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Social services and local authority chiefs said last week that without substantial new government investment in social care the planned NHS reforms will fail. Janet Snell reports.

Prime Minister Tony Blair and health secretary Alan Milburn hinted last week that the NHS is set for another big cash boost in April’s budget. This came two days after senior local government figures called a press conference to warn that social care services will be in "jeopardy" unless substantial and immediate investment is made.

The press conference announced the findings of a survey by the Association of Directors of Social Services and the Local Government Association, which found a £1.2bn shortfall between what the government makes available and what local authorities need. Some two-thirds of this financial black hole lies within children’s services where there is a projected overspend of 69 per cent, while learning difficulty services and older people’s services face overspends of 19 per cent and 12 per cent respectively.

Given the current focus on the Victoria Climbie case and the apparent failings in the child protection system, a £700m shortfall in funding for children’s services - driven by the "remorseless rise" in the number of children in care - ought to have prompted some sort of reaction from government. But Milburn and his health colleagues do not appear to have shifted their attention from trolley waits, "bed-blocking" and NHS waiting lists.

ADSS president Mike Leadbetter believes, however, that the government has not fully grasped the fact that unless it stumps up the cash for adequate funding of social care its plans to reform the NHS will fail.

He says: "It’s true that social services have had increases, but compared to the huge sums poured into health they have suffered. Unless funding in social care matches health you just can’t provide a service."

Rob Hutchinson, ADSS children’s services spokesman, adds that it is not just a question of NHS services relying on a properly funded social care sector. "New initiatives like Sure Start and the Children’s Fund will suffer too if other parts of the system that provide services to children are under-funded. It threatens the integrity of so many of these new preventive schemes."

The survey also found that 68 per cent of local authorities are restricting eligibility criteria for services in an attempt to contain demand. Only people in the most acute need are now receiving a service.

It also highlights concern over "unrealistic" assumptions about the preserved rights transfer (funding of higher rate income support for pre-1993 care home residents) to local authorities. Councils are predicting a £56m funding shortfall - equivalent to 15 per cent of the preserved rights allocation for 2002-3, excluding care management.

Another issue is that councils lost £36m more than they expected when the National Care Standards Commission took over inspection and registration.

So the financial picture for local authorities in general and social care in particular is a grim one, and the local authority sector comes out very much the poor relation to health.

Even when the government has come up with more money for social care in the shape of the £300m "cash for change" funding - announced last autumn to ease so-called "bed-blocking" - there was no indication whether it was a one-off payment or a regular commitment.

This made it very hard to plan during the current round of setting local authority budgets. Many councils have proceeded on the basis that more cash for change will be forthcoming, but if it is not they will be in even deeper trouble.

No one denies that the health service needs more cash too, but if the government is serious about its pledge to engage in "joined-up" thinking it needs to do more to promote joined-up public services. And unless there is a more balanced approach to funding health and social care, the NHS Plan will go out the window and the whole system could grind to a halt.

Councils’ WISH-LIST

In June’s comprehensive spending review, the ADSS and the LGA want:

- More cash for children’s services.

- An urgent review of preserved rights funding.

- A review of the funding assumptions around the National Care Standards Commission.