This January, the Public Accounts Committee sought written evidence on the financial pressures being experienced by local government. The Committee examines the value for money of Government projects, programmes and service delivery.
The Homecare Association responded to the call for evidence. Our submission invited the Committee to explore, with relevant officials, the following six questions:
- What did the Government consider in its impact assessment of the Autumn Budget measures in relation to social care?
- What evidence is there that the deficit identified in the Fair Cost of Care exercises has been addressed? Is this evidence convincing? What are the plans to address this?
- How does the Government plan to account for predictable increasing need for social care services?
- How well does the Government understand the human and financial risks associated with provider failure in the social care sector?
- How does the Government plan to estimate and meet social care costs arising from provisions in the Employment Rights Bill?
- What assurance does the Government have that underfunding social care is not making the Government complicit in modern slavery, negligence and labour exploitation?
The Committee has published their report. They found local authorities spent over £72.8 billion in 2023–24, of which 58% went on adult and children’s social care. With some local authorities spending as much as 80% of their budget on these services.
In addition, increases in national insurance contributions may have a significant impact on social service providers, particularly smaller charities. Yet neither the Ministry of Housing, Communities and Local Government (MHCLG) nor HM Treasury has assessed the impact.
The inquiry found that local authorities may not have capacity to plan for and implement the government’s planned reforms and that plans for adult social care may need to be adapted once the independent Casey Commission reports back in 2028.
Recommendations include:
- As part of the multi-year funding settlement in autumn 2025, MHCLG must work with other departments to implement its plan to simplify funding across the system, including the consolidation of cross[1]government grant funding to local authorities
- HM Treasury should write to the Committee to provide more detail on how the next local government finance settlement will support greater investment in prevention, and how this can be done without just relying on more ringfencing.
- Before the local government finance settlement, MHCLG working with HM Treasury should carry out a post implementation review of the increase in National Insurance Contributions.
