Short-term funding and lack of a long-term vision hampering adult social care, watchdog warns

Public spending scrutiny body says planning, innovation and investment are being stifled by funding issues and Government policy, and that current accountability and oversight arrangements are “ineffective” for overseeing the care market.

25/03/21

Short-term funding and lack of a long-term vision hampering adult social care, watchdog warns

Short-term funding and the lack of a long-term vision has hampered planning, innovation and investment in adult social care, a public spending watchdog has warned.

In its report ‘The Adult Social Care Market in England’, the National Audit Office (NAO) also says that current accountability and oversight arrangements are ineffective for overseeing the care market.

Although adult social care regulator the Care Quality Commission (CQC) rates most care providers as ‘Good’, the NAO says the Department of Health and Social Care (DHSC) “lacks visibility of how effectively local authorities commission care and the outcomes achieved.”

The NAO also complains that the regulator has no legal powers to intervene or hold individual authorities to account.

This limits the DHSC’s ability to assess how well money is being spent, or what additional funding is needed to support care users, the NAO says.

The report also finds that the DHSC has not met previous commitments to tackle recruitment and retention challenges for the 1.5 million people who work in care, having not produced a workforce strategy since 2009, despite committing to do so in 2018.

The DHSC says that a workforce strategy would be dependent on the next spending review and wider reforms committed to in the recent white paper.

The report finds that DHSC “does not have a clear strategy to develop accommodation for adults with care needs and does not monitor the condition of current accommodation itself.”

“Uncertainty about future funding and care policy mean providers are reluctant to invest in accommodation. Funding for new investment is ad-hoc with no co-ordinated, long-term vision across government about how new accommodation will be developed or existing accommodation adapted to meet care needs,” the report reads.

The NAO says short-term funding settlements have hampered long-term planning for adult social care.

“Uncertainty has made it difficult for local authorities, facing significant financial pressures, to plan how much care they could purchase beyond the current financial year, constraining much needed innovation and investment.”

The collapse of Southern Cross in 2011 highlighted the need for Government to develop a system to address serious provider failure, however, the report found that councils could benefit from more access to the CQC's oversight of provider finances across the care market.

“Since 2015, CQC has overseen the financial sustainability of around 65 difficult-to-replace care providers, representing around 30% of the overall care market by number of beds. Currently local authorities do not benefit from CQC’s analysis and monitoring until it notifies them that a provider is likely to fail, and service cessation is likely,” the report said.

The report also found that many care providers were not financially resilient before the pandemic – meaning they could be at risk of collapse – and the impact of COVID-19 could have further consequences.

Analysis by CQC of the large providers indicates that government support has helped to stabilise the market but falls in occupancy, from around 90% pre-pandemic to 80% in February 2021, raises concerns that ongoing support may be required.

There are likely to be large increases in future demand for care, leading to rising costs, the report found.

The DHSC’s own projections show that around 29% more adults aged 18 to 64 and 57% more adults aged 65 and over will require care in 2038 compared to 2018. Over this period, the total cost of care is also projected to rise by 90% for adults aged 18 to 64, and 106% for adults aged 65 and over.

The NAO says these projections are “highly uncertain” and will depend on changes to the way care is delivered, which the DHSC has not yet assessed.

Despite many years of government papers, consultations and reviews, the DHSC has not brought forward a long-term plan for care – and the pandemic has delayed promised reforms as the Government prioritises the COVID-19 response.

“The lack of a long-term vision for adult social care coupled with ineffective oversight of the system means people may not get the care that best supports them,” Gareth Davies, head of the NAO said.

"The Department of Health and Social Care has increased its focus on adult social care in response to the COVID-19 pandemic. It needs to build on this to ensure that its long-awaited reforms deliver affordable, high quality and sustainable adult social care for the future.”

Responding to the report, the Association of Directors of Adult Social Services (ADASS) Vice President Stephen Chandler renewed calls for the Government to publish its long-awaited reform proposals.

“This NAO report adds to the ever-growing body of evidence highlighting the increasingly perilous state of care markets, ongoing recruitment and retention challenges, and most importantly the impact on people including an increasing number of people with unmet needs. A situation that the onset of Coronavirus has only served to intensify further.

“This is why ADASS, along with other key sector partners, has called for Government to commit to the publication of promised reform proposal prior to the summer parliamentary recess, to end 25 years of inaction from successive governments and to fix social care once and for all."

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