Council Funding and Social Care

Melanie Onn Excerpts

Wednesday 22nd February 2017 Westminster Hall

[Alan Johnson (Kingston upon Hull West and Hessle) (Lab)]

It is a great pleasure to conduct this debate under your excellent chairmanship, Mr Bailey, particularly as I hear you are going to Hull on Monday with the Industry and Parliament Trust, which is a great organisation. It shows that you are a man of discernment and great taste, and you will have a good time in the city of culture—and I would not dare to ingratiate myself with you at the start of the debate!

Adult social care in England presents the biggest domestic political challenge of our time, and that includes how to fund it, how to ensure it is more closely integrated with health and how to ensure that the system is sustainable in an ageing society where demand is bound to continue to rise. In the past week alone, while Parliament has been in recess, Age UK has said that the system is moving from crisis to collapse. A report by Oxford University and the London School of Hygiene and Tropical Medicine concluded that problems in adult social care are behind an unprecedented increase in mortality. If we look at the statistics we see that mortality has gone up, but the normal infant mortality measure is not the cause, nor is the mortality rate of babies born after 28 weeks, which is a big factor. However, the adult mortality rate has gone up by 5.7%, and the report says that is due to problems in adult social care in England.

The debate today is about one strand of the enormous challenge, and it is very much focused on the short term: how local authorities will be able to maintain, let alone improve, services over the next few years. In relation to the debate about the long term, I was Health Secretary 10 years ago, and I was heavily engaged in the internal debate within the Brown Government about the need to devise a completely new and substantial stream of funding for adult social care. My right hon. Friend the Member for Leigh (Andy Burnham) became Health Secretary after me. He managed to reach a consensus with the Conservatives and the Liberal Democrats that was disgracefully scuppered by Andrew Lansley during the 2010 general election campaign. That attempt to find new money was disparagingly referred to by the then Conservative Opposition as a “death tax”, complete with pictures of tombstones on their election posters. It may have helped them to dislodge Labour, but it did not help them to solve the problem.

The Dilnot inquiry subsequently made a number of suggestions, including the eminently reasonable one that people like me who are working beyond state pension age should pay national insurance. That was quickly dubbed the “granny tax”. Between the death tax and the granny tax, the national debate on how we find the means to tackle this crisis has rarely managed to rise above the glib and the facile.

I applaud the recent cross-party attempt to convince the Prime Minister of the need to find a new cross-party consensus. Perhaps the Chancellor is even now working on the final details of a great and imaginative scheme that can attract all-party support for a national solution to a huge and growing problem. His autumn statement was an enormous disappointment. While he may mistakenly believe that the biggest crisis he faces is how to defuse the considerable row over business rates, he needs to understand that the interlinked issue of adult social care—interlinked for reasons I will come on to— overshadows everything in his in-tray and in the Cabinet’s in-tray.

It is traditional in debates of this kind for somebody to say that the problems are not all about money. I have no doubt that the Minister is preparing himself to fulfil that role in this debate, but I am afraid that in respect of adult social care, it actually is all about money. According to the Institute for Fiscal Studies, direct funding to local authorities will have fallen by 80% by 2020. I repeat: 80%. Adult social care is not ring-fenced. Some £4.6 billion was slashed from those budgets in the last Parliament, with the result that we spend less on social care now than we did in 2010. Those are House of Commons Library figures obtained yesterday. It is less in cash terms, which is even less in real terms, and all parties agree that the problem is mainly caused by underfunding.

In written evidence submitted to the adult social care inquiry last year, the King’s Fund said that

“the fundamental cause of the problems in adult social care is inadequate funding.”

We can talk about innovative ideas and methods that councils across the country are employing, including my council in Hull—they are doing brilliant things to try to deal with some of the wider issues—but the basic fundamental problem comes down to cash and funding. Indeed, the scale of the problem is such that in evidence to the same inquiry, the chief executive of NHS England, Simon Stevens, said that were any extra money to become available from anywhere it should go not to the NHS—his own organisation, which he was representing—but to social care. That was a remarkable and unprecedented act of self-denial in respect of access to public funds.

Pending the Budget and the outcome of further deliberations by the Government on the issue, the solution that this Administration have pursued with the most vigour is simply to pass the buck to local authorities. Let us for the sake of this debate accept the premise that local authorities are best placed to deal with the issue and that the adult social care precept may be the new funding stream that has proved so elusive. Even if we accept all that, the first point that the Government must surely acknowledge is that the amount raised does not begin to match the scale of the problem. The precept in 2016-17 raised £382 million, which is less than 3% of council spending on adult social care. However, it would have been a very welcome 3% increase, were it not for the fact that implementation of the national living wage cost those same councils an estimated £612 million, wiping out the additional money and leaving councils with a deficit on this issue alone of £230 million.

[Melanie Onn (Great Grimsby) (Lab)]

There are some 850,000 people living with dementia in the UK, and their care is usually more expensive than standard elderly care. We have seen £160 million taken out of adult social care budgets between 2010 and 2016. When it comes to the adult social care precept at the local authority level, does my right hon. Friend agree that it is destined to create a postcode lottery and impact further on the services that people expect to receive in times of great difficulty?

[Alan Johnson]

My hon. Friend is absolutely right about that, and I will talk about the widening inequalities in a second. She was also right to refer to dementia sufferers. Too often in this debate—I am perhaps guilty of this, as well—we deal with dry statistics, percentages and precepts, when at the end of it there are people who are very vulnerable and need care, above all dementia sufferers. We have to tackle that and ensure that the inequality gap does not get wider. I will come on to that in a second.