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Paul Burstow: LGA must boldly seek solutions to care's cash crisis

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The NHS is celebrating its 70th birthday, a party is planned and the prime minister is baking a cake full of extra cash. Amidst all the celebrations, including a 20-part series on the BBC, what about the NHS’s unloved sibling, social care? Will there be any crumbs left to fix our broken social care system on its 70th birthday?

Over the weekend Theresa May confirmed the size of the cash injection the NHS will receive from the government. Before the announcement the indications were that social care was struggling to gain traction in the wrangling between the Department of Health & Social Care, No 10 and the Treasury. In his statement to Parliament on Monday, Jeremy Hunt confirmed that social care will be left holding the candles.

Yet a large investment in the NHS that ignores social care is unlikely to address the drivers of increased demand and cost. In its fiscal risk reports, the Office for Budget Responsibility points to longevity and multi-morbidity as the big drivers of demand. So delaying the green paper until the autumn to align with the new NHS 10-year plan could be a good thing.

Supporting people to maintain their independence, to stay socially connected and physically able, requires both investment and innovation in social care. Investment in what keeps people healthy, connected and using their strengths in strong and caring communities is what will ultimately reduce pressure on acute services.

A recent report for Skills for Care demonstrates the value to our economy of social care, £46.2bn a year, directly employing 1.6 million people. Social care is an essential part of the nation’s economic infrastructure.

But how do we pay for it?

That is the question ministers are still wrestling with and the sound of a tin can clattering down the road suggests without success so far. The question is how to break the news to the British people that we must spend more on social care and we must pay for it. The Institute for Fiscal Studies say that just to maintain current levels of provision by 2033-34 the share of the nation’s wealth going into social care needs to rise from 1.1% to 1.5%.

There are two questions. One, how much more is required to create a social care system that is fit for purpose? Two, how do we raise the money?

The recent report of the Institute for Fiscal Studies and Health Foundation for the NHS Confederation goes some way to answering the first of these questions. And the recent Association of Directors of Adult Social Services budget survey has cast further light on the scale of the immediate funding pressures faced in town halls. Almost one in three directors report that home care providers are handing contracts back and the survey highlights market failures and fragility are growing.

But how do we raise the extra money? My own view is that the fairest way to raise the extra money needed is through general taxation, perhaps through hypothecation of a reformed National Insurance. On top of this there is still a place for personal responsibility. The means-testing arrangements for social care are long overdue reform. Putting in place a Dilnot-type cap and a more generous capital floor would help to make the system fairer for individuals.

Still the temptation in HM Treasury is to argue that the time is not right, keep kicking the can down the road. Leave it to the next lot to sort out. The response from local government has done little to help. The extra money needed should not be raised through the council tax says the Local Government Association. But how it should be raised? Silence.

It is tough. Social care has not stayed resolutely stuck in the mud for nothing; it is a classic wicked issue. For 30-plus years successive governments have ducked this question for fear of upsetting one interest or another. Royal commissions, green and white papers have come and gone. The inescapable fact is the costs of our longer lifespans need to be paid. They land on families, on business and on an NHS still ill equipped to cope with the needs of people living with multi-morbidity.

So how could the LGA help? Being clear about what you are against is not sufficient. The LGA must use the delay in publishing the green paper to help create the conditions for a lasting settlement by modelling the sort of cross-party consensus building necessary to put it in place. The danger is we end up with the government offering yet more sticking plasters rather than a funding settlement that stands the test of time.

If the LGA were to make the case for a set of funding reforms to pay for social care it would put pressure on national politicians, it might even give them some cover to do the right thing.

The prime minister’s £20bn boost for the NHS would go so much further if social care and public health received a boost too. It is not too late. There is a Budget to come. The LGA must do more than describing the problem, it needs to make the case and mobilise support for a solution too.

Paul Burstow, chair, Social Care Institute for Excellence; social care minister 2010-2012

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Readers' comments (2)

  • The money was meant to be raised through the end of contracting out and freezing IHT thresholds - oops! raised to £1m...!

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  • Get rid of inheritance tax threasholds with all the wasteful estate planning and avoidance that goes with it, then introduce a 20% tax on 100% of any inherited wealth including trusts etc and ring fenced it to social care which is free at the point of use at a basic level. People could then if they wish fund insurance or equity release on assets to top up the basic provision if they wish to a higher standard of care. NHS hospital trusts could be instructed to develop in house run care homes and home care locally with staff paid well and trained, and the private sector could compete on quality and price for those self funding by topping up a basic care allowance paid if they qualify for care but do not want to use the free nhs service and wish to top the allowance up. Care for people with learning difficulties and mental health should be in the nhs budget.
    This has the advantage of
    universal provision
    removal of profit margins and costs for state funded care
    gets rid of charging and co payments
    builds supply side capacity
    a fair tax funded approach
    sustainable
    encorages insurance and self funding by topping up basic provision
    cuts out commissioning costs and pressure on LA budgets
    takes away fear for people worried about the future for their care and the financial future of their children

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