Funding doubts over adult care policies

The future funding of adult social care was already a hot political topic before last week’s National Children and Adult Services Conference. During the event the heat was turned up even further.

For Labour, care services minister Phil Hope and health secretary Andy Burnham went to Harrogate to sell their visions to adult social services’ great and good, while shadow health secretary Andrew Lansley did the same for the Conservatives.

They also took the opportunity to point out the deficiencies in their opponents’ positions.

However, with the end of the consultation on the government’s funding green paper just two weeks away, sector leaders left the annual conference with many questions about how the next government – Labour or Tory – would reform care finance.

The issue’s growing political importance had been illustrated during this autumn’s party conference season.

First, prime minister Gordon Brown had followed the green paper with a £670m-a-year pledge to introduce free personal care at home for people with critical needs from October 2010.

Then a week later, the Conservatives proposed inviting people to make an £8,000 payment on retirement to ensure any future residential care fees were met in full, preventing them from having to sell their homes and not costing the state a penny.

Labour pledges

Labour’s free care pledge would require £420m in annual funding from the Department of Health and £250m a year from councils, found from efficiency savings.

In an interview with Community Care in Harrogate, Hope said that the proposal was achievable and pointed to a DH paper on how councils could make better use of existing resources, which was later published at the event.

This suggested there were significant savings for councils to make from reshaping provision, particularly by reducing admissions to residential care and doing more to support people at home.

It laid out the wide disparities in councils’ use of residential care, suggesting that those with higher admission rates could deliver substantial savings by following the practice of those with fewer admissions (see graph).

However, Andrew Cozens, the Local Government Association’s group lead on adult social care, admitted councils were “very worried” about the free care plan because they believed ministers had “underestimated” the true costs.

Cozens said: “If the government will not put any more in the pot and if this is an underfunded proposal it will fall on local authorities and make the situation worse.”

He said councils needed to be certain of the number of people eligible for free care at home before the plan was taken forward.

Before Brown announced the policy, councils had already been instructed to make 3% annual efficiency savings on their adult care budgets to invest in frontline services.

With budgets worth a total of £16.1bn in 2008-9, this amounts to just under £500m this year, almost double the cost of the free care plan to councils.

Sector scepticism

However, Cozens said there were a number of other calls on this money.

He also described it as an “opportunistic juxtaposition” on the part of the government to link its free care pledge with last week’s report on making best use of resources.

Lansley was scathing about Labour’s free care plan at last week’s conference.

“[It is] not credible to offer it when we can’t afford it. They know it’s politics and not policy and I think it’s irresponsible,” he said.

However, the Tories’ residential care pledge is also shrouded in doubt.

In her conference speech, Association of Directors of Adult Social Services president Jenny Owen repeated her concern that both parties had each only focused on one part of the system – domiciliary care in Labour’s case and residential care in the Tories’.

Andrew Chidgey, head of policy and campaigns at the Alzheimer’s Society, told Community Care that the charity was anxious that the Conservative’s proposal would not yield enough money to pay for good quality provision for all those who needed it.

There are certainly question marks against the Conservatives’ sums. The policy would involve no state funding, with the scheme being provided by the insurance industry, but to be affordable it would require comprehensive take-up from retirees – despite being voluntary.

Hope said: “It’s a voluntary scheme which people pay for up front so take-up will be small.”

He accused the Tories of a “misdirected response” to a major problem, with their focus on residential care and said comparing the two parties’ position was “like comparing a penny farthing with a modern system of transport”.

However, the Conservatives may have potentially stolen a march on Labour with Lansley’s pledge to retain attendance allowance, which is paid to people over 65 who need care because of a disability.

The green paper sparked controversy with its proposal to use “disability benefits” to fund the extension of support with personal care costs to all eligible care users, overhauling the current means-tested system.

Economic modelling for the proposals was based on using only attendance allowance, which is paid to disabled older people, to fund increases in care.

However, the reference to “disability benefits” had sparked significant concern among disability groups that disability living allowance for under-65s was also at risk.

benefits threatened

This was quashed by Andy Burnham in his speech in Harrogate, to the delight of disability charities. But campaigners bemoaned the fact that the health secretary refused to do the same on AA, while earlier in the week Hope had faced several hostile questions over the same plan.

This forced the care services minister to claim: “We aren’t getting rid of attendance allowance. We are taking the budget and reshaping it so everyone gets access to care and support.”

Burnham stressed that no recipient of AA at the time of any transfer would lose out.

However, in a move welcomed by the Alzheimer’s Society, Lansley said: “In our view [transferring the budget] isn’t the way forward. We will oppose it.”

With the green paper consultation set to end on 13 November, all parts of the social care sector will shortly be publishing their views on how funding reform should be taken forward.

The government reiterated its pledge to produce a white paper – effectively setting out its general election platform on adult care – “early” in 2010, meaning there will be no reduction in the political temperature of the debate.

What the parties say on care funding


● Free personal care at home for people with critical care needs, funded by DH and council efficiency savings.

● All care home residents and home care users with lesser needs to receive some state funding for personal care, financed by attendance allowance budget.

● Balance of personal care costs met through voluntary or compulsory insurance.

● Means-testing retained for care home accommodation costs.


● Attendance allowance retained as benefit.

● People insured against all residential care costs by £8,000 one-off payment on retirement.

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