A fair settlement for high quality disability provision: voluntary organisations disability group’s representation to hm treasury on the comprehensive spending review

Key messages

• People are using care services at a time of unprecedented demographic change and financial austerity. Fewer and fewer disabled people are eligible for services and unmet need is on the rise. High quality care must be funded to enable disabled people to have their needs met.Key messages

• The continued squeeze on fees has led to social care markets, worth over £20 billion per year, being fragmented and unstable. Without adequate funding voluntary organisations will exit the market causing further market instability.

• Government needs to be alert to the fact that the social care market could collapse. Markets require good management, and as part of this the costs of procurement and regulation need to be controlled and kept low. Central to this are the fees that are paid to providers, which must be set at a level that will enable people using services to have their needs met through the provision of high quality services.

• Should social care markets fail, the lives of millions of people who use services will be negatively affected. There will also be a direct impact on the NHS as demand increases for emergency and hospital services.

• We urge government to ensure that social care funding is protected including making provision for the gap in social care funding by 2020, alongside the £8 billion gap in health service funding over the same period.

• The recommendations of the Barker Commission[1] provide long-lasting solutions to the challenges in integrating health and social care budgets. These recommendations should be implemented.

• A sustainable funding settlement for the sector will enable disability organisations to invest in their people – to further build careers in the sector, to recruit and retain the right staff and to pay the workforce at a rate that recognises the value of the work they do in society. The national minimum wage and national living wage must be properly funded.

INTRODUCTION

MEETING NEED FOR THE GROWING NUMBERS OF DISABLED PEOPLE USING CARE AND SUPPORT SERVICES

• Support will be required for an additional 6,000 to 46,000 young adults with physical disabilities over ten years. This equates to a ten-year growth rate of between 32% and 239%.
• Between 37,000 and 52,000 adults with learning disabilities will require support over the next ten-year period, resulting in a growth rate of 26% to 37%.

• Physically disabled and people with learning disabilities using residential and home care – £53 million.
• Older people supported through home care or in residential care – £67 million.
• People using mental health services – £14 million[10].

Key messages

A FAIR CONTRACT – SUSTAINABLE FUNDING, MANAGED MARKETS AND EFFECTIVE REGULATION

• Demand and supply should be roughly in equilibrium. Delayed transfer of care is an indicator of a weakening of community services – a trend that has remained critically unresolved, and rising, over recent years[22]. The proportion of delays attributable to social care increased over the last year to 31.4% in June 2015, compared to 24.7% in June 2014[23]. The main reasons for the delay was people waiting for community provision in order to leave hospital – those very community services which have been cut due to reductions in local authority funding[24].
• Price would be at a level to deliver the quality purchasers demand and to secure future investment. But 56% of directors of adult social services report that providers are facing financial difficulties[25], and sector leaders have warned of an exit of providers.
• Consumers would have good access to information, and providers would be readily able to respond to consumer demand. People who use services do not always have the right information, at the right time to make informed decisions. One quarter of people who use social care services report not having access to the right information and advice about their services[26]. For people who use care services one quarter feel they do not have control over their daily lives[27].
• Regulatory or legislative change would be planned well in advance with ample warning to the supply side of the market. Whilst the CQC has made some improvements in its operating model, the National Audit Office find the regulator still has a long way to go to demonstrate its cost effectiveness[28]. This financial year, for example, the CQC raised its fees to providers by 9% from 1 April despite widespread opposition to the proposals (80% of sector respondents)[29]. The regulator needs to be made fit for purpose with a lean operating model focused on clear outcomes.
• Market entry and exit would occur but it would take place in an orderly fashion without consumers being disadvantaged. Whilst the Care Act should enable providers to deliver transformational care and support, concerns remain over commissioning practices. For example commissioning that lacks strategic vision and is unilaterally driven by price, and not quality.

Key messages

INTEGRATED CARE – THIRD SECTOR DISABILITY ORGANISATIONS ARE AN INTEGRAL PART OF THE SOLUTION

• England needs to move to a single, ring-fenced budget for health and social care, with a single commissioner.
• There should be more equal support for equal need. Over time the ambition should be:
  • First, those whose needs are currently defined as ‘critical’ should receive free social care, ending the current distinction between free NHS Continuing Healthcare and means-tested social care at the highest level of need.
  • Second, that as the economy improves, free social care should be extended to those with ‘substantial’ needs.
  • Third, that some support should be extended to people with moderate needs by 2025, with the expectation that they would be expected to contribute to those costs subject to a means test,
• The government should plan on the assumption that public spending on health and social care will reach between 11 per cent and 12 per cent of GDP by 2025.

Key messages

RIGHT PEOPLE, RIGHT VALUES – INVESTING IN THE WORKFORCE

• In 2016/17 20 organisations will be required to spend an additional £6.2 million on the pay bill. By 2020/21 the figure rises to £58.3 million.
• The percentage increases in hourly rate required to manage the impact varies considerably. The average percentage increase expected in 2016/17 was 2.5%. This rises to 14.4% by 2020/21.
• Pay differential within the sector will be negatively affected. 11 organisations will not be able to maintain their current pay differential. 7 organisations reported that they will seek to uplift pay grades above the NLW.
• There are significant ‘knock on’ effects on overall business costs when outsourced services (e.g. cleaning) are taken into account. 14 organisations reported the knock on effects of the NLW to be highly significant or significant.
• Should predicted fee increases identified to implement the NLW not materialize the following issues were reported:
  • Debt covenants could become a problem for some providers. 6 organisations reported debt covenant problems were likely given the current proposals on the NLW.
  • 14 organisations reported that reductions in service development would be very likely or likely.
  • 15 organisations reported that reductions in workforce development would be very likely or likely.
• A reasonable threat to the viability of the organisation was reported as very likely or likely by 12 organisations.

• The national minimum wage working time directive[44] represents a significant human resource issue for disability care providers. 89% of staff in our sample of 36 VODG organisations take part in sleep in arrangements, typically lasting nine hours long.
• Arrangements in paying for sleep in shifts are very mixed and there is a lack of clarity amongst providers. We estimate that the cost for all VODG members implementing NMW during sleep in shifts would be £27.3m.
• A need for a fair contract between commissioners and providers. Only four providers received fees from commissioners that cover the costs of paying the NMW for every hour of a sleep in shift. 88% of providers do not receive sufficient fees and the average shortfall is £3.25 per hour. Overall providers report the attitudes of commissioners to be largely unsupportive (84%). Only one provider reports all commissioners being supportive on paying fees sufficient to cover the costs of sleep in arrangements.

Key messages