Extra £1bn for social care but pay freeze looms for social workers in Rishi Sunak’s spending review

Adult social care settlement 'decidedly reckless' in context of Covid-19, say charities, though government claims it will enable councils to maintain services and meet rising demand

Rishi Sunak
Chancellor Rishi Sunak (credit: HM Treasury)

Social care will have access to an extra £1bn next year but councils are unlikely to be funded to increase social worker pay, according to the government’s spending review, set out today by Chancellor Rishi Sunak.

Despite the increases for social care, sector bodies accused the government of a “decidedly reckless approach”, saying the funding was inadequate to meet needs in the context of Covid-19, contrary to ministers’ own claims.

Sunak said pay would be frozen for public sector workers outside the NHS in 2021-22, other than those earning £24,000, meaning their pay will be cut in real-terms given expected inflation next year of about 1.5%.

While pay for local authority social workers will be negotiated by councils and unions – through national bargaining arrangements in most cases – government spending limits for local authorities are unlikely to allow for a rise for practitioners. This is despite unions estimating that pay for local authority social workers has fallen by around a fifth in real terms since 2009-10. 

Sunak said that councils’ spending power – the amount that authorities have at their disposal – will rise by 4.5% in cash terms (roughly 3% in real terms) next year.

This relies on authorities increasing council tax by 2% – the limit for any rise that does not require the consent of local people through a referendum – and levying an additional 3% through the adult social care precept, a top-up to council tax that must be directed at adults’ services.

Extra social care cash

When combined with an additional grant worth £300m for children’s and adult social care, Sunak said this would provide an additional £1bn for social care to that provided in 2020-21. He confirmed that £1bn provided to top-up social care budgets this year would be maintained in 2021-22.

The sector will also benefit from over £3bn allocated for local authorities in 2021-22 to meet the additional costs of Covid-19.

In its report on the spending review, the Treasury said: “This will support councils to maintain care services while keeping up with rising demand and recovering from the impact of Covid-19.”

However, it falls short of what sector leaders have called for, with the Association of Directors of Adult Social Services (ADASS) urging £1.3bn for adult social care alone in 2021-22 to meet demographic pressure, in addition to money to cover Covid-related costs.

With councils projecting an overspend on their adult social care budgets this year of almost £500m, ADASS had also called for £2.15bn to cover this and deliver extra support for carers and home care services; however, there was no money announced for 2020-21 today.

Reacting to the settlement, ADASS president James Bullion said: “While we are still examining the detail, it seems as if the fragmented short-term funding announced by the Chancellor falls alarmingly short. We needed funding to ensure that care providers remain in business, staff are paid a national care wage that properly rewards them for their amazing work, and carers get the vital breaks they need to keep going. Social care has so much potential for good, and is falling further behind.”

While the Local Government Association said it welcomed the extra funding for social care, it was insufficient and would mean that councils would “have to find savings to already stretched budgets in order to plug funding gaps and meet their legal duty to set a balanced budget next year”.

LGA chair James Jamieson also criticised the focus on council tax – rather than government grants – as a means of raising funds for the sector, adding: “Council tax rises – particularly the adult social care precept – have never been the answer to the long-term pressures faced by councils, particularly in social care, raising different amounts of money in different areas, unrelated to need. It is not the long-term solution which is desperately needed.”

‘Decidedly reckless approach’

The settlement was also heavily criticised by other sector bodies.

On behalf of Age UK and charity coalition Care and Support Alliance, Caroline Abrahams said: “Today the government passed up the opportunity to play fair with social care, instead granting it insufficient extra money to safeguard the current level of services through next year. Against the context of the pandemic, which is both driving up the level of need, and weakening the finances of providers, this is a decidedly reckless approach.”

Abrahams, CSA chair and Age UK’s charity director, added: “Local authorities are once again being asked to square an impossible circle and this ungenerous settlement does very little to help the NHS either. However, it’s older and disabled people, and their families and carers, who will as ever pay the biggest price, with more likely to have to manage without the support they need. This is a bitter pill to swallow, especially after everything social care has been through this year.”

King’s Fund director of policy Sally Warren said the settlement for social care “falls a long way short of what is needed to meet the needs of service users, their families and carers, let alone reform the system”. The government confirmed that its long-awaited reforms to the system, and its funding, would not be published until next year.

Pay boost for social care workers 

The pay rise, worth £250, for those earning £24,000 or less in the public sector will likely benefit many council social care workers should authorities follow the Chancellor’s lead. Pay will also rise for social care staff in the independent sector as a result of rises to the national living wage (NLW) and minimum wage (NMW), though councils will need to fund providers they commission to meet this from their additional social care cash.

The NLW will rise by 2.2%, to £8.91 an hour, with the age limit for receiving it lowered from 25 to 23, while the NMW for 21- and 22-year-olds will go up by 2% to £8.36 an hour. The rises, recommended by the Low Pay Commission, will boost the pay of many adult social care workers, for whom average pay in the independent sector was £8.50 as of March this year, when the national living wage was £8.21.

However, Warren criticised the lack of funding for a multi-year workforce strategy for health and social care, saying this would “only add to the uncertainty and pressure faced by health and care services”.

On the wider public sector pay freeze, UNISON general secretary Dave Prentis said: “Going after the pay of millions will be a bitter pill for key workers getting the UK through the pandemic and out the other side. The Chancellor wants to pause the pay of care, school, council and other public service workers who’ve been on fast forward all year.”

6 Responses to Extra £1bn for social care but pay freeze looms for social workers in Rishi Sunak’s spending review

  1. Denise Green November 25, 2020 at 7:19 pm #

    Once again we are sidelined, we have worked throughout the whole pandemic period without any recognition. We have supported families in dire need, safeguarded children and adults, provided practical support and put our own lives and families at risk by being exposed when visiting families . But the thanks we get is a pay cut in real terms. This happens repeatedly but no one raises a voice. No wonder people leave the profession in disgust, burnt out by caring

    • Andrew November 26, 2020 at 8:40 am #

      I am sure our leaders will rally to the cause on Twitter. That’s what passes for campaigning and raising a voice these days. We need to come together and stand up for ourselves, these people are not interested in fairness for us.

  2. Chris Sterry November 25, 2020 at 11:29 pm #

    Again a Government in denial and not listening, for Social Care is once more cast aside for £1billion will go nowhere near to cover the increased costs, let alone the usual spending for Local Authorities (LAs) are already more than this in a deficit budget.

    So, once again, it will be those persons in need of social care who will be left to suffer and many will not come through, for deaths will arise.

    Social Care has never been sufficiently, well before the 10 years of austerity cuts and then the increase in costs due to COVID-19.

    The people in need of care can least afford to be without or insufficient social care and more early deaths could well arise, certainly within the learning disability and autism spectrum.

    For, currently, within that spectrum the early deaths are already around 20% lower than those who do not have learning disabilities and/or autism.

    We need to show the Government that they can and should not ignore the crisis in Social Care, for this needs to be solved, without delay.

    It is for this reason, that I ask you to support the petition, Solve the crisis in Social Care,


    Should you require it, further information can be found at


    Please show your support and that you care for those in need of Social Care by signing and then sharing the petition.

    Thank you

    #care #socialcare #crisis

  3. Steve November 26, 2020 at 12:26 am #

    I think an increasing number of public sector employees will look towards early retirement and finding a part time job elsewhere to make up the difference. A least the pension then attracts small rises every year and you are out of the pressure and out of the rat race.

  4. Julia November 26, 2020 at 8:29 pm #

    Well, the money saved from not giving us proper financial remuneration will help the government cover the costs of their own £3330 pay rise next April. Poor things, they are only going to be earning just over £85,000. We are all in this together don’t forget.

  5. peter griffiths November 28, 2020 at 10:10 am #

    If the government can find £1.5 Billion to build a tunnel under Stonehenge they can find 1 Billion to fund a pay rise for PS workers. A decade of cuts to Social Workers salaries and the BASW letting it happen. No wonder we have a national shortage of SWs and why so many are quitting the service