Social care faces deeper cuts on back of Osborne plan

Social care will face deeper cuts lasting until 2017 on the back of chancellor George Osborne's Autumn Statement issued yesterday.

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Social care will face deeper cuts lasting until 2017 on the back of chancellor George Osborne’s Autumn Statement issued yesterday.

About £0.5bn will be cut from projected government funding for councils in 2013-14 and 2014-15 because of Osborne’s announcement of a 1% cap on pay for public sector workers in these years, the Local Government Association has estimated.

And cuts to public spending, including social care, from 2015-17 will be greater than previously thought because of the independent Office for Budget Responsibility’s downbeat forecast for the economy.

The announcements raise further doubts over the reform of adult social care funding on the back of this year’s Dilnot commission report, or how rising demand for adult care and higher numbers of child protection referrals will be paid for.

Osborne said funding for councils from 2013-15 would be revised downwards – beyond the cuts that have already been announced – because of the 1% pay cap though has not provided further details.

“The prospect of further reductions in funding for councils, running into hundreds of millions of pounds from 2013, risks adversely impacting those vital local services people rely on every day at a time when many communities are already feeling the strain,” said LGA chair Merrick Cockell.

The chancellor projected that public spending would be cut by 0.9% a year in 2015-16 and 2016-17 in real terms. However, day-to-day spending on public services, including local authorities, is set to be reduced by 3.5% in 2015-16 and 2.7% in 2016-17, because the government will face rising bills for debt interest payments and social security.

“Two more years of substantial real public spending cuts: that is what the Chancellor has promised in response to the Office for Budget Responsibility’s (OBR’s) dramatically worsened macroeconomic forecasts,” said Paul Johnson, director of think-tank the Institute for Fiscal Studies. “Until now we had been thinking of four years of cuts as unprecedented in modern times. Six years looks even more extraordinary.”

Older people’s charity WRVS declared itself disappointed by the statement, saying it meant preventive services would be hit hard, increasing pressures on the NHS.

“We are disappointed that the opportunity to provide older people living at home with better preventative support is again being overlooked,” said chief executive David McCullough. “I hoped we would see in the Autumn Statement a commitment to make up some of the ground that has been lost where some local authorities cut back their care budgets.”

The government will not set out precise spending plans for 2015 onwards until much closer to the time and budgets will be dependent on the result of the general election due in that year.

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