Social care funding: time to end a national scandal Contents

Summary of conclusions and recommendations

1.Adult social care in England is inadequately funded. 1.4 million older people (14 per cent of the population) had an unmet care need in 2018. The number of older people and working-age adults requiring care is increasing rapidly, and public funding is not only not keeping pace, but has declined in real terms by 13 per cent between 2009/10 and 2015/16. (see Paragraph 1)


2.After decades of reviews and failed reforms, it is not clear how another Green Paper is going to make progress on addressing the challenges in social care funding. With each delay the level of unmet need in the system increases, the pressure on unpaid carers grows stronger, the supply of care providers diminishes and the strain on the care workforce continues. Government action, rather than further consultation, is required. (Paragraph 20)

3.To avoid further delay, the Government should produce a White Paper, not a Green Paper, with clear and plausible proposals for sustainable adult social care funding. (Paragraph 21)

Funding for adult social care

4.As fewer individuals have been able to access local authority funding, greater pressure has fallen on family and friends to provide unpaid care. This may not be sustainable. Restoring access to local authority funding for many individuals could help to relieve this pressure. (Paragraph 40)

5.To restore care quality and access to 2009/10 standards, addressing the increased pressure on unpaid carers and local authorities and the unmet need that has developed since then, around £8 billion a year in additional funding will be required for adult social care. More will be required in subsequent years as the population of older and working-age people with care needs continues to grow. Roughly half of all public funding for social care is spent on the working-age population. (Paragraph 41)


6.Unlike the Secretary of State, we are convinced that the increasing disparity between prices paid by self-funders and those paid by local authorities is unfair to both sides and therefore unsustainable. The effect is to drive care homes to market to self-funders, and so reduce the availability of places for individuals funded by local authorities. (Paragraph 54)

7.Local authorities differ in respect of the cost pressures they face and their ability to raise funds. Some local authorities are therefore able to spend more per head on adult social care than others, leading to a postcode lottery in standards of provision. (Paragraph 65)

8.We share the concerns of many witnesses about the Government’s plans to make local authorities more fiscally self-reliant. Demand for social care is often greatest in areas where business is least buoyant. (Paragraph 66)


9.Increased funding for adult social care will allow for investment in the care workforce. Higher pay is required for care workers in publicly-funded care providers to allow those providers to compete with other local employers. The care workforce needs a career structure which better reflects the skills required to be a good care worker and the social importance of the sector. (Paragraph 87)

Options for reform


10.Any long-term funding solution for adult social care should:

(a)Put more money into the system through a combination of public and personal funding;

(b)Be simple and easy to understand for those accessing public funding;

(c)Ensure local authorities can afford to provide care to all those whose needs meet the legal eligibility criteria, which must be interpreted fairly and consistently across local authorities;

(d)Quantify and address serious unmet need;

(e)Ensure the level of unpaid carers in the system does not suffer a steep decline and is sustainable;

(f)Better protect individuals from catastrophic costs;

(g)Reduce the disparity between entitlement to help in the National Health Service and the adult social care system, ensuring that entitlement is based on the level of need, not the diagnosis;

(h)Allow local authorities to pay care providers a rate that covers the costs of providing care, without the need for cross-subsidy from self-funders;

(i)Distribute adult social care funding more fairly across local authorities;

(j)Invest in the social care workforce and ensure a more joined up approach to workforce planning with the National Health Service. (Paragraph 90)

Public versus private individual funding

11.The Government has two categories of challenge: how to fund the system to ensure adequate quality and access; and how to make people’s entitlement to public funding fairer. Notwithstanding the latter, which is discussed in our subsequent conclusions, the Government must increase funding to restore levels of quality and access to those observed in 2009/10. This should be its top priority. (Paragraph 127)

12.As most previous inquiries have concluded, the costs of long-term care should not fall solely on the shoulders of individuals and families or on the state. We support a partnership approach, in which the costs of care are shared between individuals and the taxpayer. (Paragraph 128)

13.Free personal care is fair, better aligned with NHS entitlement than the current system and easier to implement than alternative proposals. It may be more expensive than some alternatives, but it could reduce demand for residential care and health care in the long-run by encouraging users to seek domiciliary care early. (Paragraph 129)

14.Free personal care is a partnership approach because it covers only some of the costs of social care. Personal care means essential help with basic activities of daily living, such as washing and bathing, dressing, continence, mobility and help with eating and drinking. It does not include other areas where support might be needed, such as assistance with housework, laundry or shopping. (Paragraph 130)

15.Under free personal care individuals would therefore only receive funding for support with these basic activities of daily living, based on the minimum threshold of eligible needs as defined by the Care Act. Accommodation and living costs, which everyone incurs irrespective of their care needs, would continue to be met by the individual. (Paragraph 131)

16.The Government should introduce a basic entitlement to publicly funded personal care for individuals with substantial and critical levels of need. Accommodation costs and the costs of other help and support should still be incurred by the individual. The Health Foundation and the King’s Fund estimate this would cost £7 billion if introduced in 2020/21. (Paragraph 132)

17.Free personal care must be funded properly, otherwise it will result in longer waiting times or restrictions in eligibility criteria. Funding should be reviewed each year to ensure local authorities can afford to meet demand. (Paragraph 133)

18.Some people who need long-term care for many years, particularly in residential and nursing homes, might still face catastrophic accommodation costs. (Paragraph 134)

19.The Government should retain a means test for accommodation costs. To avoid catastrophic accommodation costs, the Government should also explore a cap. (Paragraph 135)

20.No country relies primarily on private insurance to fund adult social care costs. In the current system, establishing a market for long term social care insurance in England would be difficult, even with a cap on lifetime social care costs or accommodation costs or an auto-enrolment scheme. Private insurance cannot provide the amount of funding required by the social care system, not least because roughly half of public social care funding is currently spent on people who are working-age. (Paragraph 136)

Options for public funding

21.Some witnesses said social care funding should reflect the fact that older generations are more likely to benefit from it in the short term. Employees above the state pension age currently pay no national insurance on their earnings, but their employers do. We recommend that those above the state pension age should no longer be exempt from employees’ national insurance. They should pay the same rate as other age groups. This could raise more than £1 billion. (Paragraph 155)

22.Social care funding should not be reliant on locally raised revenue which has little connection to local demand for social care. (Paragraph 156)

23.The additional funding needed for adult social care should be provided as a government grant, distributed directly to local authorities according to an appropriate national funding formula which takes into account differences between local authorities in demand for care and ability to raise funds from local taxation. (Paragraph 157)

24.Funding social care should be approached in the same way as any other funding pressure. We recommend that social care is funded largely from general taxation. (Paragraph 159)

25.The Government should adopt a staged approach to providing the additional funding recommended by this report. It should immediately invest £8 billion in adult social care, which is the amount the Health Foundation and the King’s Fund estimate will be required to restore quality and access to 2009/10 levels, funded nationally and distributed according to a fair funding formula. It should then introduce free personal care over the next five years. Free personal care should be available universally by 2025/26. (Paragraph 160)

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