Scotland’s free personal care policy under renewed pressure over costs

New figures purporting to show that the level of need and funding
for free personal care in Scotland has been massively
underestimated have put advocates of the policy on the back foot.

Earlier this year, Welsh assembly health minister Brian Gibbons
said he no longer backed the policy, while last year community care
minister Stephen Ladyman said free personal care for the over-65s
in Scotland, introduced in July 2002, was unsustainable.

The latest research on the Scottish experience, carried out by
economists and long-time critics of the policy Jim and Margaret
Cuthbert, of the Fraser of Allander Institute at Strathclyde
University, finds the gap between the budgeted and actual cost of
the policy could reach £130m by 2022.

Although the Scottish executive maintains it is committed to the
policy, some fear the continued negative coverage could undermine
public and political confidence and end campaigners’ hopes of
it being introduced in England and Wales. So just how well founded
are the latest concerns over the financial viability of the

The Cuthberts’ original research in November 2001 estimated
the annual cost of providing personal care in Scotland could rise
to £368m three years after its introduction. Although the
executive is yet to release final figures, a separate review last
October showed it was one-third over its £125m budget in its
first full year of operation.

The Cuthberts’ latest, more comprehensive, analysis suggests
that the population statistics on which the executive’s Care
Development Group based its costing estimates were flawed. The
Cuthberts say the CDG underestimated the number of older people
living in Scotland, the percentage of older people who are disabled
(or in need of personal care services) and the number of people who
at the time had an unmet need but would be eligible for free

Not only do they say the number of those with an unmet need is more
than twice the CDG estimate, but that the annual unit cost of
meeting these needs is £2,000, not £1,100 as the CDG
predicted. This would equate to £70m of unmet need, compared
with the CDG estimate of between £15m and

According to the Cuthberts, the biggest hole in the CDG’s
figures is the number of people deemed to be disabled. The CDG put
this at 142,000, but the Cuthberts say this was based on
miscalculating the overall number of older people in Scotland and
the assumption that the number of disabled people is falling. Based
on figures from other studies, it predicts 348,000 people over-65
have a disability.


Support for policy

Also, while the CDG estimated that 45 per cent of care provided by
councils was personal care, the Cuthberts, drawing on other
studies, suggest the figure is 60 per cent.

All this points, say the Cuthberts, to free personal care in
Scotland costing £60m more a year now than has been budgeted
for, rising to £130m more by 2022.

The complexity of the analysis and lack of concrete figures to work
from make it difficult to challenge the Cuthberts’ findings.
However, many in the care sector remain unwavering in their support
for the policy.

Jim Jackson, chief executive of Alzheimer’s Scotland and a
member of the CDG, says: “When the calculations were
originally done we all recognised there were large margins of
uncertainty and so recommended it was regularly reviewed alongside
all other health and community care costs.” He says the
Cuthberts’ analysis assumes people will be as unhealthy and
have the same level of need in the future as now.

“If you look five to 10 years ahead, evidence suggests people
will live longer and, by doing so, their period of ill-health will
be delayed. Therefore there will be the same amount of illness [at
any one time] not a growing amount. There isn’t a

Jackson adds that it is difficult to say how much councils spend on
free personal care because it is included in the social services
block budget. “If councils are saying they have spent more
than their allocation, they would have to show they have not
shifted [the money] into something else.”


Extra funds

Alan McKeown, policy manager at the Convention of Scottish Local
Authorities, dismisses the research as
“scaremongering”. He says there is enough money in the
system to meet needs up until 2007-8 and that five councils which
had higher-than-expected demand have been given extra funds.

“The figures have been revised to reflect the increase in
over-65s starting from 2008-9. It is good practice to keep
reviewing it and there isn’t a huge problem,” he

McKeown says the policy should be seen within the context of the
overall health and social care system and the benefits to

“It promotes independence and so people should be able to
live in their own homes longer, take a more active role in their
community and have a better quality of life. If people aren’t
then being admitted to hospital or institutional care so early what
are the benefits of that to the system?”

Despite the Cuthberts’ suggestion that there is already
anecdotal evidence of councils prioritising personal care at the
expense of non-personal care, such as help with shopping and food
preparation, McKeown insists rationing should not take

Support of a kind for the policy also comes from the Institute for
Public Policy Research. Its senior economist, Peter Robinson, says
the main question over the policy since 2001, when a Royal
Commission looked at what impact it would have if introduced across
the UK, remains whether it would prompt a shift from informal care
to care provided by the state.

“[If] it doesn’t resolve the issue of disengagement [of
the public with informal caring], it doesn’t necessarily
throw any more light on the issue,” he says.

“Scotland will continue with the policy; reversing it would
undermine the executive’s authority. It couldn’t afford
to do that.” However, the increasing negative publicity makes
it more unlikely England will follow suit, Robinson

“We’re about to enter a period where public spending is
to go down and the government has to meet several policy
commitments – it is almost inconceivable it will give
priority to personal care.”

In Wales, social services leaders have ruled out backing the policy
unless it is funded by extra taxation.

Byron Williams, Association of Directors of Social Services older
people spokesperson, says, despite enthusiasm for the policy
cooling at the Welsh assembly, he remains a supporter – but
only if it is funded centrally through progressive taxation based
on income.


Undermine services

“It should be appropriate for social policy to pool the risk
of needing care, but to divert existing resources would undermine
other services. The cost of care causes a lot of concern for people
as they get older and we should try and remove

He says the case for free personal care funded through taxation
could be made to the electorate by comparing it with the status
quo, where people have to sell their homes to meet the
£15,000-a-year costs of living in a care home.

“With the increase of property ownership and prices there
will be increasing support for it, particularly as it is likely to
affect more people in the future,” he adds.

About 5,000 people in Wales fund their own care, which would cost
about £150m to meet. The assembly wants to introduce free home
care for disabled people in 2007.

But, for the time being at least, it appears that Scotland will be
going it alone in offering all its older citizens free personal

The executive says it will examine the Cuthberts’ findings
and feed them into its own research into the cost of the policy.
The outcome of this – and the findings of the independent
review into the funding of older people’s services in England
– are sure to be watched keenly by advocates and critics of
free personal care across the UK.

  • The Cuthberts’ research findings are available


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