Government publishes Fair Cost of Care guidance

The Government has published guidance for Local Authorities in England on the Market Sustainability and Fair Cost of Care Fund 2022 to 2023.

£162 million raised by the Health and Social Care Levy will be made available to local authorities this year in order to start the process of ensuring that they are paying a ‘fair price for care’; £600 million will be available in each of the following two years. With this funding Local Authorities will be asked to:

• Carry out cost of care exercises to improve understanding of how much it costs to provide care in their specific area, including assessing the various costs care providers face in the area;

• Ensure the care market in the area is sustainable and identify and increase rates where a fairer cost of care is needed; and

• Spend no more than 25% of funding in year one towards implementation costs to ensure remaining funding goes towards genuine increases in fee rates.

Health and Social Care Secretary Sajid Javid said:
“This is the beginning of one of the most comprehensive reform plans that this country has ever seen in adult social care.

“The Health and Social Care Levy will help fund reforms to social care and the NHS – ensuring everyone who needs support is cared for in the right place at the right time.

“For this to happen we need a thriving adult social care market and this will only be possible if providers receive a fairer cost for care.”

Minister for Care and Mental Health Gillian Keegan said:
“We all want to know our loved ones are receiving the best care possible and we need a thriving care market to make this happen. This is the first step in our adult social care reforms to ensure a sustainable system fit for the future.

“By supporting local authorities to review the market and costs in their areas and providing funding to help ensure a fairer cost of care, we can turn our vision for social care reform into a reality.”

Cllr David Fothergill, Chair of the LGA’s Community Wellbeing Board, said:
“Social care has been facing problems regarding instability and unsustainability within the market for a number of years, and it’s good to see recognition of this from the Government with this plan.

“However, we believe that the funding allocated falls far short of needs, and will not fully resource councils and providers in delivering the Government’s objectives. Providing detailed market sustainability plans will place additional burdens on already overstretched staff, who in some cases are already struggling to deliver statutory services.

“With funding allocations unknown for years two and three of the time period, councils and providers will be hampered in securing the longer-term certainty that they have called for for so long.

“Adult social care is facing a funding gap for current services, increasing each year due to inflation and other costs even with these reforms fully funded. This is without considering the immediate need to address unmet and under met need on these overburdened systems.

“Without adequate funding, some councils will face a battle to balance budgets, worsening existing pressures and running the serious risk of impacts on the ability to deliver timely and quality care to those who draw on it.”













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