Question to the Department of Health and Social Care:

To ask Her Majesty’s Government what plans they have to ensure provision of social care for non self-pay service users in the event of systemic failure in the social care market.

It is important that there is a vibrant market of local care and support providers offering a choice of high quality services that are able to adapt over time to meet changing needs.

The Care Act introduces new duties on local authorities to promote their local market, with a particular focus on quality, diversity and sustainability. The Government recognises that local authorities’ own commissioning is likely to be their most important tool for facilitating their markets. The Government has worked with the Local Government Association and the Association of Directors of Adult Social Services (ADASS) to co-produce material to help local authorities promote their local markets and improve their own commissioning.

Ultimately, local authorities remain locally accountable for how their budgets are allocated, including spend on care and support. However, the Care Act is clear that prices agreed with care providers will have to reflect the new duties outlined above in relation to the promotion of sustainability of the overall market. The Government recently published statutory guidance setting out how local authorities should meet these new duties when commissioning, including the consideration of the actual costs of care and support when negotiating fee levels. A copy of the guidance is attached.

More widely, as in any market, provider exits and entries are inevitable. Where continuity of care is at risk because a provider’s business has failed, local authorities must temporarily step in to ensure an individual’s needs continue to be met, including the needs of both those that are self- and state-funded. In order to help local authorities respond to potential situations where a provider is particularly large or geographically concentrated, and where an individual local authority may struggle to carry out this duty on its own, the Government has created a new market oversight function which will be carried out by the Care Quality Commission (CQC). The CQC will act to oversee the finance of specified providers with a view to providing local authorities with early warning of financial failure and to ensure effective contingency plans can be put in place.

The Government has also commissioned the ADASS to publish guidance for local authorities to assist them in developing contingency plans for managing provider failure which should be available by summer 2015.