Budget 

Govt to hand councils £650m for social care

Govt to hand councils £650m for social care

Chancellor of the Exchequer Philipp Hammond has promised local authorities £650m of extra funding for social care in the coming year, as the government prepares to publish a green paper on the issue.

In his budget speech today (29 October), the chancellor pledged short-term funding of £240m in 2018-19 and £240m in 2019-20 for adult social care, as well as a further £410m in 2019-20 for adult and children’s social care. The additional funding is intended to take pressure off the NHS and improve council care offerings for children, older people and people with disabilities.

The Budget also included £55m in 2018-19 for the disabled facilities grant, as well as £84m over five years to expand children’s social care programmes to 20 further councils with high or rising numbers of children in care.

Mr Hammond confirmed the government would publish a green paper on social care in due course but said it recognised "the immediate pressure local authorities face with respect to social care".

Steven Cameron, pensions director at Aegon said: "The commitment to provide an additional £650m of funding for social care will offer some relief to councils struggling with ever increasing demands.

"However, this is little more than a temporary, sticking plaster measure and we urgently need concrete, long-term proposals in the promised green paper on how to tackle the huge issue of funding social care costs.

"Our ageing population urgently needs a stable agreement on what the state will pay and how much individuals will have to fund themselves, based on their wealth, and crucially with an overall upper limit."

It is estimated just 12 per cent of adults aged 55 or over are currently putting aside money to pay for social care when they are older.

Former prime minister David Cameron had promised to implement a £72,500 cap on social care to come into effect in April 2016.

But in 2015 the then government pushed this back to 2020 because it would have added £6bn to public sector spending at a "time of consolidation".

Last December the government confirmed the proposed cap would be scrapped while a green paper on long-term reform was put together.

The publication of this green paper was originally expected in the summer but has since been pushed back to the autumn.

Several solutions are said to be on the table, including a ‘Care Isa’ – a capped savings product, exempt from inheritance tax – and a 'care pension', which mixes drawdown and care insurance.

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