Government shifts £600m destined for social care reform into tackling immediate pressures on services

The government has moved £600m originally destined for social care reform into helping councils meet existing pressures on adults’ services over the next two years.

Most of the funding – £570m – is designed to increase the capacity of the workforce – with vacancy rates hitting 9.9% as of March this year – though councils may also use it to tackle waiting times for care or assessments or to increase provider fees.

The remaining £30m will go to local authorities in areas where pressures on NHS urgent and emergency care are greatest this winter.

Sector leaders welcomed the funding from the Department of Health and Social Care (DHSC), saying it would help them plan for the winter and tackle mounting demand and inflationary pressures.

However, they also warned that it was too little to tackle short-term pressures on services and no substitute for longer-term investment.

DHSC criticised over funding cut

The DHSC faced criticism earlier this year when it revised reform plans set out in its 2021 social care white paper.

Notably, it halved its proposed investment in developing the skills and wellbeing of the workforce, from £500m to £250m, and left £600m of the £1.7bn set aside for reform unallocated, prompting fears this money would be lost to social care.

At the same time, despite councils budgeting to spend £1.1bn (6.2%) more this year than last on adult social care and cuts to waiting lists, directors warned that increases in the amount of care being delivered were not keeping pace with mounting levels of need.

Reflecting this, the DHSC has allocated the £600m to tackling these immediate pressures, rather than investing it in longer-term reform.

Councils will receive £365m in 2023-24 and £205m in 2024-25  from a new market sustainability and improvement fund – workforce fund, ring-fenced for adult social care.

Minister suggests pay boost for care staff

Care minister Helen Whately said councils should work closely with providers in using the funding to grow workforce capacity, for example, by boosting pay, in a letter to sector leaders about planning for the coming winter.

However, councils can also use the grant to cut waiting times for care packages, reviews or assessment or increase fees for providers, as well as to boost the capacity of their local workforces, though they must be able to evidence improvement in at least one of the three areas, against DHSC metrics.

These are the same conditions that apply to £400m provided to councils this year through the existing market sustainability and improvement fund (MSIF).

Authorities have already submitted a report to DHSC on how they intend to spend the MSIF in 2023-24 and will not have to provide a further report on how they intend to use the new workforce fund this year. Instead, they will need to report on how they have spent the money, and with what effect, in May 2024.

Council heads welcome funding

Council leadership bodies said the funding shift would help them tackle pressures on services, particularly this coming winter.

Beverley Tarka, ADASS president, 2023-24

“The government has listened to calls from directors and others in adult social care to make resources available earlier to support planning for winter,” said Association of Directors of Adult Social Services president Beverley Tarka.

“By announcing this funding now, guaranteeing the funding over two years and giving councils flexibility to spend it where it will make the most difference, the government is putting us in a much better place than last year, when funding came too late, while we were already in the middle of a winter crisis.”

The County Councils Network (CCN) said the DHSC’s decision was in line with its call for the £600m in reform funding to be allocated “as soon as possible to help tackle additional inflationary costs and demand pressures which are impacting social care services this year and next”.

CCN adult social care spokesperson Martin Tett also welcomed the lack of “further administrative burdens” in reporting on grant spending this year, a point echoed by the Local Government Association (LGA) in its response.

“The LGA called for this funding to be ring-fenced for adult social care and distributed to councils to help fund frontline services,” said community wellbeing chair David Fothergill. “We are pleased to see that the government has listened to councils and has protected this money.”

Cash boost ‘inadequate’ to tackle long-term needs

Provider bodies Care England and the Voluntary Organisations Disability Group also welcomed the allocation of the £600m to meeting workforce pressures, however, along with council leaders, they warned that it would not be sufficient to tackle long-term underfunding of the sector and its staff.

Care England chief executive Martin Green said the £570m for the workforce fund was equivalent to a 10p per hour pay rise for each of the sector’s 1.5m staff, whom he claimed needed a £4 per hour boost.

“Without addressing the issues inherently embedded within our sector through additional long-term funding commitments, the ambition to reduce avoidable admissions and support the discharge of patients from hospital, will remain an ambition rather than an actuality.”

Fothergill added that, amid “a huge amount of unmet and under met need for care and support, a lack of funding available for preventative care and long waiting lists”, the sector needed “secure long-term funding and a comprehensive plan for reform”.

Government ‘has ditched reform ambitions’

King’s Fund senior fellow Simon Bottery said the funding was not “the properly funded workforce plan that social care needs”, adding: “In using money originally earmarked for wider reform help keep afloat the existing system, the government is acknowledging the end of its broader ambitions for social care.

The need for reform will not go away, though, and if a new government, of whatever colour, wants to ensure people get the social care they need they will need to set out a genuine plan for change.”