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Beyond Dilnot: the need for wider reform

For most public services, austerity is the fiscal equivalent of climate change and in the world of social care the storm clouds are gathering. That's the unequivocal message from the latest annual survey of adult care directors, which reports that councils will be spending 20 per cent less by 2014 than they were three years ago on social care. This is a troubling trend as we contemplate the needs of an ageing population and more working age people with disabilities needing care and support. It spells particular trouble for the NHS, an interdependent system grappling with its own financial and service challenges.

In our new report, Paying for social care: Beyond Dilnot, we assess what progress has been made in finding a better and fairer way of funding social care and where we go from here. It's been a long and winding road. Since 1997 we've had two independent commissions, five White and Green Papers, three consultations and enough reports to fill a library. The government's decision to implement the proposals of the Dilnot Commission –  through the Care Bill recently placed before parliament – will for the first time see the state place a limit on how much people have to pay for their care. This marks a decisive break from the means-tested 1948 settlement that focused resources on the very poorest, and instead paves the way for a more universal offer in which everyone with care needs is brought within the system. As a result of this decision more people will be entitled to publicly funded help. In a fiscal climate where the pressure is on the government to retreat from further public spending commitments, the symbolic policy significance of the government's decision should not be underestimated and helps to offset concerns that the higher level of the cap (£60,000 rather than Dilnot's recommended £35,000–£50,000) will limit the number of people helped.

But there are dangers. The new system is much more complex because of the need to identify and 'meter' how much people are spending before they reach the cap. More people will need to be assessed, and preparing for implementation will place demands on councils who are already struggling with the toughest financial squeeze for decades. Explaining to individuals and families how it will all work is a tough ask when even the experts have more questions than answers. The scope for challenge and disputation is considerable.

And whilst the Care Bill is an important breakthrough, for a growing number of people the primary issue is not protection from catastrophic care costs but being eligible for help in the first place. Eighty-seven per cent of councils limit publicly funded care to those with substantial or critical needs, ruling out those with needs deemed too low, and more people find themselves outside the public system because their income is too high or they are too wealthy.

Dilnot was tasked to recommend how costs should be shared, not the overall amount of resource needed or where it should come from. So the next stage of funding reform must address three major issues:

  • Finding the resources to fund a good system of care – in our report we summarise a range of tax, national insurance and benefit changes that could release extra money for social care, so-called 'switch spends' that will be deeply controversial. The point here is that good care is affordable – choices do exist about relative priorities, and continuing to devote only 6 per cent of public spending on older people towards essential but tightly rationed care services is not sustainable.

  • Recognising that NHS and social care spending is interdependent – we need to achieve a closer alignment of clinical commissioning group and council budgets, for example through whole-place community budgets. We have to stop thinking about 'NHS money' and 'local authority money', and adopt a strong local focus on how the public’s money can achieve the best outcomes for local people. Nationally we need a single strategic assessment of the funding needs of the whole system of care and health.

  • Shifting towards a different model in which health, care and support is better co-ordinated around individual needs and delivered closer to home – this reduces the need for formal care by prioritising reablement and recovery, and adopts an asset-based approach that emphasies what people can do rather than what they can't.

These reflect many of the ideas that came out of our Time to Think Differently programme and will expose growing anomalies in the way that NHS and social care have been funded. So the challenge now is to use the implementation of Dilnot as a stepping stone to wider reform that goes way beyond the social care system.