Health and Social Care Budgets

Paul Blomfield Excerpts

Tuesday 14th March 2017 Westminster Hall

[Mr Clive Betts (Sheffield South East) (Lab)]

It is a pleasure to follow the two Select Committee Chairs, my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) and the hon. Member for Totnes (Dr Wollaston); we have worked very closely on these issues. It is also a great pleasure to see so many other colleagues in the Chamber today. It is obvious that social care and health issues are now coming very high up the agenda, which is absolutely right.

I will refer to the report that the Communities and Local Government Committee has just produced, “Adult social care: a pre-Budget report”. In the next few weeks, we will produce a longer report about longer-term issues in social care. To begin in the here and now, the Committee welcomed the fact that the Government have allowed local authorities to increase the precept in the next two years and have encouraged local authorities to take up that offer, while still recognising that there are challenges around the fact that the precept raises very different amounts of money in different local authority areas. We asked for an immediate further injection of £1.5 billion, so it is welcome that the Chancellor announced an increase of £1 billion, even though £1.5 billion would have been more welcome—I think that is how the Committee will look at that.

Recognising that that would not be a permanent solution for this Parliament, however, we asked for the National Audit Office to be given the responsibility to look at what is required for the rest of this Parliament—the further two years of the spending rounds—to address the issues in social care. Those issues are very real, with an increase by a third in the number of people in their 80s or 90s over a 10-year period, with local authority spending on social care down by 7% since 2010 in real terms, with the increase in the minimum wage, with the Care Act 2014 and with all these other pressures.

[Paul Blomfield (Sheffield Central) (Lab)]

Does my hon. Friend recognise that there are two groups of victims of the crisis in social care? They are not only those who depend on the services, but those who work in the sector and who face, for example, widespread non-compliance with national minimum wage legislation, which the Government are aware of but not acting on. Does he agree that needs to be recognised in a future settlement? We need a paradigm shift in how we view care work.

[Mr Betts]

We will return to the proper training, long-term commitment and pay of staff in the care sector in our Committee’s further report, but we certainly had evidence to that effect.

We need another way of dealing with the funding gap for the rest of this Parliament. For the longer term, I very much welcome the announcement of the Green Paper, but I echo the comments of the two previous speakers. We need to get cross-party agreement on a sustainable, long-term settlement that will last not merely for the next Parliament, but for several Parliaments after that. There are major challenges. I agree that we should look at health and social care together, but there are fundamental differences in governance and accountability between the two systems, so how do we resolve that?

We should certainly look closely at what is happening in Manchester, to learn about the devolution deal there and how the two can work together within the same governance structure. Personally, I feel that losing the local accountability that the social care system currently has and simply centralising the whole system would be a mistake. That would take us in the wrong direction, so it is important to look at what is happening in Manchester. We have two very different funding systems. We have the health system, which is free at the point of use, but I do not think that anyone suggested in evidence that we could fund social care on exactly the same basis. We will have to consider something slightly different to fund social care, but how the two systems fit together will be a challenge.

If we are considering the future for social care funding, we should bear in mind that currently we have a mixture of funding. We have some central Government funding, local authority funding and the personal contributions that come through people paying for their care, particularly in residential homes, and what happens to their estate when they die. Will that mean a bit extra from those different elements—a bit more from central Government, local Government and personal contributions—so that the total whole grows? However, the Government have said that they will introduce the Dilnot proposals in the next Parliament—that is what the Minister said to us—which will cap and reduce the contributions that may come in from people’s private estates when they die, so does that mean more money from somewhere else?

I am sorry that the Chancellor did this, because everything should be on the table, but he ruled out a different way of taxing or receiving contributions from people’s personal estates when they die: taking a percentage of everyone’s estate. Currently, people contribute their estate if they end up with dementia and go into a care home, but if they have a heart attack, they tend to contribute nothing. Is that system fair? Is that a challenge we must look at? Even with Dilnot, the £72,000 limit would take most of the estate from a small house sold when someone in my constituency dies, but it would be only a fraction of the value of a property sold in the more expensive parts of London. Is that fair either? Do we simply scrap the whole thing and go on to a German system of social insurance?

The Communities and Local Government Committee went to Germany to have a look at its model. There are pros and cons to it, but we really need to put everything on the table and not rule out any possibilities. We need something that we can, in the end, reach cross-party agreement on, recognising that the social care system will probably be different in its funding from the health system. How they can fit together and be governed together will be absolutely crucial to the success of a long-term settlement, when we eventually reach one.