How Spending Review will impact on Social Care-Analysis


Following George Osborne’s Autumn Statement and Spending Review Dr Rhidian Hughes, The Voluntary Organisations Disability Group chief executive, commented:

Overall funding settlement

“The social care funding settlement is woefully inadequate. The spending review offered Government a chance to put social care funding back on track financially yet this important opportunity has been lost. There is very little in the announcement to be welcomed by providers of voluntary sector disability services”.

He went on to say:

“Government’s failure to invest in social care is a disgrace. 1.9 million people require social care aGeorge Osbourne-care industry newsnd at this time of unprecedented demand for services, coupled with financial austerity, fewer and fewer disabled people are eligible for support. This unmet need is now set to significantly increase”.


“Inadequate resources will force care providers to cut services or cease operating altogether, leading to an increased pressure on NHS emergency and hospital services. The welcome investment in the NHS will vanish before our eyes. At this time, more than ever, we need to build constructive relationships between CCGs and local authority commissioners and disability organisations”.

2% council tax increase

Dr Rhidian Hughes, VODG chief executive, comments:

“The precept in council tax of up to 2% to allow local authorities to raise up to £2 billion by 2019/20 detracts from the reality that £6 billion is immediately required to fund adult social care. Demand for social care is higher in poorer areas, and with concerns about local and regional market failure, Government needs to be alert to the fact that social care markets could fold”.

National living wage

Dr Rhidian Hughes, VODG chief executive, comments:

“The introduction of the national living wage, if properly funded, should have enabled providers to invest in their workforce by building careers in the sector, recruiting and retaining the right staff and paying people at a rate that recognises the value of the work they do. The local authority tax and better care fund get us no-where close to meeting this growing pay bill. Government must now expect reductions in service and workforce development and a contraction in the market. The opportunity to build a strong, capable workforce has been missed, and the system must now concentrate on managing subsequent risks to service quality”.

The Comprehensive Spending Review: Chancellor Fails Social Care Test

Vicky McDermott, Chair of the Care and Support Alliance explained,

“The spending review failed its social care test. George Osborne majored on economic security but comprehensively failed to provide the social care system with a secure long term economic plan.

“The Conservative government was elected on a promise to invest £6bn into social care by 2020. Today’s announcement suggests that the maximum amount the government can hope to raise for social care is under £2bn and even this figure is not guaranteed.  It will mean that the government is significantly short of providing what it promised.

“This may be mitigated to some extent by an additional £1.5bn of funding to Better Care Fund. The Better Care Fund has not delivered thus far for social care, and whilst we welcome additional funding, without significant reform for the fund we are not left optimistic that this will make the difference to the social care system that is desperately needed.

“This is a betrayal of vulnerable disabled and older people and it will increase pressures on the NHS whilst meaning care providers in poorer parts of the country will no longer be able to offer care services”.


Richard Priestley, Executive Director of Retirement Income at Canada Life comments on the increase to the State Pension: “The move by the Chancellor will protect the incomes of pensioners, helping cement the rapid income gains they have enjoyed of late. In the last twenty years, retired households have seen their incomes climb to record highs, up by 77% in real terms. This has far outstripped growth seen by the rest of the population. The state pension alone makes up two fifths of a typical household’s income, so this latest move is a boost pensioners will certainly enjoy.


“For those generations coming along behind, the picture may not be so rosy as they face more of an uphill battle to fund retirement. Defined benefit pension schemes which provided a guaranteed income linked to salary will gradually disappear altogether. This means savers will have to take more responsibility for their own retirement, though the government is capping the amount they are allowed to build up in their pension funds. Prospective retirees must consider long-term saving early enough in their careers to ensure their standards of living match those of the current retired generation.”

Mark Stopard, Head of Product Development, Partnership commented:

“Today’s Autumn Statement covered a significant amount of ground but did not pull many retirement rabbits out of the hat!

“One area of interest was the Chancellors announcement that local authorities would be allowed to increase council tax by up to 2% to cover adult social care costs.  While on the surface this may seem like a boon, the introduction of the living wage in April 2016 will see the cost of employing over-25s to provide care service increase by 7% so even with this increase, some local authorities will be out of pocket and struggling more than ever.

“Choosing to sell assets to support costs such as adult social care may be one consideration but it is not necessarily sustainable in the long term.  Indeed, the number of people over 85 in the UK is predicted to more than double in the next 23 years so the challenges of meeting care funding costs will only grow.”

Quentin Cole, healthcare partner at PwC, said: “The Chancellor’s emphasis on achieving an integrated health and social care system by 2020 is to be welcomed. The Spending Review has acknowledged the scale of the challenge facing the NHS and made good on the deal struck on the Five Year Forward View. But no-one should kid themselves. The extra resources, though very welcome, only provide a breathing space. It’s now for the NHS to deliver its part of the deal and find the £22 billion efficiency savings promised, as well as managing a 25% cut in the Whitehall budget of the Department of Health.

“New models of care must be focused around outcomes for patients and the population, requiring the whole system to work as one. This will pose new challenges with governance, statutory boards, commercial risk and regulation all currently sitting within independent organisations.

“The challenges facing the NHS cannot be solved by organisations working in isolation. The additional investment in the Better Care Fund along with the social care precept will help enable the health and social care integration necessary. While a long-term solution is still needed for funding care in old age, this welcome step should allow health and social care to work with each other rather than against one another.”

Alan Frew, founder and managing director of home care specialist, Community Life Choices commented:

“Mental health care is one of the biggest unmet needs of our time and it’s promising to see the chancellor pledge a further £600m in funding. What he failed to address is how we’re expected to raise standards when local authorities in England spend just one per cent of their annual health budget on tackling these issues.


“Personalised home care support for just one individual saves the taxpayer around £90,000 a year compared to residential stay costs. Yet ministers can do more to increase these savings even further.


“In order to achieve this, individuals with chronic health needs require better support in managing their own health budgets and integrating them back into the community. However, this requires the Government to address the lack of knowledge and experience amongst its healthcare commissioners. Providing these individuals with fundamental skills will give those with mental health conditions greater choice and control, reduce their reliance on funding and ultimately improve standards.”










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