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Social care reform costs similar to improving current 'flawed' system

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Options for fundamentally reforming the social care system will cost between £12bn and £14bn by 2030-31, while providing further funding for the current system would not address its flaws and cost a similar amount, according to analysis by the Kings Fund and the Health Foundation.

Their joint report, published today, said there is a clear choice between an improved means-tested system or placing social care in line with the NHS and free at the point of use for those who need it.

It found retaining the current system and maintaining the current level of provision would require an extra £6bn by 2030-31, but added it would not address issues of complexity, fairness and the “catastrophic” costs for those with long-term conditions.

To retain the current system but return to the level of quality and access to services in 2009-10, while addressing increased demand, would require £15bn by 2030-31.

The report said the introduction of a cap and a floor on care costs, similar to the one proposed in the Conservative party’s general election manifesto, would cost an estimated £12bn.

The introduction of free personal care for all eligible older people would remove a barrier to integration with health services and increase the funding gap in 2030-31 to £14bn.

The analysis also looked at funding options and found adding 1p to all rates of national insurance by 2030-31 would raise enough to fund the introduction of the cap and floor model.

It also found if means tested winter fuel allowance payments were also introduced alongside the national insurance rise, this could cover the cost of introducing free care.

An additional 2p on the basic, higher and top levels of income tax, or 3p on VAT, would generate more than required to fund a care cap and floor or free care.

Increasing only the top and higher rate of tax would require a “substantial” increase in the rate, the report said, with a 3p increase needed just to fund current projected pressures.

The research found public support for hypothecated tax for social care due to perceived transparency, but the report warned revenue would be exposed to any rise and fall in the economy and implementation would be “a major challenge”.

The report said the public need to better understand the problems in social care in order to support reforms, but politicians “are not best placed to provide it”.

It added: “A coalition of organisations, with cross-party support where possible, is required.”

Senior fellow at the King’s Fund Simon Bottery, who was one of the report’s authors, said the case for change is “overwhelming”.

“As the government prepares its forthcoming green paper, at least two alternatives should be on the table – a better means-tested system and one offering free personal care, which would cost similar amounts to implement,” he said. “However, there is no silver bullet - the road to reform will be difficult and costly, whichever option is chosen.”

Responding to the report Izzi Seccombe (Con), chair of the Local Government Association’s community wellbeing board, said: “This report shows that we need big, brave and bold decision-making if we are to tackle the crisis in adult social care, which needs cross-party consensus if we are to succeed.

“The case has been well and truly made that the system is in desperate need of both an immediate injection of money and long-term sustainable funding that secures care and support for older and disabled people now and in future generations.”

With the funding gap facing adult social care set to exceed £2bn by 2020, Cllr Seccombe said: “The government must seize the chance to address these challenges in its green paper and deliver reforms to future-proof adult social care.”

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