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12.12.16

Ministers considering council tax precept rise to save adult social care

The government is considering plans to allow councils to increase council tax precepts in order to relieve the social care crisis, it is understood.

Local councils have suffered more than a 40% reduction in government grants since 2010, leading experts to warn that the social care system could “topple over at any moment”. That would put immense pressure on the NHS as patients would take longer to be transferred from hospital.

There has been criticism, such as by Lib Dem health spokesperson Norman Lamb MP, that the plans would worsen the postcode lottery for residents with wealthier areas set to benefit more than poorer ones.

However, senior government sources have denied the reports and said the council tax precept will remain unchanged.

Martin Green from Care England, which represents social care providers, told the BBC that social care funding is reaching a crisis point, telling Radio 4’s Today programme that “40% of care services will no longer be viable in the medium term, so this is a huge number of care services that will be lost”.

“Some companies will definitely go bankrupt,” he added. “In the majority of local authority areas they raised the precept, but there is no clear audit trail to say has all that money reached the front line.”

The former chancellor George Osborne previously introduced a precept allowing councils to charge up to 2% of additional council tax, which is ring-fenced specifically for social care.

However, councillors have warned that even if every local authority imposed the maximum 2% levy, as almost all of them are planning to do, social care would still have a funding gap of at least £2.6bn by 2020, leading them to divert money from other vital services.

Three quarters of authorities said that the 2% precept would be insufficient to close their funding gap in the LGiU's State of Local Goverment Finance survey released back in February. 

The LGA said that the £383m raised from a previous 2% precept was eclipsed by larger costs, such as increasing the National Living Wage. Cllr Izzi Seccombe also told the Times that increasing the social care precept would not be enough to plug funding gaps, with a £1.3bn injection needed immediately instead.

Cllr Claire Kober, chair of the LGA’s resources board, added in a statement: “Services supporting the elderly and disabled are at breaking point. It cannot be left to council taxpayers alone to try and fix them.

“Only genuinely new additional government funding for social care will give councils any chance of protecting the services caring for our elderly and disabled.”

Andrea Sutcliffe, the chief inspector for adult social care, told the Times that the sector has got “increased demand and potentially a restriction on capacity”, adding:  “Unless we really get to grips with some of these problems... we will get to an absolute crisis.”

The Care Quality Commission previously warned that adult social care is reaching a ‘tipping point’ in its annual State of Care report back in October.

(Image c. CQC)

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Comments

Christine Melsom   13/12/2016 at 13:13

The iniquitous 2% levy for adult social care added to your council tax bills. This will continue until 2020 - not sure if this is compounded but if it is it equates to a whole lot more. Many councils are suggesting that a further two per cent is needed as the last lot just covered the award of the living wage to local government employees, which rises again next year. Adult social services are something that most of us will use in the years to come. It should therefore be financed through central Government income tax or perhaps a health levy? collected in the same way. This 2% levy has reminded us that under the current system a household with perhaps three, four or even more resident adults pays no more in council tax than that with two, with the result that it could be said that many are not contributing. Is that fair? No it is not. Of course no Government likes to raise income tax but believe me the council tax payer has been the butt of huge rises during its time: it is now essential that everyone paying tax should pay their share

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