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The Actuary The magazine of the Institute & Faculty of Actuaries

Social care spending variations puzzle IFS

Spending on adult social care by English councils plummeted by 11% in real-terms between 2009-10 and 2015-16, with some 85% of them making at least some cut, and 10% of cuts exceeding a quarter.

Care Costs iStock 524010120
Spending on adult social care has plummeted ©iStock

These are among the main findings by researchers at the Institute for Fiscal Studies (IFS), funded by the Health Foundation. 

Spending fell by most on average in London at 18%, and by 16% in metropolitan districts.

Generally, cuts were larger in the north than the south and larger in areas that, before 2010, had been the highest spenders on adult social care.

The research also found significant variation in councils’ social care spending, varying between £325 per adult resident in the lowest tenth of councils, and £445 in the highest spending tenth.

Councils tended to spend more on social care when they had higher proportions of people over pension age - particularly those entitled to means-tested benefits. 

Higher local earnings levels were also found to be associated with higher levels of social care spending.

The research though found no clear relationship between local authorities’ own spending and fee income from self-funding service users. 

It was not the case that all high spenders charged lower fees, nor that all low spenders relied on high income from co-payments.

IFS associate director David Phillips said: “One thing that stands out in these figures are the big differences in spending per adult on social care among councils assessed to have very similar spending needs by the government.

“Whether this means spending needs assessments are inaccurate, or reflects differences in available funding or the priority placed on social care relative to other services or council tax levels, is unclear. 

“But it emphasises that the government has got its work cut out in its ‘Fair Funding Review’ of how to measure different councils’ spending needs from 2019 onwards. That debate could get quite fraught.”

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