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26.02.15

Changes to Better Care Fund nearly caused councils to quit the scheme

Councils nearly walked away from the Better Care Fund when it was redesigned last year with a bigger bias towards the NHS.

The revelation has been made in a report from the Commons Public Accounts Committee examining the preparations for the implementation of the flagship reform.

The Fund was paused and redesigned following the appointment of Simon Stevens as NHS England chief executive last year. Committee chair Margaret Hodge said the initial planning for the scheme was “deeply flawed”.

“Whilst NHS England and the Department of Health worked on a planning assumption that the Fund would secure £1bn in financial savings for the NHS, the Department for Communities and Local Government had not worked on the basis of a required savings target,” she said.

“The failure to be clear with local areas about the expected savings severely undermined the initial planning process. When local plans were stress tested, savings of just £55m were identified – nowhere near £1bn.”

Since the Fund was altered, as much as £1bn pooled from the NHS and councils will be allocated against a local target for reducing the number of unplanned hospital admissions by at least 3.5%. If this target is not met, the balance will be used to support NHS-commissioned services, as agreed by the health and wellbeing boards.

This alteration was made following concerns that hospitals may lose out from the scheme, and apparent discontent with the whole Fund from NHS trust directors – but the MPs said the changes moved the financial risk onto councils.

“The Local Government Association considered that the redesigned scheme moved the integration agenda backwards and not forwards, and it told us that local government had contemplated walking away from the Fund. Local areas are now at greater risk of not being able to implement the policy,” Hodge said.

She added that with the redesign of the Fund, “the priority has shifted from improving local services through integration to protecting NHS resources”.

“It appears to the Committee that NHS spending was judged a higher priority than supporting adult social care.”

As a result of the redesign, all 151 health and wellbeing boards had to submit revised plans, which the PAC said resulted in “wasted time, effort and money”. The latest plans suggest that local areas expect to pool £5.3bn and save £532m in 2015-16.

However the committee is sceptical of the expected savings target.

Hodge said: “We are not convinced that it is possible to reduce emergency admissions and to deliver £532m of savings in 2015–16, as the scale of the challenge in reversing the long-term upward trends in emergency admissions and delayed discharges is significant.”

The Local Government Association said the report correctly highlighted the pressure put on councils by the government changes, adding that protection for social care funding needs to be “urgently addressed in a similar way as it has been for the NHS”.

A spokesman added: "The failure to set out the £1bn savings target to councils along with ministers' decisions to move the goal posts to respond to financial concerns raised by the NHS has made carrying out these plans more difficult and left many councils with very little time to implement the changes before the April 2015 deadline.

"While it was clear from the outset that the Better Care Fund was not bringing in new money for health and social care, the fundamental problem started when the £3.8bn pool was placed in the spending power for both the NHS and local government, making the process competitive rather than collaborative.

"Local government is still committed to the principles of health and social care integration, but it must be a shared ambition."

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