MPs call for sustainable funding solution for adult social care

A joint report from the Housing, Communities and Local Government and Health and Social Care Committees calls for a sustainable funding solution for adult social care.

Setting out the state of social care at present, the report then goes on to present six key principles which the Committees suggest should underpin any decisions about the funding of social care going forward. This is then followed by more specific recommended options.

The report also draws attention to the growing need to plug the funding gap, with the current estimation standing at £2.5 billion. Following this, it states that at both a national and local level, wider funding reforms will be introduced, with the long-term objective being to provide social care which is free at the point of delivery.

It comes in the run up to the publication of the Government’s Green Paper, which is now expected in the Autumn.

The six key principles identified by the Committee are as follows:

  • Good Quality Care
  • Considering working age adults as well as older people
  • Ensuring fairness between the generations
  • Aspiring over time towards universal access to personal care free at the point of delivery
  • Risk pooling – protecting people from catastrophic costs, and protecting a greater portion of their savings and assets
  • ‘Earmarked’ payments

Whilst the aim is for the above principles to form the foundation of any long term plans where social care is concerned, the pressure and prime focus of the report’s conclusions are in the funding to support this.

A key recommendation is the introduction of a ‘Social Care Premium’; this would either be an additional element of National Insurance or with the premium paid into a dedicated not-for-profit social insurance fund.

The report states that the premium should only be paid by those aged over 40 and extended to those over the age of 65 in order to ensure fairness between the generations. To build public trust and acceptance of the measure, it goes on to state that the money would be held in a dedicated, independent and audited fund.

In terms of regular contributions, the report states that employers and individuals should pay into the dedicated fund.

Another funding reform set out in the report relates to Inheritance Tax, recommending that in order to spread the cost of social care, a specified addition amount of IHT should be levied on all estates above a certain level. In addition, it also recommends that this should be capped at a percentage of the total value, with the monies raised used to support the relevant funds until the level of Social Care Premium meets demand.

The report also stresses the vitality of the personal elements of social care, stating that help with everyday things such as dressing, eating and washing should eventually be delivered free to all who need it. However, it does state that accommodation costs should still be paid on a means-tested basis.

As the Committees acknowledges the unlikelihood of this being possible at present, they suggest that for the time being, free personal care should be extended to people deemed to have ‘critical’ needs.

It goes on to state that in order to extend the care to those with moderate needs, extra funds will need to be raised. This is to ensure sufficient resources are provided to make this possible, as well as supporting the workforce and financial viability of care providers.

Acknowledging that the challenge is not simply addressing the existing gap, but to meet future need also, the Committees recommend that an independent body should be tasked with modelling requirements and providing the Government with forecasts every two years.

Commenting on the prospect of funding social care for the future was Clive Betts MP. The Chair of the Housing, Communities and Local Government Committee said: “The social care system is in a critical condition and there is an urgent need for more funding both now and in the future to ensure people are properly looked after. While we have set out steps to ease the financial pressure on local authorities delivering the service, reforms at a local level will not be enough if we are to rise to the challenge of providing high-quality care for all those that need it.

“We heard during the inquiry that people would be willing to pay more if there was an absolute guarantee that the extra money would go on social care. Given the huge funding gulf, the Government should now take the opportunity to build both a political and public consensus around the need for a new Social Care Premium to secure a fair and sustainable system in the long-term.

“The Government must also consider social care in its wider context and ensure a proper joined up approach with other services such as public health and housing.”

Also sharing her thoughts was Sarah Wollaston MP. The Chair of the Health and Social Care Committee said: “We can no longer delay finding a fair and sustainable settlement for social care. Too many people are being left without the care and support they need and it is time for decisions to be made about how the costs are shared.

“This report from MPs across the political spectrum also draws on the informed views of a Citizens’ Assembly in setting out our recommendations to Government. Doing nothing cannot be an option.”

The report can be accessed here.