Report on Reforming Social Care Reveals £1bn “Redirected”

The National Audit Office (NAO) published a report looking at Reforming Adult Social Care in England, and suggests that the government is behind its revised timescales for introducing the reforms, and warns that there is risks in the capacity and resource of local government to implement these changes effectively, under their current funding envelope.

Charging reforms have been delayed and system reforms have been “scaled back” the NAO said as it made a series of recommendations.

More than a billion pounds of the £1.7 billion committed to reforming the adult social care system in December 2021 has been diverted to other care priorities, according to a new National Audit Office (NAO) report.

Reforming adult social care in England reveals that only £729 million may now be spent between 2022 and 2025 on reforming the adult social care system, representing a 58% fall in the budget.

Rising inflation has compounded long-standing pressures in adult social care and, coupled with concerns about the sector’s contribution to delays to hospital discharge, has led the Department for Health and Social Care (DHSC) to reprioritise its reform funding and activity in favour of helping to stabilise the sector.

At last year’s Autumn Statement, government postponed its £3.6 billion charging reform initiative and committed up to £7.5 billion to the sector, including £2.7 billion of new central government funding, to help ease immediate pressures. These measures provided some welcome relief for local authorities.

DHSC estimates that in 2023-24, local authorities, in aggregate, intend to spend enough on adult social care to cover cost pressures. However, there is local variation and funding may not be reaching areas that need it most because government has not updated the formula used to distribute most local government funding for adult social care since 2013-14.DHSC estimates that around a quarter of local authorities may not spend enough to keep up with the cost pressures they face this year, while one in six expects demand for adult social care to exceed capacity this winter.2

Despite some recent signs of improvement, the care system remains under significant pressure. Among the many challenges are concerningly high waiting lists, which local authorities reported had increased by 37 per cent between November 2021 and April 2022.3 While they have eased slightly since then, survey data suggested that the number of people waiting more than six months in March 2023 for a care assessment was almost double – at around 82,000 – what it was at the end of 2021.

Vacancies in adult social care in England have increased by 173 per cent in the past decade and, despite a recent fall, stand at around 152,000 (a 10 per cent vacancy rate). Around 70,000 staff have been recruited from outside the UK in the past year.4
The NAO report finds that DHSC has much to do if it is to achieve its 10-year ambition for reforming adult social care and must manage significant risks. However, DHSC has not established an overarching programme to coordinate its reforms, making it difficult to know if it is on track to achieve its objectives.

DHSC is delivering on two of its eight workforce projects – supporting international recruitment and adult social care volunteering – the remaining six are in development.  Some projects within digital, data and assurance have made better progress.

The NAO found that DHSC does not have a long-term funded plan for transforming adult social care. The department’s Next steps paper, published in April 2023 which contained high-level plans for system reform – does not go beyond the current spending review period.

Delivering charging reform by October 2025, will require significant work by both DHSC and local authorities which will need to begin soon to remain on track. The NAO heard that work on preparing local authorities would need to have started by summer 2023.

The NAO recommends that DHSC assesses the impact of its current and planned reform interventions on local authorities and seeks stakeholder views to ensure its plans are manageable. It should also set out a costed plan for implementing charging reform from October 2025, and map the funding required to deliver its planned reform outcomes.

Gareth Davies, the head of the NAO, said: “Adult social care reform has been an intractable political challenge for decades. Government has set out its ambition to meet this challenge and now needs to demonstrate how it is delivering on these plans.”

Mr Davies said government should consider local government capacity before moving forward with charging reform alongside the system reform.

“To maximise its chances of succeeding, government will need to ensure it understands the impact of its ambitions on local authorities and other stakeholders and establish a costed plan which ensures delivery of its long-term goals.”

The CCN had called for the government to postpone these reforms, which includes a £86,000 cap on care and more generous means-test, last year.

This was because it would have been impossible for councils to implement the changes without worsening services, due to extreme financial pressures. The government put forward a two year delay until October 2025 in response.

Cllr Martin Tett, Adult Social Care Spokesperson for the County Councils Network, said: “Last year, the County Councils Network (CCN) highlighted that it would be impossible to implement the government’s proposed charging reforms in social care without making services worse due to extreme financial pressures, and the government took the tough but necessary decision to defer them.

“We recognise that there is a clear rationale for introducing these charging reforms, but they cannot be delivered on a shoestring as this National Audit Office report shows. Previous CCN research has shown their costs could be a minimum of £10bn higher than estimated and deepen the workforce crisis in social care. The next government must ensure that these reforms do not fall at the first hurdle by ensuring there is enough resource and workforce capacity in the social care system.”

Lucinda Allen, Senior Policy Officer at the Health Foundation, said: ‘The NAO’s report should be a wakeup call to government and political parties ahead of the general election. The social care system is in crisis. Older and disabled people are going without the care they need, staff vacancies stand at 1 in 10, and reliance on unpaid carers is high.

‘Successive governments have broken promises to ‘fix’ social care. The current government is no different, watering down its reform plans and delaying the introduction of a cap on care costs – leaving people vulnerable to potentially catastrophic costs. Money earmarked for reform is instead going towards immediate pressures on care services, continuing a legacy of short-termism in social care funding.

‘Fundamental reform of the social care system in England is needed to improve people’s access to care, boost pay and conditions for staff, and increase state protection against care costs. This will require additional funding. The Health Foundation estimates it could cost an extra £8.3bn a year by 2032 just to meet expected demand as our population ages. An ambitious government can afford to go further and improve our social care system – and stop history repeating itself.’

Cathie Williams, CEO of the Association of Directors of Adult Social Services (ADASS) said, ‘Delays and partial implementation of reform in social care, together with the absence of long-term workforce and funding plans have had a significant impact on people needing or working in care and on unpaid carers. In April, ADASS published Time to Act, which set out actions for local areas, but it needs Government action to come to fruition.
‘Together with NHS pressures – 70% of directors say that their staff are undertaking work that would have been done by the NHS on an unfunded basis, reducing resources for essential social care – this adds to council funding pressures and makes the situation for all of us needing care and support or healthcare even less sustainable. Only by recognising that wellness and wellbeing are essential for our economic and social infrastructure and investing in a long-term fully funded plan for social care can we make sure we can all live and work and care.’