Editor’s Viewpoint: Adult Social Care Funding – The ‘Elephant in the Room’

The issue of funding adult social care is in very simple terms, the “elephant in the room”. Readers will see on our website a rather bleak article from the International longevity Centre entitled “the end of formal adult social care”, and reveals that the UK is heading towards the bottom OECD when it comes to spending on care as a proportion of GDP.

The article goes on to suggest that up to 1.8 million people currently have unmet care needs.

The report follows the Chancellor’s autumn statement where he announced the councils will be able to raise an additional 2% as part of a social care precept which is anticipated to raise an extra £2 billion.

The problem that observers see is that, (and I would agree) it would be impossible for the government to check if the money is actually being spent on social care, or, if it has been diverted to cover other shortfalls. Furthermore, it will of course be a lot easier to raise that additional 2% in the more affluent parts of the country, whereas some other poorer parts of the country may see little benefit at all.

The simple fact of the matter is our current care funding system is unsustainable, and to compound that matter, spending on adult services has fell 12% since 2010, and during the same period needs have risen by 14%.

I did read about the German approach to long-term care, in Germany they have a social care insurance scheme, apparently they have a mandatory one and voluntary one. Over 90% of Germans are covered by the mandatory scheme, which is funded by equal contributions from employers and employees. Given the impact that the national minimum wage is going to have on the care sector, then it is certain that an additional levy on employers, covering a social care insurance scheme, if one was ever considered would be resisted vociferously.

In fact, I did read further, that there was very strong opposition to this in Germany when it was introduced with many employers refusing to contribute, and a compromise agreed were German employees lost a statutory holiday to compensate for the additional costs to employers.

But whilst the majority of Germans in the scheme consider it to be successful, it would appear that their system too maybe unsustainable. Germany faces a rapidly ageing population and a low birthrate. The added problem is that the system is funded “as pay as you go”, which means that contributions raised are distributed immediately to fund care, furthermore, it also means as the numbers of people needing long-term care increase so do premiums.

As I said at the beginning of the editorial the article does paint a very bleak outlook, and it is an issue I think will dominate the political spectrum more and more in the coming years.

Peter Adams
Editor of The Carer