Draft Care and Support Bill - Joint Committee on the Draft Care and Support Bill Contents

2  Implications of the Dilnot Report and the Government's proposals

16.  In July 2010 the Government announced the establishment of an independent Commission on Funding Care and Support (the Dilnot Commission) to make recommendations on how to achieve an affordable and sustainable funding system or systems for care and support, for all adults in England, both in the home and other settings. The Commission reported in July 2011 making ten recommendations:[17]

  • a cap on an adult's lifetime contribution to their care costs set at between £25,000 and £50,000 with an improved national deferred payment scheme;
  • increasing the upper means test threshold for state support from £23,250 to £100,000;
  • those who enter adulthood already having a care and support need should immediately be eligible for free state support to meet their care needs;
  • universal disability benefits for people of all ages should continue as now;
  • people should contribute a standard, fixed, amount to their general living costs, such as food and accommodation, in residential care;
  • eligibility criteria for service entitlement should be set on a standardised national basis to improve consistency and fairness across England, and there should be portability of assessments;
  • encourage people to plan ahead for their later life with a Government awareness campaign to inform people of the new system;
  • a statutory duty should be placed on local authorities to provide information, advice and assistance services in their areas;
  • support the proposals set out by the Law Commission to give carers new legal rights to services and improve carers' assessments;
  • review the scope for improving the integration of adult social care with other services in the wider care and support system.

The Commission also said that, in the short term, they thought it was reasonable for a minimum eligibility threshold to be set nationally at "substantial" under the current system.

17.  After a year of deliberation the Government published their progress report on funding reform in July 2012, accepting many of the Commission's recommendations, but leaving open final decisions on the two key recommendations of a cap on lifetime care costs and an increased means test. In other chapters of this report we comment and make recommendations on the provisions in the draft Bill covering information and advice, integration, eligibility, and carers' assessments.

18.  When we began our work the Government had not announced how they intended to take forward the support in principle they had given to a cap on lifetime care costs and increased means test. This has hampered our ability to test the draft Bill's compatibility with a capped cost system.

19.  The Secretary of State for Health set out the Government's plans in a statement to the House of Commons on 11 February. He told the House: "We propose to introduce a cap on an individual's financial contributions towards the cost of care and a significant increase in the level of assets a person may hold and still receive some degree of support from the state."[18] The Government confirmed that a cap will introduced and set at £61,000 in 2010-11 prices, or £75,000 once it is introduced in April 2017. It was also confirmed that the amount of assets a person can hold and still receive financial support for their residential care costs will rise from £23,250 to £100,000 in 2010-11 prices, or £123,000 when introduced in 2017. The arrangements for young people who already have care needs when they turn 18 were also confirmed. They will now receive free adult care and support when they reach 18. People who develop a care need after 18 but before state pension age will be protected by a cap that is below the £75,000 threshold.

20.  To help the Committee examine the implications of the Government's decision to implement a capped cost scheme the Department of Health published a policy statement on care and support funding reform. Officials also briefed and took questions from the Committee.


21.  We asked officials to set out how the Government intended to determine the level of the cap for working age adults. At the time we concluded our work the details were not available; however we note that the Government intend to take a power to enable the Secretary of State to be able to set this out in regulations. Regulations determining the level of the cap for working age adults should be subject to affirmative resolution.


22.  Whether a person qualifies for state support towards their care costs hinges on having eligible needs. We comment in Chapter 5 on the need to redraft clause 13 to reflect fully the Government's policy intention of setting a national eligibility threshold. The Dilnot Commission also said that "It is our view that there are problems with the current FACS[19] scale, and we believe that it should be replaced in the future with a more objective scale - one which can be the basis of a clearer, fairer and more coherent social care system."[20] We endorse the recommendation made by the Dilnot Commission that the Government should act quickly to devise a new assessment scale in conjunction with service users, carers and other interested parties. This work needs to proceed at pace. Draft regulations should be published before Second Reading to support Parliamentary scrutiny of the Bill during its passage through both Houses.

23.  We are glad that during our oral evidence session with Ministers we were told by Sally Warren, the Director of Social Care Policy at the Department of Health, that "We are intending to publish draft regulations on eligibility so people can understand how we see eligibility working. We want to publish that as the Bill progresses through Parliament. The idea would be that, as Parliament was considering the primary legislation, they would understand how it would apply in secondary legislation, because it is so key to how the rest of the system works."[21]


24.  Under the Government's plans those with eligible needs but who fail or decline the means test will have the value of their support metered, so that when they have been exposed to a certain amount of cost the State can step in. After considering the options[22] the Dilnot Commission recommended using a notional amount that reflected the cost of meeting eligible needs. As we discuss in Chapter 4,[23] it is essential that the way in which local authorities determine what they will pay reflects the actual cost of meeting eligible needs.

25.  The way in which notional costs will be calculated has not yet been confirmed by the Government. However the policy statement says: "the local authority would be required to provide the person with a personal budget, which sets out the amount which is calculated to be the cost of meeting their eligible needs."[24] It goes on to say: "the personal budget would be ascertained by examining the individual's eligible needs and assessing what the cost of meeting those needs would be, if the local authority were to do so—or "notional cost" of meeting the adult's needs."[25]

26.  When we asked officials how the notional costs might be calculated, they described to us the existing practice of many local authorities of using resource allocation systems (RAS) [26] to help them to determine how much money a person should get in their personal budget to meet their needs. It seems likely that some form of RAS will become the means by which notional amounts are calculated.

27.  Acting on a recommendation of the Law Commission, the Government are placing personal budgets on a statutory footing for the first time in clause 25 of the draft Bill. The clause requires the personal budget to include an assessment of the costs of meeting eligible needs. However the clause is silent about how that assessment is to be conducted. This is where RAS comes in.

28.  Government policy on RAS can be found in a 2008 Local Authority Circular, which said: "In the future, all individuals eligible for publicly-funded adult social care will have a personal budget (other than in circumstances where people require emergency access to provision); a clear, upfront allocation of funding to enable them to make informed choices about how best to meet their needs, including their broader health and well-being."[27] This was then developed further in guidance issued in 2010.[28] That guidance stated: "The aim of the RAS should be to provide a transparent system for the allocation of resources, linking money to outcomes while taking account of the different levels of support people need to achieve their goals. It allows people to know how much money they have available to spend so that they can make choices and direct the way their support is provided." The guidance goes on to say that this "should not detract from a council's duty to determine eligibility following assessment and to meet eligible needs"; and it is "a means of giving an approximate indication of what it may reasonably cost to meet a person's particular needs according to their individual circumstances." Critically the guidance concludes by stating that "However councils choose to develop systems for resource allocation, the first principle underpinning such systems should be transparency. Working towards greater transparency of resource allocation represents the first stage in a longer-term process to support the delivery of a more equitable system for all groups of service users based on need."

29.  The Law Commission made its recommendation that personal budgets should be placed on a statutory footing because of what it described as a "confusing structure, whereby social care practice is not founded in the legal framework." It went on to express concern that some assessment procedures for personal budgets and the RAS were not compliant with the law. In responses to the consultation a number of consultees argued that RAS should be placed on a statutory footing to ensure greater oversight and transparency in the way they are set and operated. [29] During our inquiry Richard Humphries of the Kings Fund told us: "we have begun to move in a way towards to a cash-based algorithm through personal budgets, but we are doing it through 152 different resource-allocation systems in local authorities. We actually have quite a muddled position at the moment."[30] We agree.

30.  Both eligible needs and RAS are already highly contested areas of policy and practice (a matter we return to in paragraphs 202-204). With the extension of the duty to meet the needs of self-funders on their request, the introduction of national eligibility and portability of assessments and care accounts, there will be a clear need for transparency and predictability in determining notional costs. The introduction of a capped cost scheme, which will result in many more people being assessed and entitled to a personal budget, is likely to lead to an increase in disputes and legal challenges. We are not confident that Ministers have yet fully thought through the implications for local authorities of these changes.

31.  In particular we believe that the arrangements for redress and complaints resolution must be reviewed to ensure that they are fit for purpose. We discuss this further in Chapter 7.

32.  Clarity and openness are essential to successful implementation of these reforms. The Government should place resource allocation systems for determining the notional costs recorded in a care account on a statutory footing, making it clear that they are subject to the well-being provisions in clause 1 of the draft Bill, and requiring local authorities to publicise their schemes and to include full details of how the amount included in the personal budget is calculated.

33.  We also urge the Government to put beyond doubt that a resource allocation system cannot include a blanket policy of reducing a person's personal budget or notional cost on the basis of the presence of a carer, without the carer's knowledge or consent.[31]


34.  In its policy paper explaining the change the Department of Health states: "People will need to have their care costs monitored over time, to record their total accumulated costs and demonstrate progress towards the cap. Where care costs change over time, for instance as a result of uprating for indexation, the total of their accumulated costs will need to be amended accordingly, so that they are not disadvantaged." The Government intend to amend the Bill to create what will be known as a "care account". This account will provide an annual update of a person's accumulated notional care costs that count towards the cap.

35.  The Department told us: "The price of care will change over time. To reflect this, the level of the cap and the amount in the Care Account that count towards people's cap will increase in parallel every year." The policy statement also explains that "this increase will be applied in a way that will ensure people with a Care Account would not be disadvantaged; a person who is 50% of the way towards the cap will remain 50% of the way towards the uprated cap. This will ensure that the real value of the cap remains constant and the partnership between the state and individual is stable."

36.  The Government intend to amend the Bill to uprate automatically both the cap and the care account annually based on a defined measure. The Department state that "it is expected that the level of the cap will be specified in regulations". Officials told us that work on what factors should be included in the defined measure has not been completed. We note that the Dilnot Commission recommended that the cap should be uprated yearly on the same basis as the basic state pension.[32]

37.  The Bill must provide that regulations governing

  • the level and indexation of the cap,
  • any subsequent changes to the cap that fall outside the defined measure, and
  • arrangements for indexing the care account

are subject to affirmative resolution.


38.  As well as the arrangements for uprating the cap and care account, there are the lower and upper means-test thresholds. In the Policy Statement the Department set out the Government's intention that these will be uprated. However, the draft Bill does not provide for automatic indexation of these thresholds and the Government have indicated that the draft Bill does not require amendment to bring in the means-test change. However, one of the benefits claimed for these changes is the predictability that they bring to the system. The Bill must provide for automatic uprating of the lower and upper means test thresholds using a defined measure specified in regulations. The Bill must also provide that regulations that make

  • amendments to the defined measure,
  • changes to the lower and upper thresholds outside the defined measure, and
  • changes to the assumed tariff income

are subject to affirmative resolution.


39.  We discuss in Chapter 6 the concern expressed to us by the Local Government Ombudsman that the draft Bill's proposed arrangements for continuity of care when a person moves from one local authority to another could result in more cases of maladministration. In the case of people for whom there is no duty to meet needs (i.e. those who opt out before the financial assessment, or who do not meet the financial requirements and do not request the local authority to meet their needs) the Government should ensure that the ordinary residence rules and portability (continuity of care) provisions protect their care accounts and personal budgets.

40.  We have not had time to take evidence on how the Government propose to operate the capped cost system in cases where people move from England to Scotland, Wales or Northern Ireland. However, the Government need to be clear how the accrued amount in a person's care account is treated, whether it will it continue to be uprated, and whether the meter will have kept running in the event that the person returns to England. Answers to these questions will be critical to settling the rules for ordinary residence when people move from one nation of the United Kingdom to another.


41.  Enactment of the Care and Support Bill will constitute the biggest change in the law governing the operation of care and support in England since the National Assistance Act 1948. The Bill, when enacted, will not just consolidate and streamline into a single statute 60 years of piecemeal law making; it will also place on a statutory footing for the first time both the principles and the practice of self-directed personalised care. When taken together with the introduction of a capped cost system and a national eligibility threshold the Bill presents a significant implementation challenge for everyone with a stake in the care and support system.

42.  In response to our web forum[33] concern was raised about the need for assessments to be "done by adequately trained and knowledgeable staff. If there aren't enough people in social care to do this, why not use properly trained people from relevant voluntary organisations?" The volume and complexity of assessments, of carers, of people with care needs, the application of mean-testing, and the determination of notional costs all raise questions about the level of initial and ongoing training and support needed for local authority staff and social workers. These are matters we would expect to be fully analysed in the revised impact assessment that accompanies the final Bill.

43.  As we discuss elsewhere in this report, we are concerned about the boundary that defines what constitutes free NHS care and what is means-tested care and support. Clarity is essential. Arrangements should be set in place either in statute, in regulations or in guidance to ensure that, where either the NHS or local authorities assess a person and determine that they are not eligible to have their needs met by them, they ensure that assessments are coordinated and information shared to minimise any delay in putting in place suitable arrangements to meet their needs, for example by provision of information and advice or by exercising the prevention duty in clause 7 of the draft Bill.

44.  In its recommendations to the Government the Dilnot Commission highlighted the need for an awareness campaign on the costs of care and the new funding system. We agree with this recommendation, but we would go further. In the evidence we received in our web forum the need for clarity about who is responsible for what was a persistent theme. We believe that the Government must devise a campaign that raises awareness of what the national care and support offer is. This should make clear how people can plan and prepare, what their rights are and how to access the information, advice and assistance they need both to prevent and postpone the development of care needs and to support people to maintain their independence when they do have care needs.

17   Fairer Care Funding http://www.dilnotcommission.dh.gov.uk/files/2011/09/Technical-Briefing-Note.pdf Back

18   House of Commons Official Report, 11 February 2013, column 592. Back

19   The FACS guidance was replaced by Prioritising Need in the Context of Putting People First: a whole system approach to eligibility for social care - Guidance on Eligibility Criteria for Adult Social Care, England 2010, Department of Health. However the system is still commonly referred to as FACS, and we continue to use this term in our report. Back

20   Report, Volume 2: Evidence and Analysis, page 46. Back

21   Q 326. Back

22   The Commission considered three options, metering actual spend, metering length of time and metering notional cost. It opted for notional cost. The reasoning is set out in Fairer Care Funding, Volume 2: Analysis and Evidence. Back

23   Paragraphs 111-113. Back

24   Paragraph 55. Back

25   Paragraph 57. Back

26   The Dilnot Commission explained that "A RAS works by assessing a person's care needs using a questionnaire, which gives each person a numerical score. The scores for people entering the care system are compared with the scores of existing care recipients, and an estimated care package cost is assigned based on the cost of care for other people with similar scores. The local authority then designs a care package for that person, and aims to meet their needs for the same cost to ensure fairness with respect to other care recipients. Exceptions are made when it is not possible to fully meet the person's needs at the same price." Fairer Care Funding, Volume 2: Evidence and Analysis, pages 54-55. Back

27   LAC (DH) (2008) 1 Transforming Social Care, paragraph 19 Back

28   Guidance on Eligibility Criteria for Adult Social Care, Department of Health, February 2010, paragraphs 129, 130 and 132. Back

29   Law Commission, Adult Social Care Consultation Analysis. Back

30   Q 48. Back

31   We consider this issue further in the context of clause 27 of the draft Bill, at paragraphs 205-208. Back

32   Report, page 78. Back

33   Appendix 5. Back

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Prepared 19 March 2013