Social Care Reform – Now the dust has settled, what does this actually mean?

Last week the government announced an increase in funding for social care in England.

What was the announcement?
The government announced that the health and social care reform will be funded by a rise in National Insurance. The National Insurance rate will rise by 1.25% from April 2022 across the UK, which the government says will raise £36 billion over the next three years.

The money raised this way will solely go to the NHS for the first three years. Separately, the government have committed to providing £5.4 billion to social care during this period. From April 2023, the National Insurance rise will then become a separate tax on people’s income, called the Health and Social Care Levy. People of state pension age, who do not normally pay National Insurance, will pay the levy. From April 2023, the money raised will then start to go into the social care system.

The announcement also explained the changes being made to the cost of care, which initially focuses on reducing the cost of care for older people. Instead of the person who requires the care and support paying if their assets are worth above £23,250, from October 2023 an individual would only pay for all their care if their assets were more than £100,000. And people would only start to contribute towards their care if their assets were more than £20,000, not £14,250. The proposals would also set a ‘cap’ on the amount an individual would pay for care in their lifetime.

Now the dust has settled…
Following this announcement, there have been a number of responses from social care leaders and stakeholders about what the effects of last week’s reform announcement actually means.

The National Autistic Society has said “A significant increase in funding for social care in England is a once in a generation opportunity to fix the social care system, something we have been calling for. It could start to make a real difference to the lives of people who need care […] But we’re really worried that we will need to wait three years to see all the funding for social care in place.”

Neil Carberry, CEO of the REC said “It’s vital that the social care system is properly funded – this has been a long time coming. But the 1.25% rise in National Insurance, the UK’s biggest business tax, is the wrong choice. As a tax on jobs, and a tax on activity rather than profits, rising National Insurance will fall more heavily on the labour-intensive sectors most affected by the pandemic.”

Mark Adams, CEO of Community Integrated Care, said “Whilst reducing the cost of care for older people is vital, they represent only part of the community that social care serves. The government has focussed on the recognisable, understood and politically positive aspects of the social care crisis, and failed to recognise the millions of family carers, disabled people and social care workers who have been left behind. This solution doesn’t ‘fix social care’ but instead tidies the tip of the iceberg.”

Social care is a candidate short market, that has been further impacted by Brexit and the COVID-19 pandemic. Our sector has an annual staff turnover of 34.4% – more than double the 15% average rate across other UK employment sectors. Frontline carers take home an average pay of £17,695pa, whereby to be on equal terms with their peers in similar roles in the NHS, they would need a 39% pay rise in order to match this.

Figures like these show just some of the systematic issues this sector faces daily and is why social care needs fairer pay, better funding and a genuine focus on ensuring that every one the sector supports has access to the high-quality care and support they most desperately need.

Wider plans for reform of the social care system, not just funding, are expected to be announced by the government soon. The government will be working with organisations and stakeholders over the coming months on a White Paper for Adult Social Care that sets out its plans.

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