Councils boost social care budgets by £700m but say they are ‘plugging gaps in an underfunded system’

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Councils have increased their social care budgets by £700m this year in real terms but are warning that pressures on children’s and adults’ services require urgent government action.

Authorities have budgeted to spend £31bn across both services in 2022-23, £19.7bn on adults’ services and £11.2bn on children’s, according to Department for Levelling Up, Housing and Communities figures.

Budgeted spend for children’s social care is up 3.2% (£348m) above 2021-22 levels, while for adult social care, it has gone up by 1.8% (£351m), with most other council services seeing real-terms cuts.

In response to the data, the Local Government Association and Association of Directors of Children’s Services said they showed the substantial scale of the pressures facing authorities across both services but stressed that existing funding levels were inadequate.

Councils ‘plugging gaps in underfunded system’

“Demand for adult social care has been increasing for some time, and as we can see by these statistics it shows no sign of letting up. Inflation and cost of living pressures have added to the cost of delivering social care, but ultimately councils are trying their best to plug the gaps in an underfunded and unstable system,” an LGA spokesperson said.

“Meanwhile council spending on children’s social care has risen by a quarter in five years, and as these figures show, this will be continue to increase. This is indicative of the spiralling costs and increased demand for support councils are trying to meet to protect vulnerable children and their families.

Chris Munday, chair of the ADCS’s resources and sustainability policy committee, said that, in the context of high need and the impact of the pandemic and the cost of living crisis, councils were having to “prioritise spend on children’s social care to support those who need it”, which had a knock-on impact on early help and family support.

“This is challenging for local authorities who continue to make increasingly difficult decisions about many services that children and families rely on including early help and prevention services that can reduce demand for statutory child protection services,” he added.

Increased cash for local authorities

The government has provided additional funds for social care in 2022-23, by:

• enabling authorities to raise council tax by 2% without the need for a local referendum;
• allowing them to raise the adult social care council tax precept – which is ring-fenced for the sector – by 1%, or by more if they have not made maximum use of the precept in previous years;
• increasing its social care grant – which can be spent on adults’ or children’s services – by £636m to £2.346bn;
• a 4.4% rise, to £7.2bn, in the Better Care Fund, a combination of government grants to councils and NHS resources, designed to fund services to help adults remain independent at home for longer.

However, a string of reports – including from council leaders and MPs – has warned that this has left adult social care underfunded in the short-term, amid growing workforce shortages, waiting lists for assessments and care packages and concerns that councils will not be able to fulfil their legal duties.

Sector leaders have also repeatedly argued that councils are underfunded to implement the government’s adult social care funding reforms next year, which include an £86,000 cap on personal care costs, more generous means-test for accessing care and provisions enabling self-funding care home users to access placements at local authority rates.

Call to delay adult care reforms

The LGA spokesperson repeated the association’s call for the reforms – due to come into force in October 2023 – to be delayed by six months, to give councils and providers more time to prepare and for more evidence to be gathered about their cost.

In relation to children’s social care, the Department for Education is working on its response to the Independent Review of Children’s Social Care, which called for £2.6bn to be invested in services over the next four years, to engineer a shift in focus towards family support and kinship care. It also urged action to tackle profit levels and prices in the care placements market, through the creation of regional care co-operatives to commission care on a larger scale in order to drive down costs.

Munday added: “The independent review of children’s social care found that the sector is under-resourced to carry out critical tasks to enable children to flourish and that the children’s placements market is broken. We urgently need a sustainable, long-term funding settlement for children’s services and government intervention into the placements market, otherwise children’s outcomes continue to be placed at risk. We urge the new prime minister to prioritise spending on children, they are our present as well as our future.”

The LGA spokesperson said the mounting costs of children’s social care – as revealed by the budget figures – “underlines the urgency for reforming children’s social care and for government to work with councils and move quickly to address the issues raised in the recent independent review, in particular workforce shortages and a lack of suitable homes for children in care”.

The DfE is due to issue its response to the care review by the end of the year. The LGA said it should publish a white paper – a document setting out firm policy proposals – within six months “to demonstrate the government’s commitment to reform, and truly transformational investment by the Treasury in the services that give all children the best start in life”.