Care-less Budget

I wrote last week that the Chancellor Reeves’ Autumn Budget offered little in the way of the reform much needed in our education sector. Well, it seems that what is “thin gruel” for education is not much better for our health and social care sector. 

The Impact of the Budget on Health & Social Care

Care Forum Wales also hit out against the budget last week and said that the measures announced by the Chancellor pose a “greater threat than covid”. They were joined by Steve Darling, Lib Dem MP for Torbay, who said that the decision to raise employer NICs would exacerbate the impending crisis facing health and social care.

A green light from the IMF, and tax levies that will seldom impact the poorest in our society, the Chancellor did well in the dire circumstances the UK finds itself in. However, with 40 care homes forcedto close post-covid, and a new £150m funding hole to plug, Care Forum Wales has shed light on what is an uncomfortable reality for the entire sector across the UK. 

Challenges in Local and National Funding

In October the Institute for Fiscal Studies concludedthat because social care is “the responsibility of 153 local authorities in England…it matters not just how much is spent at a national level, but where it is spent”. Responding to the budget, Joseph Brunswick, Public Affairs Lead at the Royal College of Occupational Therapists, said that there needs to be “much greater investment in community-based care”. In this need, there is a huge problem. 

A policy area that places huge strain on the public purse (The Department for Health & Social Care’s spending in 2022/23 sat at £181bn), and one that has been steadily increasing more than tenfold in real terms since 1950, is exacerbated by the lack of an effective, well-functioning local finance system – where a tremendous mismatch between funding and needs exists. 

Funding is an issue at both local, and national level. Back in March, the House of Commons Public Accounts Committee highlighted the absence of a long-term funding settlement as one of the key barriers to progress and effective planning. This is a crucial step towards fulfilling Labour’s ambition of a National Care Service, and the provision of consistent, equitable, accessible healthcare nationwide. Similar to the NHS, the National Care Service will address the lack of adequate care for those who need it by allowing people to live independently in their own homes. The big idea behind this is placing social care on a level par with the NHS and healthcare, and ensuring there is a transparent, national system for accessing care support. The Labour Party, however, have not yet revealed any details on how this is to be implemented, delivered, or, in fact, governed. 

Without the bedrock of a well-oiled, healthy local government finance system, how can the Labour Party look to a new era of health and social care reform? Dr Clarissa Giebel asks if this is just ticking a box, and that, like with education, Labour’s plans for the sector are too vague and “too brief”.

Consistent service and delivery means funding at every level, and, currently, the local funding system rests on formulas created in 2013, with data as old as 2001. The IFS recommends that the least the government could do in an effort to ‘blanket’ the nation with effective social care delivery is to fix these formulas and developing new ones that better assess councils’ needs. 

Due to an ageing population and growing demand for care services, the Office for Budget Responsibility projects that spending would need to grow by 3.1%per year over the next decade just to keep up. Effective local funding means that this spending growth will not just equate to ‘throwing money at the problem’, but actually injecting cash where it is needed. 

The Chancellor shouldered some tough decisions in the budget, but, so far, the Labour Party’s policies have fallen short of the wholesale reform and overhaul that the education and social care sectors desperately need. What is clear, however, is that this reform must begin with making small, but crucial changes to local funding.  

Archie Rankin is a Fellow and the Assistant Director of Global Cooperation at the Sixteenth Council.