Fixing social care: the six key problems and how to tackle them

The government has established a commission, led by Baroness Louise Casey, to set out recommendations for a ‘fair and affordable’ social care system. It will begin by ‘identifying a commonly agreed picture of the problems faced’.

So what are those problems? Different people have different opinions about what is ‘wrong’ with social care and how to fix it, but the problems boil down to six issues, consistently identified by a wide range of people and organisations.

These problems are not just immediate. With demographic changes – an ageing population and more working-age adults living with complex disabilities – any view of the problem and the fixes must look not just at today but decades ahead.

This long read is an updated version of analysis we first published in 2019, when the then Prime Minister, Boris Johnson, promised to ‘fix’ social care once and for all.

In addition, it also includes contributions made at two workshops, supported by the Joseph Rowntree Foundation, from policy-makers, people who draw on services and other people working in the sector.

1. Means testing: it's not like the NHS

What’s the issue?

The social care system in England restricts access to publicly funded care to people with the highest needs and the lowest assets.

Local authorities only support people with needs that are assessed as immediate and significant – and this barrier has, in practice, been raised in recent years as councils have come under financial pressure. In 2023/24, 14,000 fewer people received long-term care than in 2015/16. There is no agreement about the overall level of unmet need (partly because it depends on what you think people should be entitled to), but Age UK estimates that 2 million older people are not getting the care and support they need.

Even if people’s needs are high enough, they may still not receive publicly funded support because it is available only to people with assets below £23,250 (for residential care, this figure includes the value of someone’s home). Even then, they will be expected to make a sizeable contribution towards care costs from their income.

People who fail to qualify for publicly funded care, either because their needs are assessed as too low or their assets are too high, have to rely on family and friends for their care, go without care entirely, or pay for it themselves. And there is no limit on the amount that someone may pay towards their care costs in their lifetime. The figures can be immense (economists call them ‘catastrophic’ for good reason): 1 in 7 people over 65 will run up care costs of over £100,000 in their lifetime, which in many cases will have to come from the value of their homes.

Which options are cited to tackle access?

Reduce the level of need required to receive publicly funded social care. Currently, following years of reductions that started well before ‘austerity’, people only receive support if they have needs that are, in effect, classified as ‘substantial’ or ‘critical’. This could be reduced to include needs classified as ‘moderate’, or even further – some argue that all needs preventing someone from living an independent life should be met or that lower-level needs should be addressed to prevent them worsening.

An NHS-style funding system. This would do away with means testing entirely and make comprehensive social care support free to those who need it, irrespective of income and savings (similar to the way the NHS works and to how adult social care works in countries such as Denmark). However, this would be very expensive. (Estimates of costs for different systems are included in the ‘Paying for it’ section below.)

Free personal care. This improves, but does not eliminate, means testing because some types of care become free – for example, help with washing and dressing at home. This is the system that operates in Scotland. However, it excludes much social care, including support for lower-level needs (so-called ‘mopping and shopping’ services), wider support in the community, and accommodation costs in care homes (in Scotland, people get less than £250 a week towards costs but bills may be more than £1,000).

Make the means test more generous. Means testing could also be limited by raising the point at which people have to pay for their own care from £23,250 (a figure that hasn’t changed since 2010) to a much higher figure. In 2011, the Dilnot Commission on Care and Support recommended this should be £100,000, while the government prepared legislation that would have raised it for residential care to £118,000 in 2016. In Wales, the figure is already £50,000 for people in care homes.

A cap on an individual’s care costs. This would keep the needs test and the means test but people would ‘log’ how much they spend on eligible care costs and once they reach a certain point (a ‘cap’), the state would take over payment. In 2011, the Commission on Care and Support recommended this cap should be set at £25,000–£50,000, and in 2013 the government proposed, but did not implement, a cap of £72,000. A cap might be a complicated system to administer, and some people would still need to spend a lot of money as not all care expenditure would count towards it.

Private insurance. These are policies that people take out to protect themselves against care costs – either a one-off payment on entering a care home or a regular payment starting when relatively young (long-term care insurance). Only a minority of people take these up, however, and international evidence suggests that long-term insurance schemes are not an effective solution to long-term care costs because most people do not purchase them.

Social insurance. In many countries, everyone pays into a social insurance fund during their lifetime; in return, they receive financial support and/or services if they develop a social care need. However, they may not receive the full amount of their care and still have to contribute – sometimes significant amounts – towards its cost. Social insurance models operate successfully in countries including Germany, Japan, Austria and South Korea, and are being piloted in cities across China.

Support for families and communities. In practice, statutory social care services are only a part of the support that people need to stay independent and well in their communities when living with long-term care needs. Families provide vital informal care, and voluntary organisations offer services that may sit outside of the formal care services but help ensure people can retain their health and wellbeing. So support from family carers – for example, through better respite care – and voluntary organisations is a crucial supplement to formal care eligibility.

2. Quality of care: 15-minute care visits and neglect

What's the issue?

The term ‘quality’ covers a wide range of perceived issues. There is basic concern among the public about quality, illustrated by 15-minute care visits in home care but extending to fears of abuse and neglect in care homes. Some focus on the consequences of having an unregistered and undertrained care workforce. Others question the model of delivery itself, particularly a reliance on institutional care and a perceived lack of choice and control for service users. Care Quality Commission ratings suggest that around 1 in 6 services are below standard.

Which options are cited to improve quality, and would they work?

Commission for quality not just price. Local authorities’ approaches to commissioning care services have typically been driven by a desire to minimise costs. As the Department of Health and Social Care acknowledged to the National Audit Office in 2021, this has created a market in which local authorities pay below the sustainable level for many services. It might be expected that paying more for services would drive up quality by ensuring provider stability, bringing in more providers (and therefore increasing choice), and feeding through into quality through higher wages and therefore improved staff recruitment and retention. However, even if this happens, there are other factors involved in quality – most obviously organisational ethos and culture – that are not immediately affected by higher fees. So, while improving rates is necessary, it is likely to be a crude instrument for improving quality.  

Better regulation, monitoring and support. This would focus on improving the effectiveness of regulators as a route to better quality. That will require a reinvigoration of the Care Quality Commission, which has failed to provide the quantity and quality of inspections required in recent years. Some organisations also argue for higher registration standards for providers. Any attempt to improve the quality of provision would inevitably require additional practical support for struggling providers (as provided to hospital and GP practices, for example). Some local authorities already bring together and support care home managers in a bid to drive up quality.

Improve information for purchasers. Although social care is mainly provided by competing private sector organisations in a free market, it is not a market in which it is easy for people to make informed choices, especially when those choices are often made at times of crisis. Improving information about the quality and cost of care on offer and making it easier for people to raise concerns about services they are receiving might improve quality. In Australia, for example, a large survey of care home residents is used to inform the quality rating of providers.

Workforce development. Staff need appropriate training and support to carry out complex, difficult tasks . See workforce pay and conditions section for more detail.

Direct payments. A key direction of the 2014 Care Act has been to give service users their own budgets to spend, partly to offer them greater flexibility and partly to develop a more effective market for service providers. For some people this approach is life changing but evidence is unclear about outcomes overall and direct payments have not spread as widely as hoped, especially among older people.

Wider reforms. For some, the way social care services are commissioned and provided needs to change more fundamentally. Typically, this involves a move away from institutionalised, professionalised care towards much broader forms of support, exemplified by services such as the Shared Lives scheme and other strength or asset-based approaches. Again, though, these models may work better for some people, for example, working-age adults with learning disabilities, than others.

3. Workforce pay and conditions: underpaid, overworked staff

What’s the issue?

There aren’t enough staff working in adult social care – there are around 111,000 vacancies at any one time. Most observers believe that better pay is the critical factor in recruiting more staff. Although pay has risen as a result of the National Living Wage, care workers are still paid, on average, less than shop assistants and health care assistants in the NHS. Conditions of employment are also a factor, with more than half of home care workers employed on zero-hours contracts. Most are not members of trade unions. Staff often don’t receive the training and support they need to carry out complex, difficult tasks for vulnerable adults, and they lack a career structure – care workers with five or more years’ experience are now paid, on average, only 4p an hour more than new entrants.

Which options are cited to improve workforce pay and conditions, and would they work?

Better basic pay, terms and conditions. Increasing basic pay is essential, and pay differentials between junior and senior staff need to widen. The government plans a ‘fair pay agreement’ in adult social care to do this, which would be negotiated between trade unions and providers. However, what this would look like will only be established in 2026, when a formal negotiating body is set up, and increased pay will not come into effect until at least 2027. There are also continued concerns among providers about whether it will be fully funded. What constitutes 'fair pay’ differs among organisations: some want to see a minimum set at around the level of the real Living Wage, while others argue for full pay parity with comparable NHS roles.

Developing workforce strategies. Skills for Care, the industry workforce body, has led a sector-wide process to establish a social care workforce strategy that includes findings and/or recommendations not just on pay but also recruitment, terms and conditions, training and culture, where research has shown challenges about attitudes to, for example, young people. It argues that a strategy also requires work to change the public image of social care roles. Some progress has been made but key measures, such as a government-led recruitment strategy for social care, have still not been implemented.

Regulation/registration. In Scotland, Northern Ireland and Wales, registration schemes require care workers to reach a minimum level of skill or qualification. The cost-effectiveness of these approaches isn’t clear, though, and there is a risk that some workers may be deterred from joining or staying in the sector.

Training and career development. Comprehensive training clearly needs to be available to the care workforce, either directly or through their employers, since they are caring for people with complex conditions. In practice, however, the extent of training is patchy. Career progression is also important and the ‘care workforce pathway’, introduced in 2024, aims to provide clear career pathways and development opportunities. However, all of these measures require additional funding to be effective.

Bringing the workforce into the public sector. The most radical approach is to bring some, or even most, of the social care workforce into the public sector, as the Labour party proposed in 2019. This would lead to improved terms and conditions for staff, but beyond this it is not clear what additional benefits it would bring to people needing care. Nor is it what service users (including those who currently pay for their own care) necessarily want. This would also have to be funded.

Overseas recruitment. The introduction of the health and care visa in 2022 led to a surge in the number of overseas care workers coming to the UK and a fall in social care vacancy rates. However, these visas have now been withdrawn amid public concern at levels of immigration, and there remain concerns about the ethics of recruiting staff from other countries. It seems unlikely that overseas recruitment can be a significant source of care workers in the near future, though some employers argue for a ‘transition’ away from reliance on overseas recruitment rather than a hard break.

4. Market fragility: care providers struggling to stay in business

What’s the issue?

Most social care services are commissioned by local authorities but delivered by thousands of mainly private companies. Over the past decade, local authorities have increased fees significantly to reflect the increased costs faced by providers (funded in part by the Market Sustainability and Improvement Fund, introduced by the government in 2022). However, provider costs have been rising at least as quickly, and in 2025/26 estimates suggest that while fees increased by around 5%, costs increased by 8–10% due to increases in the minimum wage and employers’ National Insurance contributions. This market situation has led to concerns about provider viability and to imbalances in the market, as providers focus business on self-funded clients who pay more than council-funded ones.

Which options are cited to strengthen it, and would they work?

Paying more. If local authorities paid providers more for care, it should improve market stability. Appropriate fee levels should also allow for return on investment for much-needed capital improvements to be made. Providers who have focused purely on self-funders might also return to publicly funded care, increasing capacity. Of course, it would require more money.

Standardised rates. At the moment, 153 local authorities commission services at rates individually, which reflect, at least in part, the council’s wider financial situation. In 2021, the Department of Health and Social Care acknowledged that this resulted in many services being commissioned at rates that were unsustainable. Provider representatives argue that many local authorities pay less than the viable rate for care. Some people argue for a higher standard set of fees – either nationally or for different parts of the country – that would be updated annually and reflect the evidenced costs of care provision. This degree of price security, it is argued, would allow for longer-term investment in care services. For some, however, standardised rates should be linked to stronger financial supervision of care providers to ensure fair profits.

Bringing services in-house. Some argue that bringing more provision of social care into the public sector (or prioritising voluntary sector provision) would resolve market problems and be more ethical. Some local authorities are considering elements of this (and some NHS trusts provide social care services), often to resolve local supply problems. This could be difficult to put into practice, though, and most likely would increase costs because in-house provision typically costs local authorities more than buying it. There is also little if any evidence that focusing on voluntary sector or public sector provision necessarily improves service quality.

Market shaping. Local authorities have a duty to ‘shape the market’ for care provision in their areas, but in practice few have taken this role as broadly as it was intended. In many places there exist important gaps in the market, for example in extra-care housing. Local authorities could – and some now do – take a more active role to support and develop local care providers, ensure market gaps are filled, commission with broader ‘social value’ objectives, and sometimes step in to provide services where the market cannot. Again, though, this would come at a price and require strong planning, commissioning and management expertise.

5. Disjointed care: delayed transfers of care and lack of integration with health

What’s the issue?

Too often, people receive fragmented care, which can have a negative effect on their experiences, lead to poorer outcomes, and create inefficiency within health and care. Yet efforts to join up the systems have been held back by the fundamental cultural and structural differences between the two, which go back to the establishment of a free NHS and a means-tested social care system in 1948. The problem is routinely exemplified by patients stuck in hospital while they wait for social care services, but it can also mean people discharged too early into the wrong sort of care, or under-investment in preventive services such as reablement. The boundary between the two systems is also riddled with complexity and controversy, exemplified by NHS Continuing Healthcare, where if someone is assessed as having a ‘primary health need’, the NHS will pay their social care costs.

What options are cited to join up care, and would they work?

Narrowing the eligibility gap between the systems. Giving more people access to free social care, similar to the NHS, would reduce one difference between the two systems, with the potential to create faster and more efficient interchanges between the two. The Barker Commission, for example, proposed making all care free to those with the highest needs. However, simply widening eligibility is not a panacea to all problems and will inevitably cost money.

Integrated planning. Integrated care systems (ICSs), introduced in 2022, were intended to bring all partners in health and care systems together, but the current government has radically remodelled ICSs. Though the impact of the change is still not certain, it may put more responsibility for developing joined-up health and care plans onto local authority health and wellbeing boards (HWBs). However, the capacity of these boards varies significantly from place to place.

Integrated delivery. The government’s 10 Year Health Plan places strong emphasis on integrated neighbourhood teams, intended to bring together GPs, nurses, social workers, pharmacists, care workers, paramedics and voluntary sector staff to provide co-ordinated care closer to home. While this is welcome, integration is not simply a matter of physical location: cultural and other issues will also need to be tackled. There are also obvious inequalities in pay, terms and conditions between NHS and many social care staff.

Pooled budgets. Local authorities and the NHS often choose to pool budgets under a ‘section 75’ agreement when working in areas that require joined-up work – for example, reablement. A key use of section 75 agreements is to the Better Care Fund, a national government initiative that requires the NHS and local authorities to pool a minimum amount of funds each year and develop joint plans for spending it based on national priorities. In 2018, a review found that this pooling had made an impact on delayed discharges, but there are consistent tensions around the use of the Better Care Fund and one study in 2020 concluded that there are ‘major cultural, operational and territorial barriers to overcome’.

Reform of NHS Continuing Healthcare. NHS Continuing Healthcare (CHC) is a joined-up package of health and social care services to meet the needs of people with very complex conditions or who are at end of life. Because it is funded by the NHS, it is free to those who qualify for it, unlike social care, which is funded by local authorities. However, people complain of an extremely complicated assessment process, and reviews of CHC have found large variations between different NHS areas when it comes to eligibility. Local authorities complain that tighter eligibility for CHC effectively shunts social care costs on to councils.

Technology. Technological advances, such as joint care records, can improve communication and join-up care. Although the social care sector is under-resourced, diverse and fragmented, it sometimes has the capacity to move quickly, as with implementation of digital care records. Leadership across health and care is crucial to support cross-working and ensure co-ordinated procurement.

Direct payments. Individual social care budgets – ‘direct payments’ (see section on quality of care) – can be combined with personal health budgets to give individuals greater choice and control and to help the individual integrate services around themselves. However, the experience within social care suggests that while these have the potential to be life changing for some people, they may not be suitable for everyone.

6. The postcode lottery: unwarranted variation in access and performance

What’s the issue?

Although the rules on entitlement to publicly funded social care are set nationally, access to social care varies depending on where people live. Unlike the NHS, each local authority makes its own decisions about budgets and services, so some spend more per head and/or provide more short or long-term support than others. One local authority, Hammersmith and Fulham, even provides free personal care to its residents. The reasons for these differences can be hard to explain. Some variation may be reasonable responses to local circumstances – ‘postcode choice’ rather than postcode lottery – and can reflect the different amounts of money local authorities get from government and council tax. This may affect the amount and quality of care providers available, not just for publicly funded care users but for self-funders, too.

Which options are cited to even it out variation, and would they work?

Understand it better. The assumption behind some discussion of performance, for example on delayed transfers of care, is that much variation in performance is unwarranted. But we simply don’t know.

Provide consistent levels of funding. To fund services, local authorities are increasingly reliant on funds they raise themselves, for example through the social care precept (an addition to council tax). But the authorities that raise the least through council tax tend to be the most deprived areas which, on average, have most need to spend on social care. Returning to a model of funding that more closely links the need to spend with the amount received is important (the current government’s fair funding review aims to do this).

Spread best practice and support poorer performers. The social care sector has never benefited from a fully developed programme to identify and share best practice, such as –  in health care – the NHS Getting It Right First Time (GIRFT) programme, which offered support far beyond that which national social care bodies or local government’s peer review process could provide. There is also little intensive support available to providers who are struggling.

Tighten national oversight. Previously, there was independent, national oversight of how well local authorities carried out their duties, but the Care Act 2014 finally took away the power of the Care Quality Commission to oversee social care commissioning. Some or all of this scrutiny could be reintroduced, alongside existing Care Quality Commission responsibility to review local authority performance.

National assessment. A more radical approach would be to introduce national assessment of financial and needs eligibility for adult social care. This is a feature of many social care systems around the world and might create greater consistency. However, it would involve a shift away from the principle of a social care service that is fully run by local authorities.

What’s the problem with social care funding?

Lack of funding is often cited as the key problem facing adult social care. Yet without clarity on the preferred solutions to the six key problems, it is not possible to say how much money is required to fix it – or how any extra money should be raised.

Where does funding currently come from?

The issue is complicated because people’s social care needs are currently met by a combination of public and private spending.

Public funding for social care is the majority of spending. In 2023/24, local authorities spent a total of £32 billion on care. This money comes mainly from local authorities’ own spending power (largely raised from council tax and business rates). From 2016/17, councils have also been able to raise a small amount of additional income from an extension of council tax, called the ‘social care precept’.

Council income has also been supplemented with central government grants. These are often short term to tackle specific identified issues, such as delayed hospital discharge, provider fee rates or workforce problems. Other social care funding for local authorities comes from the NHS, which contributes to the costs of some local authority social care services.

However, people receiving publicly funded social care are also required to contribute to its costs and many people are not entitled to public funding at all. So a significant proportion of adult social care spending comes direct from individuals. This happens in a number of ways:

• Those who fall outside of the state-funded system entirely have to pay all their costs themselves. The Office for National Statistics estimates that just under a quarter of home care users and over a third of residential care users are self-funders.

• People who qualify for public funding nonetheless still have to contribute towards its cost from their assets and/or income. In 2023/24, local authorities raised £4.1 billion in fees and charges.

• Some families additionally pay extra fees to ‘top up’ the fees paid by local authorities for the residential care provided to their relatives. There has never been a reliable estimate of the percentage of families who contribute in this way or the amount they pay.

How could funding change?

There is therefore a fundamental question around funding that needs to be resolved: what percentage of care costs should be paid personally from people’s own pockets and what percentage should be paid by the state, with the costs shared across the wider population, whether through local taxation such as council tax or national taxation such as income tax?

Should individuals take responsibility for their own care?

One argument is that everyone should take responsibility for their own potential care costs by saving and/or taking out insurance against their likely costs. However, people’s need for care varies hugely and unpredictably. Some people will have an accident or a medical event such as a stroke early in life and need support from a younger age. Some will go on to develop dementia and some of these will need long-term care in a residential home. Others will require no care, or only a limited amount at the very end of their life.

Pooling risk

The uncertainties mean that it is not possible for people to judge their future liabilities. In addition, at least partly because the need for social care is not something people like to think about, it has also proved difficult to create an insurance market for it – no companies currently offer long-term care insurance in England (and there is no more than low take-up in all other countries).

In these circumstances, the advantage of state spending is that it can ‘pool risk’ to avoid or reduce the chances that any one individual is faced with very large personal expenditure. ‘Pooling the risk’ means that everyone contributes – for example, by paying into a compulsory social insurance scheme (as in Germany, for example), or more simply, by paying tax to government. People can then access support if they need it.

Public attitude suggests acceptance of some individual responsibility but a belief that most risks should be pooled.

Figure 1: Views on the balance of responsibility for social care

It would be helpful to understand the current split of spending between the individual and the state – the degree to which risk is actually being ‘pooled’ – but in practice we don’t know for sure. There is no up-to-date estimate of the full extent of individual spending on adult social care, though in 2016/17 the National Audit Office estimated it at £10.9 billion.

It is likely that over the past decade the private share of spending has increased because the financial thresholds, which determine whether people will receive any state support at all, have not risen in line with inflation. In addition, local authorities have applied increasingly tight assessments of people’s needs and fewer older people now receive publicly funded support. As a result, more people are likely to have had to fund their own care.

Views on the desired extent of risk pooling also heavily shape responses to the debate about the future of social care funding. There is wide agreement that not enough funding is raised to meet population needs for social care, and these are expected to grow further in future because of increased disability and population ageing. In addition, many people are currently excluded from any state support.  

What amount of additional funding is needed?

There are a range of potential targets for additional funding, all related to the problems identified in this long read. For example:

• The Health Foundation estimates that a Dilnot-style ‘cap’ set at £86,000 could cost an additional £0.5 billion in 2026/27, rising to around £3.5 billion a year by 2035/36. Free personal care, similar to that in Scotland, could cost around £6 billion extra in 2026/27, rising to £7 billion by 2035/36. Introducing an NHS-style model of universal free care could cost around £17 billion in additional funding by 2035/36.

However, improving access is only one of the problems facing social care. For example, Skills for Care estimates that increasing pay for careworkers to £1 more than the National Living Wage would cost £3.2 billion a year, with a net cost to the taxpayer of £2 billion.

Should these additional needs be met by raising more state funds for social care, and if so, how should the funds be raised? Or should individuals be planning to pay more out of their own pockets? Or both?

Most proposals to raise additional funds for social care in recent years have involved greater state ‘risk pooling’. However, none has been implemented.

In a 2009 Green Paper, the Labour government floated a number of alternative social care reforms, including a £10,000 levy on people’s estates at death to fund a comprehensive, free-at-point-of-need social care service. This blew up into a ‘death tax’ row at the 2010 election and the government was not re-elected.

In 2015 and 2017, legislation for an extended means test and a cap on lifetime care costs, which would have been funded from general taxation, was first postponed and then abandoned by the then Conservative government.

In 2021, the Boris Johnson administration legislated for the introduction of a ‘health and care levy’, which would have raised additional funding for the NHS and social care from an increase in the rate of national insurance. Again, this would have funded the introduction of a more generous means test and a ‘cap’ on the amount that any individual would pay for social care over their lifetime. However, it was abandoned when Johnson stepped down as Prime Minister in 2022.

The Nuffield Trust has this guide to the various options that have been proposed for funding social care and their pros and cons.