This approach of ‘crisis-cash-repeat’ is ineffective and represents poor value for money. Emergency funding in the winter of 2022/23 offers a good example of its shortcomings. First, government funding was announced and then disbursed late. The Adult Social Care Discharge Fund, worth £500m, was announced in September 2022, already well into the period when the NHS, local authorities and social care providers would have been planning their winter capacity. The £250m of emergency winter pressures funding was not announced until 9 January 2023 – far into the worst of the crisis. ¹ Department of Health and Social Care, ‘Oral statement to parliament: New discharge funding and NHS winter pressures’, GOV.UK, 9 January 2023, www.gov.uk/government/speeches/oral-statement-on-new-discharge-funding-and-nhs-winter-pressures Even after announcing the Adult Social Care Discharge Fund in September, it took the government until December to disburse the first tranche – 40% of the total – to councils and the NHS, with the remaining 60% leaving central government coffers in January 2023. ² Humphries R, ‘Hospital discharge funding: why the frosty reception to new money?’, blog, The Health Foundation, 13 January 2023, retrieved 17 October 2023, www.health.org.uk/news-and-comment/blogs/hospital-discharge-funding-why-the-frosty-reception-to-new-money

Second, the funding came with burdensome reporting requirements. The government required local authorities to detail how they planned to spend all their funding four weeks after it announced allocations. Thereafter, local authorities were expected to provide fortnightly activity reports, with a final report due in May 2023. ³ Department of Health and Social Care, ‘Adult social care discharge fund. Annex B: grant conditions’, 16 March 2023, retrieved 17 October 2023, www.gov.uk/government/publications/adult-social-care-discharge-fund/annex-b-grant-conditions For already under-resourced councils, this represented extra work with little obvious benefit to them. 

Third, it is unclear whether the money has even been effective in its stated goal. The funding allocated in 2022/23 was intended to reduce the number of people in hospital who did not need to be there. But evidence that it was effective is mixed. On one hand, in the last week of February 2023, there were on average 13,720 people in hospital per day who were eligible for discharge, compared to 13,545 in the last week of November 2022 – an increase of 1.3%. On the other in the same period in 2021/22, delayed discharges increased by approximately 13%, and in the absence of funding, the level would likely have been higher in 2022/23. However, there is also evidence that while delayed discharge was largely flat in acute hospitals throughout the winter of 2022/23 (as shown in Figure 3.2), that may have been achieved at least in part by shifting people to other parts of the health and care system. Research by Nuffield Trust shows that there was an increase in the number of people delayed in community beds throughout the winter of 2022/23. There were approximately 5,300 people delayed in that setting at the start of November 2022, rising to just over 6,000 in March 2023 – an increase of roughly 13%. ⁴ Dodsworth E, ‘Growing numbers of delayed discharges from community hospitals’, blog, Nuffield Trust, 10 August 2023, retrieved 17 October 2023, www.nuffieldtrust.org.uk/resource/growing-numbers-of-delayed-discharges-from-community-hospitals As Nuffield Trust says in its analysis: “It is vital that bottlenecks [in acute hospitals] are addressed rather than shifted elsewhere to the detriment of patients stuck in community beds.” ⁵ Dodsworth E, ‘Growing numbers of delayed discharges from community hospitals’, blog, Nuffield Trust, 10 August 2023, retrieved 17 October 2023, www.nuffieldtrust.org.uk/resource/growing-numbers-of-delayed-discharges-from-community-hospitals

It is fair to say that delayed discharges would likely have been higher in the winter of 2022/23 without the emergency funding, but that the same amount of money could have been spent more effectively to achieve better outcomes than it eventually did. 

As an example of how longer-term, more consistent funding might have had better outcomes, we should look at how local authorities and providers actually spent emergency funding. Adult social care capacity is driven predominantly by the number of staff that providers can employ. But short-term funding made it difficult for providers to quickly and sustainably expand the workforce knowing that funding for salaries would run out at the end of winter. ⁶ Hoddinott S and Davies N, 'Adult social care: Short-term support and long-term stability', Institute for Government, March 2023, www.instituteforgovernment.org.uk/publication/adult-social-care Even when providers were willing to take on more staff, there was a lag between creating a vacancy and employing and training an individual to do the job, meaning that the last-minute funding took a long time to filter through to increased capacity. Interviewees also reported that instead of waiting to fill vacancies, local authorities and providers spent most of the money on measures such as providing staff with one-off bonuses to discourage them from leaving, ⁷ Institute for Government interview.  bringing forward the scheduled national living wage increase, or using expensive agency staff who do not represent good value for money. ⁸ Institute for Government interview.  This may have helped in the short term but will not provide the type of increased stability that longer-term investment in measures such as improved training or career progression might have. 

Other examples of ‘crisis-cash-repeat’ also demonstrate poor value for money. The Department of Health and Social Care (DHSC) ran an evaluation of the Workforce Recruitment and Retention Fund, which allocated £462.5m of funding for growing the social care workforce during the pandemic. It found that “the number of staff recruited between the funded period and baseline period is not statistically significant”. ⁹ Department of Health and Social Care, ‘Workforce Recruitment and Retention Funds: outcomes and findings’, 26 January 2023, retrieved 17 October 2023, www.gov.uk/government/publications/workforce-recruitment-and-retention-funds-outcomes-and-findings/workforce-recruitment-and-retention-funds-outcomes…  Despite little impact on recruitment, there was improved retention, leading to an increase of 2.9 million staff hours compared to baseline. But that expanded capacity was expensive, costing the government £160 per additional hour, ¹⁰ Department of Health and Social Care, ‘Workforce Recruitment and Retention Funds: outcomes and findings’, 26 January 2023, retrieved 17 October 2023, www.gov.uk/government/publications/workforce-recruitment-and-retention-funds-outcomes-and-findings/workforce-recruitment-and-retention-funds-outcomes… far above the £10.11 that was the median hourly rate paid to care workers in the independent sector in March 2023. ¹¹ Skills for Care, The state of the adult social care workforce in England, October 2023, retrieved 17 October 2023, p. 117, www.skillsforcare.org.uk/Adult-Social-Care-Workforce-Data/Workforce-intelligence/documents/State-of-the-adult-social-care-sector/The-State-of-the-Adu… The evaluation explicitly pointed to the short-term and last-minute nature of the funding as a reason for its ineffectiveness. 

Without extra funding, reforming the charging model for adult social care in 2023 would have been difficult

In 2021, the government launched plans for major reform of adult social care in its People at the Heart of Care white paper ¹² Department for Health and Social Care, People at the Heart of Care: Adult social care reform white paper, Cp 560, The Stationery Office, 2021, www.gov.uk/government/publications/people-at-the-heart-of-care-adult-social-care-reform-white-paper 
  and of the charging model for the sector in the Build Back Better white paper. ¹³ Department for Health and Social Care, Build Back Better: Our plan for health and social care, Cp 506, The Stationery Office, 2021, www.gov.uk/government/publications/build-back-better-our-plan-for-health-and-social-care But these plans have since been substantially pared back, with the government delaying plans for charging reform and, in April 2023, reducing funding allocated for other reforms. Those decisions break Boris Johnson’s promise to solve the social care crisis “once and for all” ¹⁴ Espadinha M, ‘Prime Minister vows to fix social care crisis’, FT Adviser, 25 July 2019, retrieved 17 October 2023, www.ftadviser.com/pensions/2019/07/25/prime-minister-vows-to-fix-social-care-crisis and push the question of reform into the next parliament, at the earliest. 

The delay in charging reforms will likely be very disappointing to both the users of social care and those who work in the sector. However, interviewees said that the combined pressures of stabilising a market in crisis and implementing a complex set of charging reforms would have been difficult for local authorities, given the resources available to them. ¹⁵ Institute for Government interviews.  Councils are under-resourced in terms of both funding – with many arguing that the money allocated for charging reforms was far below the amount needed to make them a success ¹⁶ County Councils Network, ‘New analysis warns government has ‘seriously underestimated’ the costs of adult social care charging reforms’, press release, 18 March 2022, retrieved 17 October 2023, www.countycouncilsnetwork.org.uk/new-analysis-warns-government-has-seriously-underestimated-the-costs-of-adult-social-care-charging-reforms – and staff and capacity. ¹⁷ Care England, ‘Inadequate Funding Undermines Social Care Reforms’, press release, 26 May 2022, retrieved 17 October 2023, www.careengland.org.uk/inadequate-funding-undermines-social-care-reforms A report from Newton and the County Councils Network estimated that local authorities would need to hire an additional 4,300 social workers – an increase of 39% from current numbers – and 700 more financial assessors, an increase of 25%. ¹⁸ Newton and County Councils Network, Preparing for reform, 26 May 2022, p. 32, https://futureasc.com/reform  The current backlog in care assessments would also have been exacerbated by the government’s charging reforms, which would have generated a large increase in assessments for local authorities to carry out. ¹⁹ LaingBuisson, Impact Assessment of the Implementation of Section 18(3) of The Care Act 2014 and Fair Cost of Care: A report commissioned by the County Councils Network, March 2022, p. 7, www.countycouncilsnetwork.org.uk/wp-content/uploads/LaingBuisson-Impact-Assessment-of-Section-183-FCC-FINAL-1.pdf

It is also important to emphasise that charging reforms would not have increased the amount of funding available for the sector, but rather changed the source of that funding. While the improved generosity of the means test would have helped some, reforms would not have changed many of the fundamental issues in the service, such as relatively low pay or care packages that leave many with unmet or under-met needs. 

Cost pressures mean that increased funding might not achieve all the government’s objectives

In total, spending on adult social care will rise by approximately £2.8bn between 2022/23 and 2023/24 in cash terms – the largest increase since at least 2009/10. This is a combination of new money announced in the 2022 autumn statement, previously planned changes in spending, and an additional £365m of funding through the Market Sustainability and Improvement Fund (MSIF), ²⁰ Department of Health and Social Care, ‘Market Sustainability and Improvement Fund - Workforce Fund: policy statement', 31 August 2023, retrieved 17 October 2023, www.gov.uk/government/publications/market-sustainability-and-improvement-fund-workforce-fund/market-sustainability-and-improvement-fund-workforce-fun… which the government announced in July 2023. But providers’ cost pressures are severe, so it is unlikely that the funding will achieve its stated objectives. 

The sources of these cost pressures are multifaceted. First, a substantial proportion of the social care workforce are paid the national living wage (NLW). The government increased the NLW by 9.7% in April 2023, to compensate low-paid workers for rising inflation. ²¹ Low Pay Commission, ‘The National Minimum Wage in 2023’, 31 March 2023, retrieved 17 October 2023, www.gov.uk/government/publications/the-national-minimum-wage-in-2023/the-national-minimum-wage-in-2023  The Care Policy and Evaluation Centre estimates that 62.5% of the wage bill in adult social care is spent on staff who are paid the NLW, ²² Hu B, Hancock R and Wittenberg R, Projections of Adult Social Care Demand and Expenditure 2018 to 2038, Care Policy and Evaluation Centre at the London School of Economics, December 2020, p. 9, www.lse.ac.uk/cpec/assets/documents/cpec-working-paper-7.pdf meaning that any increases have a large effect on spending for adult social care. Using this proportion, the 9.7% rise in the NLW will cost providers approximately £1bn in 2023/24.