That the Grand Committee takes note of the Report from the Economic Affairs Committee Social care funding: time to end a national scandal (7th Report, Session 2017-19, HL Paper 392).
My Lords, I am pleased to introduce the Economic Affairs Committee’s report, Social Care Funding: Time to End a National Scandal.
We published our report in July 2019, and yet, 18 months later, we still await the Government’s response. The Government are accountable directly to Parliament. They have a duty and a responsibility to reply to committee reports in a timely way, usually within two months. Some 18 months ago, we said:
“With each delay the level of unmet need in the system increases, the pressure on unpaid carers grows stronger, the supply of care providers diminishes and the strain on the care workforce continues.”
Just 20 days after our report was published, the Prime Minister stood on the steps of Downing Street and said
“we will fix the crisis in social care once and for all with a clear plan we have prepared to give every older person the dignity and security they deserve.”
Now, more than ever, urgent government action is required.
Before I explain our conclusions, I would like to thank the committee staff who produced the report: Sam Newhouse, Luke Hussey, Michael Berry, Ben McNamee and Lucy Molloy. Especial thanks go to our special adviser Professor Richard Humphries, whose support was invaluable. I also thank my noble friend Lord Tugendhat, the noble Baroness, Lady Bowles, and the noble Lord, Lord Burns, who leave the committee today under our rotation rules. All of them have made a huge contribution to our deliberations and participated in no fewer than nine inquiries.
I must begin by praising our care workers. They have been on the front line of the pandemic. They have put their own health and safety to one side to care for and protect the most vulnerable among us. Care workers have performed an immeasurable service for our country but clapping alone will not help put in place the major reform that the sector so desperately needs.
In May 2020, I wrote to the Chancellor to press the case that this report deserves renewed attention now that the needs of the sector, and the heroic service and sacrifice of its workforce, have come to the fore of the nation’s priorities. In response, the Chancellor said:
“The Government’s number one priority for adult social care is for everyone who relies on care to get the care they need throughout the COVID-19 pandemic.”
In July 2020, I exchanged letters with the Minister of State for Care in which she assured me that the Government were due to meet shortly to discuss our report and any further reflections on reform. Finally, in October 2020, the Minister, my noble friend Lord Bethell, said that the pandemic had delayed the Government’s work on designing a sustainable social care funding model—words, words, words and broken promises.
My Lords, I am delighted that we have at last got this debate, and I share the frustration of the noble Lord, Lord Forsyth, at the time it has taken. He has been an indefatigable leader and chairman of the Economic Affairs Committee in the time that I have served on it, and I am most grateful to him and my colleagues on it for all the work and energy that have gone into not only this report but others, where we have tried to be practical and helpful and to make achievable suggestions for policy change.
I am also grateful for the passion with which the noble Lord, Lord Forsyth, has dealt with this and spoken about it today. My passion is somewhat dimmed by defeat, in a way, because it feels as if this is something that I have been banging on about for ages and we are still not really getting anywhere—but I am sure that everyone in the sector feels the same.
I will focus particularly on the plight of the care workers because that is my background and area of interest. The noble Lord, Lord Forsyth, has mentioned them, but it is worth going into some of the privations that they suffer in a little more depth. They are under- valued, underpaid and definitely undertrained; they do not have the status of nurses or even of childminders. The sector is subject to very weak regulation: we just do not know who they are or what qualifications they hold, and they are not registered with any professional body. The workforce of 1.8 million people in England is almost invisible—that is, until you need them, when they become very important.
The low status and poor treatment of care workers have led to a really vicious downward spiral in one of the most difficult sectors for workers, with a huge amount of exploitation. It is not just that they are badly paid; most of them earn less than the minimum wage, if you take into account the fact that many of them do not get paid for working in between clients. They are not paid for the journeys that they make and are often subject to very exploitative zero-hours contracts, which destabilise their lives and make it extremely difficult for them to do their work properly.
My Lords, social care funding for older people or those with a disability has been put in the “too difficult” or “too expensive” box for as long as I have been involved in health and care policy—about 20 years. At every general election since 2010, there has been a promise to fix it, and, sure enough, after the 2019 general election, as we have heard, Prime Minister Johnson joined his predecessors and promised to address the issue “once and for all”.
State provision of social care is not easy, it can be expensive and there is no right way to do it. The German and Japanese models are often quoted; they involve members of the public contributing to an insurance system that will pay for their care once they need it.
England has no state provision of social care. We have a system whereby the person’s needs are addressed and, after a means test, they will find if they are eligible for financial support from their local authority. This will go some way towards the provision of their social care, either in their own home or in a residential setting, but not accommodation costs.
Local authorities pay out at different rates. I sat on the joint scrutiny committee for the Care Bill 2014. We heard of families moving to a neighbouring county to ensure that they were eligible for a more generous provision. Sometimes there is a need to top up from savings or by selling or remortgaging the family home. Some with long-term care needs might, for many years, face care costs that seem reasonable at the outset but will quickly erode savings. So the proposed cap is welcome.
The proposal to introduce free personal care over the next five years should be adopted. This would require an immediate investment of £8 billion—the estimate from the King’s Fund and the Health Foundation.
The other part of the care system is for those adults with disabilities; the majority—1.5 million—have a learning disability. Until last year I was chair of a charity which cared for over 2,000 adults with a learning disability. With help, such people can lead a fulfilling life. Many are in residential care or supported living. The funding from this comes from local authorities, which hold the responsibility for their care. Each year the conversations with commissioners become more difficult, as local authorities’ budgets are stretched and the costs of caring rise.
My Lords, I declare that I chair the National Mental Capacity Forum and am a Bevan Commissioner. This commendable report provides a way forward, recommending that there must be an appropriate national funding formula. That formula must be fair, recognising that areas of high costs are often in areas of less business buoyancy, meaning that the desire to make local authorities more fiscally self-reliant risks widening gaps in provision and worsening the postcode lottery.
The report was prophetic. The pandemic has shown that social care cannot be used as a pressure valve for the NHS. It has also revealed to the nation, as the report points out, that social care sector staff providing direct care are underpaid and undervalued and that their personal well-being has often been overlooked.
Personalised care has two distinct roles. One is providing all the personalised care underpinning and integrated with healthcare interventions, often delivered by health and social care staff working together. Any division based on budgets creates an artificial split, with expensive bureaucratic processes if a person’s care moves from one sector to another, either geographically or by diagnostic category.
The other role of personal social care is to support people—often working-age adults—in their own homes, to allow them to live well and contribute in our society. A key part of this role is in the prevention of healthcare problems arising. Yet this prevention role has been chronically undervalued, even though it saves avoidable expenditure from the health budget. The future of public health in social care needs much greater emphasis.
During the pandemic, some charities have instigated innovative programmes to deliver social care and support, several seeing great results in improving mobility and independence. But current funding difficulties for charities have revealed our overreliance on this sector over years.
3:06 pm
The Lord Bishop of Carlisle [V]
My Lords, I add my own expression of gratitude to the Economic Affairs Committee for such a clear and coherent report, based as it is on such careful research and presenting us with such direct and forthright conclusions. Its basic principles for reform are eminently sensible. Like others, I applaud the emphasis, pace Dilnot, on a partnership approach to the funding of social care, and the principles of free personal care, with a cap on accommodation costs, and increased funding enabled by general taxation. I will focus my brief contribution on principle (j), which reads:
“Invest in the social care workforce and ensure a more joined up approach to workforce planning with the National Health Service.”
If that is ignored, any increase in funding will run the risk of being wasted.
We are all well aware of the current situation in this country. The number of older people and working-age adults requiring care is increasing rapidly. Some 1.4 million people over 65 have unmet care needs. Covid has reminded us of just how crucial care homes and carers are in our society, alongside NHS workers and social services. Yet, as the noble Baronesses, Lady Kingsmill and Lady Finlay, have pointed out, carers are usually undervalued; they refer to themselves as second-class citizens; they are underpaid, underqualified and under- resourced, with a chronic staffing shortage that is getting steadily worse.
There are too many adjectives there beginning “under”. It is no wonder that there is a turnover rate of nearly a third in such an underregarded profession, with poor levels of both retention and recruitment. As we have already been reminded, what is so obviously needed for carers is a combination of proper status, good and appropriate training, and reasonable pay. The report before us has significant implications for all of those, as pages 24 to 29 make clear.
With regard to status, if the social care workforce of 1.6 million is to be developed and stabilised, there needs to be more parity of esteem with their 1.4 million NHS colleagues. That necessitates a programme of vocational as well as academic training, which will provide social care staff with the qualifications and career structure that are currently lacking.
In its turn, that should prompt levels of pay, especially in publicly funded institutions, that begin to reflect the value to society of the service being offered. None of this can happen without a substantial increase in funding, which is why the report is so important. That is before even considering the possibility of support for the 5 million or so unpaid carers who do such a great job and save us vast sums of money every year.
My Lords, this is an excellent report and its stark conclusions are as relevant today as when it was first published. Social care is severely underfunded, with the most deprived areas being the worst hit. More than a million adults who need social care are not receiving it and the system is riddled with unfairness. We are in a vicious cycle. After decades of reviews and failed reforms, the level of unmet need rises, the pressure on unpaid carers grows, the supply of care providers diminishes and the strain on the undervalued care workforce ever increases.
The core recommendation of £8 billion to be spent immediately to restore quality and access to adult social care has been widely supported. So, too, has the recommendation to introduce free personal care, such as help with washing, dressing or cooking, to be funded through general taxation over a period of five years, at a cost of £7 billion per year. The committee argues that this is simple, fair and not much more expensive than other proposals for reform. But, given the history of many reviews, we should not underestimate the barriers to its adoption, and I would like to mention five of those barriers.
First, adult social care has never commanded the priority that it deserves. The way that care homes have been dealt with over the pandemic is of course illustrative of this, with a lack of priority given to them in relation to PPE, testing and the movement of infected patients from hospitals to care homes.
Secondly, those in care homes would still pay for their accommodation and assistance with less critical needs like housework or shopping, so it is not the whole deal.
Thirdly, I am by no means certain that the costs of even limited free social care have been fully quantified. The experience of the NHS at its beginnings is instructive. Nye Bevan had assumed that, after a few years, the costs of the NHS would come down as the NHS caught up with the backlog of patients who had been unable to afford treatment before. That proved to be a trifle optimistic.
My Lords, this report was published in 2019 and I share the frustration of the noble Lord, Lord Forsyth, about the delay in debating it, which I must say is indicative of the treatment of social care by successive Governments.
The history is stark. As long ago as 1999, a royal commission proposed more generous means testing for residential care and free personal nursing care. Nothing happened in England, although I think that free care was introduced in Scotland. In 2011, the Dilnot commission proposed a cap on lifetime care and a more generous means test. The coalition Government legislated to implement these proposals, but the Conservative Government in 2015 postponed their introduction and, in 2017, this postponement became permanent. As Jeremy Hunt said earlier this week:
“It was the silent cut that people didn’t notice until too late”.
In 2017, the Conservative Government promised a Green Paper, but nothing happened, perhaps because of fears about the so-called dementia tax in that election campaign. The 2019 Conservative manifesto promised urgently to seek cross-party consensus on this issue—nothing has happened.
Urgent action, as all noble Lords have indicated, is now required. In 2018, 14% of older people were reported to have unmet care needs. This situation will clearly have deteriorated as a result of the pandemic. To make things worse, we know that, as we speak, there are over 100,000 unfilled vacancies for workers in residential homes—a possible side effect of Brexit—and we also know that finance, as the report says, is forcing care homes to prioritise people who are self-funding over local authority provision.
I therefore endorse the call in the report for cross-party consensus on social care and the demand for a White Paper now to set out the options for funding. I agree with the conclusion in the report that additional funding for adult social care should be provided as a government grant, paid directly to local authorities and funded from general taxation, and that personal care at home should be free. The current postcode lottery in domestic care provision is manifestly unfair. Is there any wonder that local authorities cannot cope, bearing in mind the cuts imposed by central government since 2010? I also agree that there should be a cap on residential care, as Dilnot recommended and as is suggested by the report.
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Let me be clear. It is quite wrong to suggest that the Government could not have, and cannot, bring forward a plan for social care reform because of the pandemic. The opposite is the case, and I hope my noble friend will not repeat this calumny when he reads out his departmental speech this afternoon. The pandemic has revealed the centrality of social care and the need for no more dithering, no more Green Papers, no more delays; major reform must take place now.
We held a private meeting with care workers, and the stories we heard were truly humbling. We heard of frustration at being described as “just a carer” and that the sector is no longer seen as attractive. We heard from burnt-out workers, who cannot afford to run a car, forced to take multiple train journeys to get to work, working 14- to 15-hour days with take-home pay less than can be obtained for stacking shelves in a supermarket. Social care workers deserve better than this. They should be rewarded and treated as a highly skilled and caring profession. We concluded that career structures, training and the establishment of a professional structure were urgently needed.
Social care is a job-rich sector at a time when, sadly, unemployment is soaring as a consequence of the Covid-19 pandemic. The Resolution Foundation said that it would take an extra 180,000 care workers just to bring the ratio of carers to the over-70s population back to its 2014 peak. That is 180,000 just to get back to where we were in 2014. In our most recent report, on employment and Covid-19, we repeated that the Government should expand the number of care workers by increasing funding to the sector, with stipulations that it should be used to raise wages and improve training and conditions. It is time to turn our hands from applause to actions which give our social care workers the deal they deserve.
We have had enough of excuses for procrastination such as “The Government cannot bring forward plans for reform without cross-party consensus.” Everyone knows there is a consensus in Parliament and the country that we need to commit the resources that are desperately needed to support our most vulnerable citizens, young and old.
In May 2020, when our committee held its annual session with the Chancellor, we pressed him on the problems faced by the care sector. He said that the absence of a consensus over funding is a significant barrier to reform, along with its expense. That translates from Treasury speak to “I don’t want to spend the money.”
Since then, the Government have continued to kick the can down the road. More speeches have been given accepting the need for reform, yet cross-party talks have been delayed, and the proposals the Government have promised have been pushed back again. There was consensus in our cross-party report on a fully costed, long-term solution. The duty now falls upon the Government to bring forward a plan that reflects the cross-party consensus that does exist.
We drew attention to dwindling access to local authority funding, and the increasing pressures that result in the rationing of care to people who are in desperate need. Recent figures from the IFS show that between 2009-10 and 2017-18, per-person spending on social care for the over-65s fell by 31%. Significant investment is needed to buck that trend. We examined various options for how funding social care can be made sustainable. Having done so, we recommended that social care be funded largely from general taxation.
A central theme of our inquiry was the question of fairness. Our report identified three ways in which the present system is unfair: disparities between adult social care and the NHS, between those who fund their own care and those who receive local authority funding, and between different local authorities.
On the first of these, the UK has an ageing population, and many people have complex and difficult social care needs which they must fund themselves. The disparity with the NHS, which is free at the point of use, is striking. Why should support be free for cancer patients but not those suffering from motor neurone disease, for example?
Dementia was cited by several witnesses as an example of this disparity. The costs of caring for dementia can be long-lasting and, in some cases, catastrophic. The Alzheimer’s Society told us that the typical dementia care costs are £100,000, rising to £500,000 in some cases.
Secondly, care homes charge self-funders more in order to make up the inadequate amounts paid by local authorities. The Competition and Markets Authority estimated that self-funders paid 41% higher fees than the local authority rate. Witnesses said this amounted to a cross-subsidy that is unsustainable. We concluded that there is a real danger of a two-tier market emerging, in which care homes are driven to market to self-funders, reducing the availability of places for individuals sponsored by local authorities.
Thirdly, local authorities differ in respect of the cost pressures they face and their ability to raise funds. The result is that a postcode lottery has emerged. These disparities are growing with every day of government inaction. Reports suggest that the Government have been looking at private insurance as a way forward. I am grateful to the Association of British Insurers for the briefing that it sent to colleagues for this debate and which reflects the committee’s conclusions. No country relies primarily on private insurance to fund adult social care costs. It cannot provide the amount of funding required by the social care system, not least because roughly half of public social care funding is spent on people who are of working age; it is not just about the elderly.
Instead, we concluded that social care must be brought closer to the NHS by introducing free personal care. Personal care is about funding the basic activities of daily living: help with washing, bathing, dressing, mobility, eating and drinking. It does not include other, more expansive, activities, such as assistance with housework or shopping. Those in care homes would still pay for their accommodation and assistance with less critical needs. Those receiving care in their own homes would not have to pay accommodation costs, which may encourage care users to seek essential help with personal care early.
As the ABI says in its brief, a universal offer from the state would provide a clearer foundation on which people can plan and make their own provision where they need to top up. If personal care was free, individuals would likely be expected to top up their hotel costs with private funding. An insurance or asset-based top-up market could grow to support this. We concluded that the costs of care should be shared between individuals and the taxpayer. We were told that basic entitlement to publicly funded personal care would cost around £7 billion, if introduced in 2020-21.
We concluded that the Government should adopt a staged approach to providing the additional funding. We said that they should immediately invest in adult social care to restore quality and access to 2009-10 levels, estimated now to cost £10 billion. They should then introduce free personal care over the next five years.
In July 2018, the then Prime Minister announced that NHS funding would be increased by £34 billion over the next five years. This amounted to a spending increase in real terms of £20.5 billion. That increase alone is almost as much as the total spending on social care. It is time Cinderella was taken to the ball.
I have been a Conservative for nearly 50 years. I served in local government for five years, in both Houses of Parliament for 36 years and as a Minister for more than a decade. Of course, during that time, I have supported policies that I was uncomfortable with and promoted others that I regret, but I have never felt the sense of shame that I feel today at our failure to act on the funding of social care and to tackle, in the words of the title of our report, “a national scandal”. I beg to move.
The workforce tends to be older women or migrant workers, which may very well account for the fact that they are not given much priority within the health and care service generally. They are overlooked and, as I say, we do not really know who they are. Turnover among care workers is enormous—between 30% and 40%—because they are badly paid; sometimes the supermarket down the road is offering a pound an hour more, and they have to go. They are often the main wage earner in their family, and they have to go where they can earn the most money, so there is a terrible, very rapid, turnover.
In the context of the Covid crisis that we are suffering, care workers are seven times more likely than the rest of the population to become infected with it. There is a huge amount of absenteeism at the moment because of illness or isolation, and there is a vast unmet need for care workers at the moment.
The other issue that is important when we talk about care workers is the fact that they have no career opportunities. Attracting people into the profession is very difficult: there is no progression and it is seen as unskilled work, which it most certainly is not because, so often, they need to have the skills to deal with complex feeding methods, using hoists for moving patients, dressing wounds and administering medication, as well as providing vital domestic and emotional support for the care recipients. They have to do all of this in 15-minute slots, if they are a domiciliary worker—
As the noble Baroness, Lady Kingsmill, said, care workers are paid poorly, and should be receiving the real living wage of £9.50 per hour but many do not. Those who work in the care of either older people or those with a learning or physical disability are not unionised, as nurses are. They are not regulated; nor are they required to have formal qualifications, but many would take the care certificate. Someone who has been fired for negligence or worse can walk out and get a job straightaway. This should change.
Whichever way you look at it, the current system is no longer fit for purpose. There is a sustainable solution. The report of the Select Committee of the noble Lord, Lord Forsyth, offers a route map for the department. Mencap estimates that £3.2 billion would stabilise the system. So, when they have a moment, the Prime Minister, the Chancellor of the Exchequer and the Secretary of State for Health and Social Care should read this report, and do what successive Governments have promised to do: fix the funding of the care system. This would be welcomed by so many older people and their children.
The report highlights the workforce—without a workforce any structure will fail and there will certainly be no resilience. Will the Government urgently look again at a proper career structure with parity of esteem and of pay for those in social care? Percentage pay increases simply widen the gap between the lowest paid, who do the work with the most vulnerable, and others. Staff need their travel time between homes recognised and to be able to park on arrival. They need ongoing training and supervision, with support for their own well-being—if they feel cared for, they are better able to care for others. Those receiving social care are potentially very vulnerable, which is why a proper registration and revalidation process of social care staff would set a national standard and could provide a focus—to nurture staff, helping them feel pride in their work and more respected. Their work is highly skilled and low paid, and their indemnity needs sorting out across the sector in the long term as part of an integrated system.
Form must follow function in a fair national funding formula that recognises our duty to each other in society. In this way, we might be able to move forward. To not heed this report will worsen our problems.
However, it involves more than just financial commitment, crucial though that is. This report, like so many before it, is about a change of culture, which is why the greater integration of health and social care to which it refers is so vital. We have a renamed department, but the transformation that that implies must go beyond its title. When asked recently about his biggest hope for change, Sir Simon Stevens replied:
“Seeing health and social care as two sides of the same coin.”
The Select Committee on the Long-term Sustainability of the NHS has exactly the same aspiration.
It has already been observed that, despite many positive and encouraging statements over the years, there has so far been a huge political reluctance to grasp this particular nettle, despite the cross-party consensus mentioned by the noble Lord, Lord Forsyth. I appreciate that much time and attention is currently focused elsewhere, but we would be grateful to know from the Minister whether Her Majesty’s Government have any timetable in mind for the sort of reform of our social care system that, as this report makes clear, is so urgently needed.
Scotland’s experience is relevant. The King’s Fund and Health Foundation 2018 report A Fork in the Road warned that the introduction of free personal care in Scotland had
“created unexpected levels of increased demand for domiciliary care which we might also expect to occur in England.”
They estimated that, with free personal care, the number of people receiving publicly funded domiciliary care in England would almost double. My concern is that free personal care would be underfunded and long waiting lists would be the result.
The fourth issue is that, in arguing for a mainly publicly funded solution, the committee’s hope for a market for private care insurance would be likely to develop in a system where personal care costs are funded by the state. This was the hope of Sir Andrew Dilnot who argued in his report, which the Government accepted, legislated for but never implemented, that limiting the risk for insurers by a cap on individual costs could help to provide a sustainable market for private social care insurance. The insurance market was unenthusiastic and I would like to hear more from the chair of the committee about how the committee thinks a more positive response would come from these proposals.
Fifthly, the committee says that cross-party co-operation will be necessary if progress is to be made on reforms to social care funding. I wish the committee well on this. Ever since Andrew Lansley’s description of Andy Burnham’s proposals in 2010 as a “death tax”, cross-party consensus has looked an ever distant dream, though I accept that it is desirable.
None the less, and despite the evident challenges, this is surely a good basis on which the Government can build their long-anticipated Green Paper.
But we should also not forget the position of unpaid carers, without whose help the whole system would collapse. It is estimated that there are 9 million unpaid carers in this country, many of whom have been badly affected by Covid, as Mencap demonstrated this week. The report emphasises the importance of not allowing the body of impartial carers to diminish. Is it too much to ask the Government to increase the carer’s allowance of £67 per week by a further £20 per week, as Sir Edward Davey has called for?