National Audit Office: Reforming adult social care in England

Two years into its ten-year plan to overhaul adult social care, government has delayed its plans to cap lifetime care costs that a person pays and scaled back plans for reforming the system it set out in December 2021 and, despite progress in some areas, is behind schedule even on its revised plans.  

More than a billion pounds of the £1.7 billion committed to reforming the adult social care system in December 2021 has been diverted to other care priorities, according to a new National Audit Office (NAO) report. 

Reforming adult social care in England reveals that only £729 million may now be spent between 2022 and 2025 on reforming the adult social care system, representing a 58% fall in the budget.¹ 

Rising inflation has compounded long-standing pressures in adult social care and, coupled with concerns about the sector’s contribution to delays to hospital discharge, has led the Department for Health and Social Care (DHSC) to reprioritise its reform funding and activity in favour of helping to stabilise the sector.  

At last year’s Autumn Statement, government postponed its £3.6 billion charging reform initiative and committed up to £7.5 billion to the sector, including £2.7 billion of new central government funding, to help ease immediate pressures. These measures provided some welcome relief for local authorities. 

DHSC estimates that in 2023-24, local authorities, in aggregate, intend to spend enough on adult social care to cover cost pressures. However, there is local variation and funding may not be reaching areas that need it most because government has not updated the formula used to distribute most local government funding for adult social care since 2013-14. DHSC estimates that around a quarter of local authorities may not spend enough to keep up with the cost pressures they face this year, while one in six expects demand for adult social care to exceed capacity this winter. ² 

Despite some recent signs of improvement, the care system remains under significant pressure. Among the many challenges are concerningly high waiting lists, which local authorities reported had increased by 37 per cent between November 2021 and April 2022.³ While they have eased slightly since then, survey data suggested that the number of people waiting more than six months in March 2023 for a care assessment was almost double – at around 82,000 – what it was at the end of 2021. 

Vacancies in adult social care in England have increased by 173 per cent in the past decade and, despite a recent fall, stand at around 152,000 (a 10 per cent vacancy rate). Around 70,000 staff have been recruited from outside the UK in the past year.⁴ 

The NAO report finds that DHSC has much to do if it is to achieve its 10-year ambition for reforming adult social care and must manage significant risks. However, DHSC has not established an overarching programme to coordinate its reforms, making it difficult to know if it is on track to achieve its objectives.  

DHSC is delivering on two of its eight workforce projects – supporting international recruitment and adult social care volunteering – the remaining six are in development.  Some projects within digital, data and assurance have made better progress.  

The NAO found that DHSC does not have a long-term funded plan for transforming adult social care. The department’s Next steps paper, published in April 2023 which contained high-level plans for system reform – does not go beyond the current spending review period. 

Delivering charging reform by October 2025, will require significant work by both DHSC and local authorities which will need to begin soon to remain on track. The NAO heard that work on preparing local authorities would need to have started by summer 2023. 

The NAO recommends that DHSC assesses the impact of its current and planned reform interventions on local authorities and seeks stakeholder views to ensure its plans are manageable. It should also set out a costed plan for implementing charging reform from October 2025, and map the funding required to deliver its planned reform outcomes.  

Gareth Davies, the head of the NAO, said: 

“Adult social care reform has been an intractable political challenge for decades. Government has set out its ambition to meet this challenge and now needs to demonstrate how it is delivering on these plans. 

“If government is to successfully reform adult social care, it will need to manage some significant risks, including its own capacity and that of local government to resume charging reform activity alongside system reform.  

“To maximise its chances of succeeding, government will need to ensure it understands the impact of its ambitions on local authorities and other stakeholders and establish a costed plan which ensures delivery of its long-term goals.” 

ENDS 

Notes for Editors 

1.     As at September 2023, of the £1.74 billion agreed with HM Treasury for system reform when it published its white paper in December 2021, DHSC now intends to spend £729 million on system reform between 2022-23 and 2024-25; a fall of 58%. Compared to the £1.74bn funding agreed, DHSC has reallocated a total of £1.01bn to other social care priorities. This is made up of £570 million to MSIF Workforce Fund (for between 2023-24 and 2024-25), £172 million to the Adult Social Care Discharge Fund (in 2022-23); £40 million to the Local Authority Urgent and Emergency Care Fund (for 2023-24); £37 million for charging reform implementation (in 2022-23 or for 2024-25) and £20 million towards the NHS pay award (2022-23). It forfeited £171 million of funding to HM Treasury as a result of delaying charging reform because thousands of people who would have got local authority support to help pay for their care will remain eligible for certain DWP benefits.   

2.     DHSC does not formally estimate cost pressures by local authority, and whether they plan to meet them. However, DHSC analysis found that if national cost pressures were assigned to local authorities in line with the adult social care relative needs formula, around one quarter did not plan to increase spend enough to meet indicative cost pressures. Local authorities forecast that demand for long-term care this winter will be 93% of available capacity, but 24 local authorities (one in six) expect demand will exceed capacity in their areas. 

3.     Between November 2021 and April 2022 the number of people in England waiting for a care assessment, care and support, direct payments or reviews, increased from 395,845 to 542,000, when it peaked. It then fell to 434,243 by March 2023. The number of people waiting for more that six months for a care assessment (only) in March 2023 was 82,087. 

4.     Between 2012-13 and 2021-22, the total number of vacancies in adult social care in England increased by 173% from 60,000 to 164,000. In the year to 2022-23, it fell 7% to 152,000 (a vacancy rate of 9.9%), supported by the recruitment of 70,000 staff from overseas.