Lessons from history: Why any transfer of the Independent Living Fund to councils must be ring-fenced

As the government decides on the future of the ILF, the experience of 20 years ago illustrates the risk of transferring the resource to councils without strings attached

By Pauline A. Thompson

“The Independent Living Fund (ILF) is to close and the government is providing local authorities with funding to cover the change in policy.” Sounds familiar?

Actually, this was 1993 when the first ILF closed. Local authorities received “funding identified as related to the closure of the Independent Living Fund and the different basis on which the new arrangements for disabled people would operate”[1], known as the Independent Living Transfer. What happened then holds some important lessons as the government decides whether to persist with its plan to close the ILF and transfer its resources, without ring-fencing, to councils, after the Court of Appeal quashed its original proposal to do so.

The funding was for three years, was paid to all UK local authorities and amounted to £229.6m. The government chose not to ring-fence any part of the transfer, nor to monitor the use of the money, nor to specify its exact purpose. Research supported by the Joseph Rowntree Foundation and conducted by Ann Kestenbaum for the Disablement Income Group (DIG) [2] found inconsistencies in the way funds were used by local authorities and confusion about their purpose.

There was huge variation in the ways local authorities used the funding, and “a mix of good intentions, innovation and lost opportunities”. All but one of the 54 responding authorities spent some proportion on community care packages. Twenty authorities used part of the transfer to make payments to users, and fund personal assistance schemes.

Wide variations in use

However, some local authorities spent the transfer entirely on in-house services, such as care attendant schemes. Others said that it was all to be used in the independent sector. One reported spending 10% of their allocation on residential care. Others used the funding for new occupational therapists posts or spent part, often considerable amounts, on equipment and adaptations for older people, because their own budgets for these were inadequate. The report concluded that the impact of the transfer was overshadowed by concerns about older people.

The research showed that lack of clarity about its purpose delayed planning for its most efficient use in its first year. Once taken up by local authorities, it was used for various purposes depending on local priorities. In the light of this confusion and inconsistency, the report called (unsuccessfully) for ring-fencing of the transfer for the final year, 1995/6, and its use for specific purposes.

We now have a much changed landscape. Direct payments and the shared funding of independent living packages by local authorities with the ILF did not exist in the early 1990s. However, public finances are under even greater pressure now and any transfer of funds without ring-fencing risks a repeat of what happened in 1993. Local authorities do not like ring-fencing, yet sometimes the argument to do so is more compelling.

History shows us the folly of not learning from it.

Pauline A Thompson was a trustee of the ILF from 1988-93 and chief executive of DIG until 1999.

[1] Caring for People, Department of Health, 1993

[2] An opportunity lost? Social Services’ use of the Independent Living Transfer, Kestenbaum, DIG, 1995

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