County councils look set to be the biggest beneficiaries after housing and communities secretary Sajid Javid announced he will provide an additional £150m for adult social care services in 2018-19.
The money is to be “taken from anticipated underspend in existing departmental budgets and will not affect existing revenue commitments made to local government,” said Mr Javid.
In his written ministerial statement on the final local government finance settlement, issued today, Mr Javid added: “[The adult social care support grant] will be allocated according to relative needs and we will expect to see councils use it to build on their progress so far in supporting sustainable local care markets.”
In addition, Mr Javid has also increased the rural services delivery grant to £81m - £16m more than proposed in the provisional settlement.
The extra funding comes after backbench Conservative MPs piled pressure on the government to provide more funding for rural areas. MPs are due to debate and vote on the final settlement on Wednesday.
According to analysis of the final allocations by Pixel Financial Management, county councils will receive £56m (or 37%) of the additional social care and rural funding, London boroughs £23m (15%), metropolitan districts £37m (25%), and unitary councils £34m (23%).
Local Government Association chair Lord Porter (Con) described the extra £150m as a “temporary measure” in the context of the projected social care funding gap of £2.3bn by 2019-20.
He added: “Councils in England face an overall funding gap that will exceed £5bn by 2020. We remain clear that the government needs to allow local government to keep every penny of business rates collected to plug this growing funding gap and provide the £1.3bn needed right now to stabilise the care provider market.”
County Councils Network chair Paul Carter (Con) welcomed the extra £150m for social care but added: “While this funding provides some new resource for this coming financial year we must continue to work with ministers, who understand the enormity of the financial challenges facing counties, to deliver a long-term sustainable and fair funding solution to meet the estimated £2.54bn funding gap for counties.”
District Councils’ Network chair John Fuller (Con) said the government had not acknowledged the role of districts in reducing demand on high cost social care services by allowing further flexibilities on council tax.