Residential Care: Cost Cap

Baroness Walmsley Excerpts

Thursday 10th December 2015 Lords Chamber

[Baroness Walmsley (LD)]

My Lords, I, too, thank the noble Baroness, Lady Wheeler, for allowing us to have this very long-awaited debate. There is so much to say about this issue that one hardly knows where to start. So many excellent points have been made in this debate. I think we all agree with the right reverend Prelate the Bishop of Bristol that this is about people. We must always bear that in mind.

The main point I want to make is that failure adequately to fund social care does not just impact on those people whose needs are currently not being met at all or only partly so, and their families, important though that is. This failure affects all of us now and in future. Although we will not all need social care in future, we all at some time will need the services of the NHS. The failure to deal adequately with social care is already impinging on the sustainability of the NHS and will continue to do so to an even greater extent in future unless something is done. The Government must not plan on a budget surplus by 2020 if it is at the expense of vulnerable old people in the short and long term, and the viability of our precious NHS which serves us all. It is simply not right and not logical. If they fail on social care, they cannot claim that the NHS is safe in their hands.

As the noble Baroness, Lady Wheeler, outlined, the unanimity among providers about the facts are impressive so there is no doubt about the impact social care cuts are having on services. In a recent survey from the NHS Confederation, 99 % of NHS leaders said social care cuts are increasing the pressures on the NHS and the most prominent impact noted by four out of five of them was the increased time people remain in hospital. This is not new, and many noble Lords mentioned it. For a number of years now, the Government have been alerted to this and yet spending pressures continue to be tolerated. The 2015 spending review finally recognised the funding gap but the remedies are totally inadequate. The Five Year Forward View developed by NHS England and the other NHS arm’s-length bodies is clear that plans for addressing the NHS funding gap are based on an assumption of social care services being sustained. So the ability of the NHS to make unprecedented savings in this Parliament relies on the Government addressing the social care funding gap. If the Government choose not to close that gap, they are choosing not to support the delivery of the Five Year Forward View.

As my noble friend Lady Brinton said, directors of adult social services estimate a £4.3 billion gap by 2020-21. The spending review proposals are unlikely to cover this or the inevitable additional costs of the introduction of the euphemistically named “national living wage”. I absolutely agree with the comments of the noble Lords, Lord Turnberg and Lord Lipsey, about that. Neither will it meet the future growth of demand due to our ageing population. In addition, as we have heard, the Government have back-loaded the better care fund until towards the end of the Parliament. By that time the system will have collapsed—the money is needed now.

Local authorities and social care providers are somehow expected to fill the gap. Many local authorities have prioritised social care. We heard from the noble Baroness, Lady Redfern, about North Lincolnshire. I think that many of us will want to move to Utopia, otherwise known as North Lincolnshire, before we get much older. It currently accounts for 35% of its total budgets compared with 30% at the start of the last Parliament. Spending on adult social care has already been reduced by £4.6 billion, about one-third of the budget in real terms. There is a limit, which we are fast approaching, to how long this can go on.

While all this is happening, vulnerable people are missing out. The reduction in spending has resulted in eligibility thresholds being tightened so that often only the most severe needs are met through state-funded social care. In total, around 400,000 fewer people have their assessed needs met. If they reach crisis point, they will have no choice but to turn to the NHS for support. Then they are more likely to stay in hospital for longer because it is too risky to transfer them home without the support of social care services. A social worker I know said to me recently that the problem is that social care funded by the state is used mostly by poor people who do not have a voice, and Governments therefore feel that they can get away with not doing anything. That is the impression that the Government’s failure to act has given to people out there.

I wish to raise another issue relating to the quality in the sector. I agree with all noble Lords who talked about the importance of quality, especially most recently the noble Baroness, Lady Dean. It is about the new arrangements for funding student nurses. I understand that in order to remove the cap on student nurse places—and, by the way, remove the debt from the Government’s books—the Government plan to remove their bursaries and fees and offer student loans instead. We certainly need more student nurse training places since there are already four applicants for every place. However, any expectation that hospitals would pay off the debt of newly qualified nurses who would go to work for them is unrealistic in the extreme. I am told that while there is going to be some scope for NHS provider organisations to reimburse staff for their training, it will be completely at the discretion of that organisation. The group of HR directors that I heard from said that it would happen very infrequently, due to cost. This does not mean that the occasional exceptional candidate may not be reimbursed, but, without funding through the NHS tariff to cover staff training, it would represent an exceptional cost. The expectation is therefore that private healthcare providers and care home operators would not reimburse either, but, again, could do so at their own volition.

Given that the margins in social care provision are so tight, I am concerned that those nurses who would like to work in that sector will have a problem. I cannot see any care home providers being able to offer this pay-off, yet those who provide specialist nursing services really need well-qualified nurses to supervise them or they will not be safe. It is a matter of maintaining quality. What does the Minister suggest is done about this? Following the spending review, there are so many additional costs that will already have to be met by providers of all kinds that I would be very surprised if any of them were able to reimburse a nurse’s training costs. These vital professionals cannot expect to be highly paid when they qualify, so where does the Minister think they will get the money for, in effect, an additional 9% on their income tax after qualification? This is short-sighted and will do nothing to increase the number of UK nurses, especially in the lower-paid social care service, where I anticipate the highest impact of this change. If you add all this to the announcement in the spending review that care homes, along with other providers, will have to pay the full cost of their mandatory CQC inspections, you have a system that is ready to implode.

What steps are the Government taking to ensure that the proposed 2% levy per year on council tax in the form of a social care precept will deliver the money required to ensure the right levels of social care and do so equitably? The authorities that need the most additional money have the least ability to raise it through taxes. When will self-funders get some certainty enabling them to plan for their old age? I echo my noble friend Lady Brinton in asking where the £6 billion saved from the failure to introduce all the Dilnot reforms has been distributed. It certainly has not gone into the social care budget. I am just as curious as the noble Lord, Lord Warner, to find out where this amazing disappearing £6 billion has gone. How will the Government ensure that newly qualified nurses will not be deterred from entering service in the social care sector?

Finally, I am very puzzled about one thing and I wonder if the Minister can help me. All the acute hospitals are in deficit and somehow the Government manage to bail them out. I wonder why that is when they are not prepared to bail out the social care sector. Perhaps it is because they have already spent the money and, of course, next year some of the extra money already announced for the NHS will have to go towards next year’s projected deficit as well. Perhaps it is because local authorities and private and voluntary care providers cannot spend money that they have not got and therefore it cannot be refunded. However, it occurs to me that if the Government were prepared to spend that couple of billion pounds every year doing something about social care then maybe we would not have such a big deficit in the NHS at all.