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Millions to be diverted to social care from new homes bonus scheme

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The government has confirmed changes to local government funding arrangements that are intended to boost the amount of money available for the ailing social care sector.

However, health and social care finance experts reacted with caution, warning that a longer term solution to funding social care was needed to make the sector sustainable and avert future crises.

“The government must understand that this is only an interim measure”

Martin Green

Local authorities have been told today that they can bring forward council tax rises to help cover the costs of social care over the next two years.

Money has also been diverted from a national funding pot designed to encourage councils to drive housebuilding in their areas.

Communities secretary Sajid Javid said today that councils will be able to raise the so-called “social care precept” by 3% in each of the next two years, while £240m is to be diverted from the “new homes bonus” to fund social care services.

The government is also going to introduce a 0.4% growth target from next year so local authorities will only receive new homes bonus payments on housing built above that baseline.

Sajid javid

Sajid javid

Sajid Javid

In 2018-19 ministers will consider withholding payments from councils that do not meet planning performance targets, said Mr Javid while delivering his local government finance settlement to MPs.

Mr Javid told the Commons that the new homes bonus reforms would “release important funding for adult social care”.

Increasing the social care precept, which had been widely trailed earlier in the week, is expected to generate up to £208m in 2017-18, and £444m in 2018-19, said Mr Javid.

Under previous government rules, councils that provide social care to adults were allowed to increase council tax by up to an additional 2%.

“While this announcement is a step in the right direction it does not go far enough”

Stephen Dalton

As a result of the announcement today, this bar has now been raised to 3% during each of the 2017-18 and 2018-19 financial years.

The extra charge, called the “adult social care precept”, was introduced by former chancellor George Osborne last year and is ring-fenced to help fund care for older people and disabled people.

The Department for Communities and Local Government has yet to publish documents accompanying the settlement.

However, a spokesman confirmed to Nursing Times’ sister title Local Government Chronicle that the precept changes meant councils would be able to raise a precept of a maximum of 6% over the course of the parliament with a maximum increase of 3% in any one year.

Mr Javid claimed the precept changes along with the £240m fund would mean an additional £900m for social care over the next two years.

“The social care crisis is already here”

Nigel Edwards

Mr Javid highlighted variations in areas’ performance in relation to delayed transfers of care and he said an integration and Better Care Fund policy framework would be published “shortly”.

But the largest representative body for independent providers of adult social care warned that the policies announced today represented only an “interim measure” and that systemic change was needed to “future proof” the sector.

Professor Martin Green, chief executive of Care England, said: “While any new money to social care is of course welcome, the government must understand that this is only an interim measure, and is a figure below that which the sector believes is necessary.

martin green

martin green

Martin Green

“The government must look to work urgently with the social care sector to create a better system for the long term,” he said.

Professor Green added: “It is important to remember that this money will provide a temporary injection, but will not future-proof this sector. There has to be better accountability of how local authorities spend the precept.”

Stephen Dalton, chief executive of the NHS Confederation, expressed similar sentiments, arguing that ministers must not ignore warnings of a “crisis in social care this winter”

“While this announcement is a step in the right direction it does not go far enough,” he said.

“A shortage in adequate social care puts real pressure on hospitals as more people end up in accident and emergency, and cannot be discharged when they are fit and ready to go,” he said.

“This relatively small cash boost fails to address the long-term funding shortfall,” he added.

Stephen Dalton

Stephen Dalton

Stephen Dalton

Leading health think-tanks also called the measures a “step in the right direction” and highlighted the need for a longer term funding solution for social care.

Nuffield Trust chief executive Nigel Edwards said: “Today’s local government funding settlement makes a small start in addressing the funding gap in social care.

“We and many others said that the autumn statement’s failure to address this was a huge oversight, so the extra funds announcement today must be welcomed as a step in the right direction,” he said.

“But in the context of the true scale of the crisis unfolding in social care, today’s announcements are relatively small,” he said. “They will only amount to filling around a quarter of the £1.9bn funding gap facing social care next year alone. The funding announced today simply pushes back the problem to later on this parliament.

Richard humphries

Richard humphries

Richard Humphries

“With over 400,000 vulnerable older people over the last five years losing out on much-needed help to complete basic tasks like getting out of bed or getting dressed in the morning, the social care crisis is already here,” he added.

Richard Humphries, assistant director for policy for the King’s Fund, described the measures as “belated recognition of the huge pressures on social care”.

He said a “frank and open debate” on delivering a new way of funding social care so that it was sustainable was “long overdue”.

He said: “The emphasis on the precept risks increasing the inequalities that mean the wealthiest parts of the country can raise up to three times as much as poorer areas. Simply passing the problem to councils to solve is inadequate.”

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