4. COMMISSIONING
4.1.11 Could the Department detail trends
in the Personal Social Services Pay and Price Index from 1997-98
and outline the assumptions behind the index? (Q37)
Answer
1. The Personal Social Services (PSS) Pay
and Prices index is set out in table 37 for the years from 1997-98.
2. The interpretation of this table is that,
for example, PSS pay and prices rose by approximately 4.5% between
April 2006 and April 2007. The average increase between April
1997 and April 2007 is 4.3%.
3. The Department of Health annually produces
the PSS Pay and Prices index, which is a weighted average of changes
in pay, prices and, in recent years, capital costs for the sector.
4. The index covers services for children
and adults and covers services directly provided by local authorities
and services purchased from independent sector providers.
5. The figures are not projections for the
future. Future allocations of resources for both health and social
care are subject to the conclusion of the next Spending Review.
6. Key assumptions underlying the estimates
for the period from 2002-03 are:
— Social services expenditure is divided
between staff costs (80%), capital costs (10%) and costs of other
inputs (10%), on the basis of various data and assumptions.
— Changes in staff costs are based on Annual
Survey of Hours and Earnings (ASHE) data on the hourly earnings
of staff groups working in social services (weighted by their
respective share of the pay bill).
— Changes in capital costs are assumed
to be in line with the BERR PUBSEC Tender Price Index of Public
Sector Building Non-Housing.
— Changes in the costs of other inputs
are assumed to follow the Gross Domestic Product deflator.
Table 37
THE PSS INFLATION INDEX
|
| Year | % increase over previous year
|
|
| April 1997 | 4.4%
|
| April 1998 | 4.1%
|
| April 1999 | 4.8%
|
| April 2000 | 3.3%
|
| April 2001 | 4.4%
|
| April 2002 | 4.4%
|
| April 2003 | 4.9%
|
| April 2004 | 4.3%
|
| April 2005 | 4.3%
|
| April 2006 | 3.6%
|
| April 2007 | 4.5%
|
| April 2008 | 3.7%
|
|
Source:
Social Care Strategy Unit, DH
DH calculations using data from:
ONS Annual Survey of Hours and Earnings 2003 onwards and New Earnings Survey for earlier years
HM Treasury's GDP Deflator http://www.hm-treasury.gov.uk/economic_data_and_tools/gdp_deflators/data_gdp_fig.cfm
BERR Tender Price Index of Public Sector Building Non-Housing
Personal Social Services Research Unit "Unit Costs of Health and Social Care Reports"
Laing and Buisson "Calculating a Fair Price for Care" (2008)
Footnotes:
1. The series is discontinuous between April 2002 and April 2003 as it uses the previous methodology for years to 2001-02 and revised methodology for years 2002-03 onwards.
2. The index for 2003 has been revised slightly to use an improved method of weighting.
3. All figures have been revised to take into account data revisions, but these have not changed the results.
4. This work contains statistical data from ONS which is Crown copyright and reproduced with the permission of the controller of HMSO and the Queen's Printer for Scotland. The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. This work uses research datasets which may not exactly reproduce national statistics aggregates.
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