Local Government and Social Care Funding

Norman Lamb Excerpts

Wednesday 24th April 2019 Commons Chamber

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

I associate myself with the comments of the other two Front Benchers about the events over the weekend. I had the honour of being in Jerusalem for Easter and was shocked on Thursday and then on Sunday to hear of such horrific events. I was sitting in a site that is so precious to the three monotheistic faiths when I heard that, after the terrorist attack in New Zealand, we had had violence in Northern Ireland and then the horrific attacks in Sri Lanka.

Turning to this afternoon’s debate, I echo the comments of the hon. Member for Denton and Reddish (Andrew Gwynne). Here we are yet again. The Green Paper that we should be debating to consider sustainable funding for social care has been kicked into the long grass five times, and there is no sign of it coming forward. Is that just because the House, the Government and the civil servants are too busy with Brexit, or is there really a lack of ideas on how to solve the situation? The problem, however, is that we should urgently be thinking about a way forward.

The NHS five year forward view was based on game-changing public health changes and funding and increased social care funding and provision, because otherwise all we will see is increased demand at the front door of the NHS and then a blockage and leakage of funds at the back end. The four-hour target that we often talk about does not just measure A&E performance; it is about the flow of patients through the system. If patients cannot get home at the other end, the system simply breaks down.

Local government in England has seen an average 28% cut in funding, and I have been shocked by some of the figures that Members have mentioned, which range from 46% to 75% to 97% cuts in central funding. Obviously, everyone has faced cuts to their budgets, but there has been only a 5% reduction in local government funding in Scotland despite a 7% cut in the resource budget. The situation has been much more protected than has been the case in England. In Wales, there has been an 11% cut.

I welcome the long-term NHS plan because it unpicks some of the damage done by the Health and Social Care Act 2012, particularly by reforming section 75, and it tries to drive integration, which I think Members on both sides of the House would recognise is the only way forward. However, it was disappointing to discover yesterday on the Health and Social Care Committee that local government was not involved, almost at all, in putting together the long-term plan, yet it will be expected to deliver more and stronger social care to relieve pressure on the NHS.

[Norman Lamb (North Norfolk) (LD)]

Does the hon. Lady agree that it should have been a long-term health and social care plan if we actually believe in joined-up, integrated working and that the funding settlement for the NHS, very tight as it is, simply will not work without addressing the underfunding of social care?

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[James Cartlidge (South Suffolk) (Con)]

It is a pleasure to follow the right hon. Member for Exeter (Mr Bradshaw). He spoke about a blueprint; I have read that report and I remain unconvinced that it absolutely nails down who would pay and how much, which is of course the toughest part of these decisions. None the less, it is a very good proposal and I respect that.

Like the Labour Front-Bench spokesman, the hon. Member for Denton and Reddish (Andrew Gwynne), the right hon. Gentleman referred to cuts in local government funding since 2010. I hate to labour the point—it is a political point—but we cannot avoid asking ourselves why those cuts were necessary. The motion mentions sustainability, as does the Independent Group’s amendment, or what we might call the TIG amendment. But the cause of our problem was unsustainability in the public finances and the economy, with a huge growth in all kinds of borrowing, including private borrowing, mortgage borrowing and public borrowing prior to the crash, and public spending commitments based on unsustainable tax income from, for example, city bonuses. That was never going to be sustained. It was always going to end in a big crash, and—guess what?—it would always fall to us to step in and fix the problem.

Labour MPs may deny that. I asked the hon. Member for Denton and Reddish whether Labour’s 2010 manifesto protected local government. As he did not answer, let me remind the House what the manifesto said:

“Labour believes we should protect frontline spending on childcare, schools, the NHS and policing, and reform our public services to put people in control.”

Note the absence of local government funding. It goes on to say—this is the key line:

“We recognise that investing more in priority areas will mean cutting back in others.”

In other words, if an area of spending was not protected, it would get a right old shellacking, which is what happened under us. We did the same thing. We had priority Departments that we protected, but at a time when the deficit is very high, if we protect some Departments—which is perfectly justified, as we did with the NHS—others will take a disproportionate hit. That would have happened under Labour. I honestly do not say that for the purpose of political point scoring. It is to underline the reality that there is no parallel universe where there would not have been a significant hit to the grant given from central Government to local authorities after 2010.

[Norman Lamb]

To go back to trying to find solutions to the problem that we face, the hon. Gentleman mentioned the joint Select Committee report. Does he agree that we need a new funding stream, as the Select Committees suggest, and that the best way to achieve a sustainable solution is to work cross-party, as the Select Committees did, to come up with a solution? Even if they do not have all the detail yet, that is clearly the right way to achieve a sustainable settlement.

[James Cartlidge]

That is a good point, and I will come to that. I make what is essentially a political point about Labour’s manifesto because we have to get into our heads the idea that there will never again be a time when local authorities do not have to make difficult decisions and look for efficiencies and innovation. The idea that there will always be a cavalry that can come over the hill and, with the wave of a magic wand, summon up central Government funding—which, by the way, does not grow on trees, but also has to come from taxpayers—is wrong.

Colleagues are right to mention good examples of best practice and innovation. In my constituency, I have two district councils and two wards of West Suffolk. West Suffolk is a newly merged council of St Edmundsbury Borough Council and Forest Heath District Council, and savings have been made through that process. Babergh district is entirely contained within South Suffolk. It is not a merged district council. There was a referendum on whether Babergh should merge with Mid Suffolk. Babergh voted to remain independent from Mid Suffolk, but they merged their back offices, and there have been huge efforts to achieve savings and efficiencies. Babergh has left its head office in Hadleigh in my constituency and is now based in Ipswich, outside the district, which has been unpopular but has saved money. It has set up a joint venture to renovate and restore its old headquarters and make them a commercial asset. The point is that those sorts of changes by district councils will always be required.

Suffolk County Council has seen huge innovation in relation to social care, as my hon. Friend the Member for Bury St Edmunds (Jo Churchill), who is on the Front Bench but cannot speak in the debate, will know. Councillor Beccy Hopfensperger has done great work as the cabinet member for social care in Suffolk. Through the use of technology, the council is saving money, driving down costs and improving care. For example, sensory apps are being used, so that families can know whether their loved one who is able to stay at home is moving around and mobile—in short, that he or she is well. Such technological innovations can help to reduce the cost of care and deliver better care.

On the broader question that the right hon. Member for North Norfolk (Norman Lamb) raised about the sustainable funding of social care, I feel passionately about this issue. The biggest issue in British politics begins with b, and it is not Brexit by a long chalk; it is Beveridge. The welfare settlement we have in this country covers the whole of the state pension, the NHS, social care and every aspect of the contract that we all thought we had entered into, but the system is not remotely sustainable. If we look at the Office for Budget Responsibility’s forecasts for just NHS spending 50 years from now, we see that it estimates we will be spending the same again in real terms as we do on the NHS now because of changing technology, demand and so on, so we have a huge challenge ahead of us.

On the specific point about paying for social care, I recently had a constituency surgery at which an elderly lady came to see me because her husband has a very difficult condition and she wanted to know what support was available to her. She felt she was in that category of my constituents who are neither so poor that they receive lots of help nor wealthy enough to be able to afford to fund a good lifestyle. I asked her, “What about your house? Do you have housing assets?” She said, “Yes. We have a house worth about £700,000, with no mortgage.” However, in her eyes, she has no money.

This issue of housing and assets is always going to be the most controversial point, as we discovered to our cost at the last general election. The residential housing assets of those aged over 65 is worth between £1 trillion and £1.4 trillion, depending on which estimate we look at, and that is a staggering sum. We have to accept that at the core of this issue—and this is the reason why it is so controversial—those entering the workplace today will not have occupational pensions and will not build up such a level of housing equity. That is highly unlikely because, in my view, we will not see such a period of high house price inflation again; it is not sustainable. We are reaching a point where those paying into the system are seriously questioning whether they will get the same benefit as those who retire today.

This intergenerational issue is no one’s fault; no one designed it that way. In fact, the welfare system I have mentioned, the Beveridge system, was built with the very best of intentions for a post-war country. However, the thing we need—and I will conclude with this key point—is honesty. That was said by my hon. Friend the Member for Lewes (Maria Caulfield), who is a nurse, and I greatly respect the expertise she brings to this issue. In this populist, Trumpian era, the one thing that will make this work is all of us being open and transparent about the tough choices we are going to have to make. No one is going to have a free option. There is no free option: every option available is going to cost.

I happen to think that the best option will involve some use of housing equity, perhaps with a choice for people to pay through an alternative method if they do not want to bind themselves into that. In relation to those entering the working population, I think we should look at the success of auto-enrolment. How many people here have had emails from constituents complaining about the rise in pension contributions from their salary from auto-enrolment? I have not had a single email because people believe it is a contribution from which they will benefit. It is not like the old, pay-as-you-go system, and I think we could link the social contributions of the young generation through a premium to such a system, as the Select Committees have suggested.

It will be very difficult to come up with a solution for social care. It may take consensus, or it may take a future Government with a large majority being pretty tough and disciplined. It will take one or the other, not what we have at the moment. However, we can make a start, and we have to be open and transparent about the fact that there is no easy option, but there can be an option through which we get much better care for the next generation.

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[Norman Lamb]

I share the hon. Lady’s view of the excellent Select Committee on which we both serve. We had a fascinating visit. Does she agree that, from what we heard this morning, there is a case not only for increasing investment in dementia research based on transforming the lives of people who currently suffer with dementia, but for investing to save? If we are to prevent the health and care system from bankrupting itself because of this increasing prevalence, we have to act now to reduce that prevalence by finding out how we can prevent dementia in future.

[Vicky Ford]

I absolutely agree. We heard it described earlier as like watching a tsunami way out to sea. People are living longer, which means that the number of people suffering from dementia around the world will increase unless we get ahead of the challenge. We cannot just keep watching it; we need to get ahead of the challenge to understand the causes. There will be cures, but only if the world continues to invest in the research. As well as investing in social care and finding a new model to help to provide it, let us keep up our world-leading research into Alzheimer’s and other dementia-causing diseases and make sure that the UK continues to lead on that challenge, and let the Government invest more and get the rest of the world to do so, too.

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[Norman Lamb (North Norfolk) (LD)]

I will address most of my remarks to the issue of social care and the challenge we face, but first I want to highlight a real concern that other hon. Members have also expressed. The funding constraints on local government have had a very big impact on preventive services that are designed to stop extra costs being incurred at a later stage through a failure of the system.

I will give one or two examples. The Select Committee on Science and Technology recently conducted an inquiry into the impact of adversity in childhood, looking in particular at trauma, abuse or neglect in early years. We know that if we intervene early and follow the evidence of what is effective in stopping trauma becoming entrenched, we can not only transform lives but save a fortune further down the track.

The hon. Member for Sleaford and North Hykeham (Dr Johnson) said something about the Conservative party being the custodians of careful finance, but we are seeing significant reductions in investment in preventive services, which end up costing the state a fortune further down the line. Too often, children who experience trauma, abuse or neglect in early years and who do not get the support they need end up being excluded from school, and the track through to the criminal justice system is all too real. Educational attainment is, therefore, often lower than it should be, and worklessness often follows. The disinvestment over the past few years in those preventive early years services, supporting parents and so on, has been a very stupid thing to do, because it will cost the state far more in years to come.

When the Chancellor launched the Budget a few weeks ago, it was encouraging to hear him say that he was willing to invest in early intervention where there was evidence of its effectiveness. Well, there is evidence of its effectiveness, so the Chancellor needs to make that investment.

[Toby Perkins]

I have huge respect for the right hon. Gentleman’s knowledge in this area, but he is talking about overall local government spending cuts and he was, of course, a part of the first five years of this Government. The greatest austerity and local government cuts were made under a Liberal Democrat and Tory coalition, so does he regret his part in the huge cuts made to local government between 2010 and 2015?

[Norman Lamb]

If we are honest, every Government have some responsibility. The reductions started before 2010. I absolutely accept—[Interruption.] Let me address this point; I am trying to be straight with the hon. Gentleman. I think mistakes were made by the coalition Government in terms of the hit local government took during that period. The contrast between the support for the NHS by increasing investment in real terms and the cut to social care does not make sense, but that is what happened. I recognise that. It was above my pay grade, but I do not think it was the right decision to make. I hope that that is of some help to the hon. Gentleman.

[Dr Sarah Wollaston (Totnes) (Change UK)]

My right hon. Friend makes some really important points about the first 1,000 days of life, but equally there are similar arguments relating to the end of life. For example, too many people who need social care end up in a much more expensive place at the end of their life—in a hospital setting, where they do not want to be—for the want of the right investment in social care. Does he agree that we should apply the principle of investing to save across the whole of life?

[Norman Lamb]

I absolutely recognise and accept that point.

The hon. Member for Chesterfield (Toby Perkins) intervened to challenge the point about spending under the coalition Government. There was a crisis in public finances in 2010 which did have to be addressed, but I do accept that the balance between social care and the NHS was not optimal. I also want to address other areas where the underinvestment or disinvestment in preventive services has borne a heavy cost.

The hon. Member for Lewisham, Deptford (Vicky Foxcroft), who has done very good work on youth violence—I have been part of the commission looking at that—made the point that many of the preventive services that are there, particularly during teenage years, to stop the risk of young people slipping into gang violence have been stripped away in many of the poorest communities. Again, the impact of that has, at least in part—it is very hard to judge cause and effect—been an increase in violence on our streets at the awful and dreadful cost to many of those affected by it.

I want to turn specifically to social care. It is worth reflecting on why social care is so important. It is there to give people the chance of a happy life and a good life, as far as they are able to enjoy that if they are struggling with a range of conditions. It is there to help people to remain independent in old age, to support people so that they do not end up needing the NHS, with an enormous impact on their wellbeing. One of the problems we face is that unless you or a family member experiences the need for social care, it is hidden from view. Very many families across our country simply do not see the impact of the underfunding of social care today, but it is very real. There are over 1 million older people who are not getting the care they need. As Simon Stevens, the chief executive of the NHS, has pointed out on many occasions, if people do not get social care support, that has an impact on the NHS. The funding settlement for the NHS simply will not work unless we address the under-resourcing of social care.

[Dr David Drew (Stroud) (Lab/Co-op)]

The right hon. Gentleman knows more about social care than anyone else in this House—I pay him that compliment. Does he accept that one of the most unfair issues is where local authorities have moved people with learning disabilities out to cheaper parts of the country—Gloucestershire being a classic case—and their care needs get worse over time? The local authority that moved them out says, “It’s not our problem; it is the problem of the local authority to which they have moved”. Does he agree that that is why we need a national care service?

[Norman Lamb]

The hon. Gentleman is absolutely right to highlight the issue of how we care for people of a younger age who have care needs, particularly those with learning disabilities and autism. What happens too often is that those people end up in institutions when they do not need to be there, often away from home and at enormous cost to the public purse. Again, the evidence from around the country shows that where this is done well and where families are supported to keep someone at home, helping them through crises, we not only reduce the cost to the public purse but have a massive impact on their wellbeing. He is also right to highlight the fact that we end up with awful disputes about who is responsible for payment as people are shunted around the country in a way that, in my view, fundamentally breaches their human rights.

[Barbara Keeley]

I am glad that the right hon. Gentleman is talking about this topic. It is absolutely vital, but does he regret the extent to which the Government now seem to have abandoned the transforming care programme? There seems to be no future for it. From the time when he was a Minister, there was a programme to deal with the issue that my hon. Friend the Member for Stroud (Dr Drew) raised, but there now appears to be an abandonment of targets and an abandonment of the future of that programme, and certainly no funding to make it work.

[Norman Lamb]

I am deeply concerned about the future—or lack of a future—of the transforming care programme. One of the problems is that it is often NHS England that is funding care in an institution, and when a local authority is under financial stress, there is not much of an incentive to take that person out of the institution and make them the responsibility of the local authority. There has to be a way of funding the building of infrastructure to support people in the community. That is what has failed to happen so far.

This is not a static issue that we face. There is growing pressure. We are all living longer, often with chronic conditions that in the past used to kill us. That is a great triumph of man and womankind, but there is a cost attached, yet we have no mechanism to address the increasing funding needs of social care and, in particular, dementia.

The hon. Member for Chelmsford (Vicky Ford), one of the valued members of the Science and Technology Committee, made the point that the cost to society of dementia is about £26 billion every year, but that is going to rise dramatically. Whatever we say about spending money efficiently—I completely agree about the need to spend money efficiently and to innovate and do things in a more effective way—the dramatic rise in demand inevitably means that we will have to spend more as a society on supporting people with dementia and on research to find cures for dementia.

[Tom Brake]

Will my right hon. Friend give way?

[Norman Lamb]

I will briefly, but I am having glowers directed at me by you, Mr Deputy Speaker.

[Tom Brake]

Does my right hon. Friend agree that one of the ways of supporting people who need care, such as dementia sufferers, is to support their carers, and that there is a very important role for organisations such as the Sutton Carers Centre in providing support to the network of carers who support people with dementia and others with long-term conditions?

[Norman Lamb]

I very much agree, and those organisations do incredibly important work.

I want to mention the Care Act 2014, which I was responsible for taking through Parliament. I think it was widely regarded as good legislation, but I fear that it has been undermined by a failure to commit sufficient resources to really realise the transformation that it was designed to achieve in personalising care and putting the individual at the heart of everything that local authorities do. In particular, we legislated for a cap on care costs in that Act, but as soon as the Conservatives got rid of the Lib Dems from the coalition, that commitment was abandoned. All the work that we did in consulting and legislating for a cap on care costs to protect people from catastrophic cost has been lost. Of course, we know that in the 2017 general election the Prime Minister paid dearly for that politically, because the replacement proposal was sorely lacking and amounted, in many people’s eyes, to a tax on dementia.

I am conscious that you want me to shut up very soon, Mr Deputy Speaker, but I want to say something very briefly on future funding. It seems to me that if we are to achieve a sustainable settlement, we have to work on a cross-party basis and the Government have to embrace that. The motion still prompts the question of where the money is going to come from—it does not answer that question.

There are a range of solutions. My party and I have proposed a dedicated health and care tax that would appear on people’s pay packets so that everyone could see where the money was going, and which would be informed by an independent assessment, perhaps every five years, of how much the health and care system needed. It would take the politics out of the calculation of how much the care system needs. Then the parties could argue about whether they were prepared to meet those needs through an increase in that dedicated tax.

If we are to solve this, it will require political will. There has been a failure of the political class, not just in the last few years but ever since the late ’90s, when a royal commission established by the then Labour Government came up with proposals that were never implemented. It has been kicked in and out of the long grass ever since, and we are still waiting for a solution. It is time we found one, because we are letting down too many people in our country.

[Several hon. Members rose—]

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[Caroline Dinenage]

I want to make some progress, because a number of Members have made a lot of points and I want to try to cover them, but I will come back to those who want to ask questions.

My hon. Friend the Member for Lewes (Maria Caulfield) said, in the words of Bananarama, that “it’s not what you do, it’s the way that you do it”. She highlighted the innovative moves by her local council in East Sussex to look into delayed transfers of care and stepdown beds. She rightly paid tribute to the hard work of the NHS and local authority staff who do so much to stop people being trapped in hospital beds, which we know is no good for them in the long term.

My hon. Friend the Member for South Suffolk (James Cartlidge) reminded us of the parlous financial situation that we inherited in 2010, and of all the difficult decisions that have had to be made across different councils and central Government as a result. He also gave some great examples of local councils that have achieved efficiencies through innovation, technology and sensible decisions, and spoke of the need for much more honesty and transparency as we try to find a solution to the problem of adult social care.

The hon. Member for St Helens South and Whiston (Ms Rimmer) made a thoughtful and measured speech, focusing mainly on adult social care. She spoke a lot about the workforce issue, about which I myself am particularly passionate. In February we launched an adult social care recruitment campaign called Every Day is Different. The aim is to raise the profile of the sector, and to encourage people with the right values to apply to work in this incredibly important role. The Department of Health and Social Care also funds the Skills for Care campaign to help the sector with recruitment, retention and workforce development. That includes the distribution of £12 million a year for a workforce development fund. Providers can bid for a share of the fund to help their staff to train and gain qualifications at all levels.

My hon. Friend the Member for Redditch (Rachel Maclean) spoke passionately about carers, who have already been described as the unsung heroes of our health and care system. My hon. Friend and neighbour the Member for Fareham (Suella Braverman) made a number of points, but, in particular, raised problems in relation to continuing care. NHS England has launched an improvement programme to help clinical commissioning groups to address variations in the assessment and granting of eligibility.

The hon. Member for Hartlepool (Mike Hill) made a thoughtful and heartfelt contribution. He talked specifically about the challenges facing coastal communities. I empathised with that, as I represent a coastal community myself. He said that Hartlepool was a vibrant and welcoming place. He is a great ambassador for his constituency—as, indeed, is my hon. Friend the Member for Chelmsford (Vicky Ford), who tells us all that her own constituency is the No. 1 place to live in the UK, and also the No. 1 hotspot for night life. I am not sure how she knows that! She spoke about the lottery of long-term care. We will seek to address the catastrophic way in which care costs can affect some individuals in the Green Paper, when it comes forward.

[Norman Lamb]

The Minister has just mentioned the Green Paper. I realise that she cannot say when it will be published, but do the Government intend it to lead to reform in the current Parliament when it is published, or are we likely to have to wait until some time in the middle of the next decade before any reform actually happens?