Care and Support Funding Reform - Cost implications for London

  • By admin

The government has announced that from April 2016 a cap will be introduced limiting the amount of money people will have to pay towards their care. This cap will be set at £72,000.The government will also raise the means testing threshold at which people are eligible for support from local authorities, from the current £23,250 to £118,000. London Councils has analysed the cost implications of these reforms, illustrating the additional cost pressures that can be expected by London boroughs.

Cost pressures in London

London Councils’ analysis has found that the potential total additional cost pressure that local authorities could be faced with by 2019/20 as a result of introducing the cap and raising the threshold AND the on-going social care cost pressures is approximately £1.3 billion. Approximately £8771 million of this will be as a direct result of implementing the capped cost model for care and raising the eligibility threshold over the first four years.

National cost pressures

The government‘s estimates of providing £1 billion per year to fund the funding reforms nationally is inadequate. London Councils’ analysis has found that the reforms nationally over four years will cost in the region of £6 billion – on average £1.5 billion per year(cost pressures will be heavily weighted in the first and fourth year of implementation).

This report explores some of the cost implications that the proposals for funding reform will have in London. At the time of writing the report government had not published all the data that would enable a complete analysis to be done for example the different levels of the contribution cap that will apply to working age adults.