whether they pay the (real) Living Wage, alongside a whole range of other progressive workplace policies; and that this should put them in a better position to win contracts.

The fact of the matter is that providers in our sector desperately want to improve terms and conditions for staff: but they can only do this if contract values are sufficient to cover the associated costs.

CCPS has been involved in a series of initiatives led by the Scottish Government to address these issues head-on. We’ve only got three weeks to go until Mr Swinney stands up in the chamber at Holyrood to announce his own spending review: we will be looking to him to ensure that resources are made available to enable us to carry on working together for better social care, and better pay for the people who deliver it.

Care providers will certainly be keeping their fingers crossed that he takes the future of social care a lot more seriously than his Westminster counterpart did yesterday.


Yvette Burgess, Director of the CCPS-hosted Housing Support Enabling Unit, adds:

When it comes to housing, the Chancellor’s statement steered clear of the feared 10% cut across all Housing Benefit entitlement.  That was good news.

He is capping entitlement, however, to private sector rent levels which tend to be higher than social rent levels.  Again, that sounds like good news.  The bad news is that supported housing will be included in this policy and we know that the rent levels for some supported housing are higher than private sector rent levels because of the additional costs landlords face.  This is a concern.

The Chancellor’s statement indicates that provision will be made for this shortfall but at a local level and on a discretionary basis through Discretionary Housing Payments (DHP). There is no guarantee that the additional funding for DHP will cover the full shortfall or for how long.  It will be local authorities rather than the DWP that will be left to make decisions about assistance to claimants in supported housing where the rents are higher than the capped levels.

This all leaves some of the most vulnerable in society with reduced entitlement to assistance with housing costs from April 2018.