Social care funding rise ‘should deliver tangible service improvements’, says government

Councils told additional resource for 2023-24 'should address discharge delays, social care waiting times, low fee rates, and workforce pressures'

Image of compass arrow pointing to word 'improvement' (credit: Coloures-Pic / Adobe Stock)
(credit: Coloures-Pic / Adobe Stock)

An increase in adult social care funding next year should deliver “tangible improvements” to services, the government told councils today.

Authorities should use the 2023-24 package, which the government said amounted to a real-terms increase, to go beyond tackling inflationary pressures to addressing key sector challenges, according to the Department of Levelling Up, Housing & Communities (DLUHC).

These included “discharge delays, social care waiting times, low fee rates, and workforce pressures”, said the DLUHC, after the levelling up secretary, Michael Gove, announced the provisional local government settlement in a parliamentary statement today.

The settlement provides further details on the package announced in last month’s autumn statement by chancellor Jeremy Hunt, when he delayed, for two years, the cap on care costs and associated charging reforms, in order to release cash to help councils meet current pressures.

How 2023-24 council funding settlement for breaks down

The government said it would be providing an additional £2bn in social care grant in 2023-24 compared with 2022-23, though most of it is not new money. It includes:

  • £1.345bn for the existing social care grant, which can be spent on adults’ or children’s services. Most of this (£1.265bn) is recycled from delaying the cap on care costs and associated reforms and will be distributed according to the existing adult social care relative needs formula. The remaining £80m is designed to compensate authorities who have less ability to raise money through council tax, given the government’s increasing reliance on this as a source of funding (see below).
  • £400m for adult social care to spend on making improvements to services. This will be combined, in a new grant, with £162m in existing spending to support councils in paying providers a fair cost of care, and also distributed in line with the relative needs formula.
  • £300m for adult social care to support hospital discharge. This will need to be pooled, within the Better Care Fund, with a further £300m to support discharge, likely channelled through the NHS.

Also, authorities will be able to raise council tax by 3% (up from 2%) and the adult social care council tax precept by 2% (up from 1%), without a referendum of citizens. If councils take full advantage of this, this should raise about £500m more in 2023-24 than 2022-23, some of which will be ring-fenced, through the precept, for adult social care.

According to think-tank the Institute for Fiscal Studies, councils with social care responsibilities will be able to increase their total budgets by up to 5.8% in real terms (9.2% in cash terms) in 2023-24.

‘Government has listened’

Michael Gove

Michael Gove (credit: HM Government)

In his statement, Gove said: “Adult and children’s social care services provide crucial support to care users and young people in need, and this proposed settlement provides significant additional funding for this key area of concern.

“Government has listened, and we know that many local authorities are already facing difficult decisions brought on by inflationary and demand pressures.”

The areas the DLUHC has slated for improvements in adult social care constitute either longstanding or increasing pressures on councils and providers:

Settlement ‘falls significantly short’

ADASS joint chief executive Cathie Williams said the settlement fell “significantly short” of the extra £7bn a year chancellor Jeremy Hunt had said the sector needed in his previous role as chair of the health and social care select committee.

She added: “It will help councils to reduce what could have been additional cuts to help deliver savings needed next year and in that context is welcome. But people should be under no illusion that it will address the vast amount of unmet, undermet and wrongly met needs or really establish social care as the essential service that we all depend on to live, to work and to care.”

In response to the proposed settlement, Local Government Association chairman James Jamieson said it would help councils deal with cost pressures.

However, he added: “Underlying and existing pressures remain for councils and many still face significant challenges when setting their budgets and trying to protect services from cutbacks.”

Concerns over dependence on council tax

County Councils Network finance spokesperson Carl Les also welcomed the settlement but raised concerns about its dependence on authorities increasing council tax.

“The increase in resources will go a significant way to easing the financial pressures facing councils next year but CCN member councils still face very tough budget decisions next year,” he said.

“Moreover, achieving the maximum increase in CSP is reliant on councils raising council tax by 5%. Any council tax rise during the current cost of living crisis is a difficult choice but is one the majority of our councils will need to take to ensure they can maintain vital frontline services.”

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2 Responses to Social care funding rise ‘should deliver tangible service improvements’, says government

  1. Anonymous December 20, 2022 at 6:56 pm #

    A short term boost is not the solution. A classic example that the government doesn’t actually understand the problem. Better financial decisions would be made with long term investment.

  2. Christine Earwaker December 21, 2022 at 9:24 am #

    Unless, they increase care giver wages to above living wage they will never recruit enough staff to enable more providers to take more patients out of hospital