- There are concerns over the complexity of the reforms and the challenges of delivering the fair cost of care and charging elements of the reforms simultaneously. Member boroughs have significant concerns about the deliverability of the reforms within the time frame and the cost envelope provided by the government.
- We believe that the options set out in the consultation require more development and testing within the sector and should be based on further evidence. We are, therefore, calling for the implementation to be pushed back to April 2024.
- We are calling for the reforms to be fully funded so that no authority is financially worse off as a result. If this requires an increase above the £5.4bn earmarked at SR21 then the government should deliver this prior to the next Spending Review.
Below is a summary of the key themes in our consultation response:
The adult social care funding reforms are particularly challenging due to the uncertainty and underfunding that local government has suffered, with London Boroughs’ overall resources still 22% lower than they were in 2010 in real terms. We call on the Government to confirm details of a 2-year local government finance settlement as soon as possible to provide funding certainty and increase local government funding in line with inflation next year for all funding streams other than council tax.
Sufficiency of Adult Social Care Funding
The ASC precept has not delivered funding to where it is needed most, while representing central hypothecation over the only tax councils have any control over. Prior to the Spending Review, we estimated London Boroughs needed an increase of £400m over the SR period to meet underlying demand and cost pressures, not including any ongoing pressures caused by Covid-19; The £5.4bn set out over the SR21 period will not go towards meeting these pressures. It has become clear that not only are the reforms themselves unlikely to be affordable, but that there is still huge uncertainty over the long-term funding of social care. We urge the Government to set out how it plans to meet these pressures as soon as possible, including how adult social care will be funded in the long term if the Health and Social Care levy is scrapped.
The deliverability of the ASC funding reforms
We are concerned that the £3.6bn funding over three years to implement fair cost of care reform, the care cost cap and extension of the means test threshold will be insufficient. As such, we are asking that the government pushes back the implementation of these reforms until April 2024 to ensure the sector had the time and resources to deliver them. If the Government continues with the current timetable for implementation, we ask that allocations for the 2023 Market Sustainability and Fair Cost of Care Fund are discussed and consulted upon with the sector in good time to support financial planning.
Our biggest concern lies with the statistical analysis undertaken by academics at the University of Kent. The proposed formulae are highly technical, and the consultation document fails to explain how the statistical methodology results in the proposals in the consultation, or how the overall weightings between the three elements of the funding have been derived.
Lack of transparency and engagement
We feel that the proposals should have been developed over a longer period of time in collaboration with the sector. It is also concerning that the specific local authority modelling that sits behind the proposals has not been published to allow transparency and proper scrutiny of the proposals.
If the Government is insistent upon implementing on the current timetable, a detailed and robust monitoring exercise should take place to ensure costs are fully funded and a simple process for funding to be increased responsively if the real demand is greater than envisaged in the formula methodology must take place.
Regardless of what funding distribution is chosen – we’re calling for the reforms to be fully funded so that no authority is financially worse of as a result. If this requires an increase above the £5.4bn earmarked at SR21 then the Government should deliver this prior to the next Spending Review.
Proposals for younger adults
None of the options proposed for distributing funding for the extension of the means test for younger adults are convincing. We are especially concerned about the proposal to use the older adult’s formula to distribute the means test extension funding for under 65s due to the markedly different adult social care needs between these two cohorts.
Proposal to use the ASCRU-PSSRU means test extension formula for people aged 65 and over (2022) for distributing means test funding for people aged 65 and over in 2023 to 2024
London Councils disagrees with this proposal. We don’t believe enough justification for the metrics used within the formula has been provided. Specifically, the consultation does not explain, in lay terms, how the detailed and highly technical academic report that sits behind the formula has resulted in the formula and the weightings proposed.
Distribution of means test funding for adults aged under 65 in 2023 to 2024
In the absence of better options, London Council’s prefers to distribute means test funding for adults aged under 65 using the per capita (people aged 18 to 64) distribution formula. This is in preference over the ASCRU-PSSRU means test extension formula for people aged 19 to 64 and the ASCRU-PSSRU means test extension formula for people aged 65 and over (2022).
Distribution of cap funding
London Councils conditionally agrees with the proposal to distribute cap funding in the same way as means test funding for adults aged under 65 in 2023 to 2024, but solely based on whether our preferred option of the per capita distribution formula for adults aged 18-64 is selected.
Distribution of £247 million of funding for assessments in 2023 to 2024
We disagree with each of the proposed options for distributing £247 million of funding for assessments in 2023 to 2024, which include:
Option 1 – ASCRU-PSSRU assessments formula (utilisation approach) 2022
Option 2 – ASCRU-PSSRU assessments formula (normative approach) 2022
Option 3 – ONS estimates on the number of self-funders
We instead reiterate that the reforms should be paused to address the underlying issues with the formulae construction and data quality and availability issues.
A great deal of the formulae uses data from Census 2011, not Census 2021, upon the justification that datasets at LSOA level have not yet been published. London Councils contends that there are greater methodological concerns with the use of the Census 2021 figures as they currently stand – namely population undercounting because of when the census was held during the third lockdown of the Covid-19 pandemic. Therefore, before these formulae are introduced, and subsequently updated when this Census data becomes available, it should be ensured that any methodological issues have been addressed.