My Lords, I declare an interest as a vice president of the Local Government Association and as a member of Newcastle City Council.
Forty years ago, as the newly-appointed chairman of the social services committee in Newcastle, I had to come to terms with the impact of Sir Keith Joseph’s reorganisation of the health service which came into force that year. Among much else, that involved the transfer of responsibility for public health from local government, where it had largely resided for over a century, to the NHS, taking with it paramedical services such as chiropody and bath attendants. The area health authority, as it turned out, was so limited in its resources that, for a period, we as a council felt it necessary to fund the continued provision of those services by the health authority. At the same time, we hugely increased social care provision, doubled the home help service and trebled the number of meals on wheels. I am sad to say that now those services are roughly back to where they were in 1973 as a result of the pressure on the authority’s budget. Now, in a step on which the Government are to be congratulated in principle, public health largely returns to its local government home and the concept of a holistic approach to social care, involving both local government and the NHS, is enshrined in the Bill.
It is unfortunate that the previous Secretary of State, in his shadow capacity, walked out of cross-party talks which the Labour Government had initiated to
address the issue of care and its cost, and that it has taken three years to produce the proposals that we are debating. However, it is even more unfortunate that during that time not only has demand risen inexorably, but local authority funding has been severely and deliberately reduced by a greater extent than any other area of government expenditure. It is sad, but not untypical, that the Secretary of State for Communities and Local Government should not only have acquiesced in, but actively promoted, this perverse order of priorities with all it has implied for key services, including those that we are debating in this Committee.
As we have heard, the Local Government Association avers that adult social care budgets have been reduced by £2.6 billion, or 20%, over the past three years, with additional dire impacts on other services, such as leisure and housing, which should contribute to health and well-being and which are threatened with virtual extinction as local authority services by the end of the decade. The noble Lord, Lord Best, reminded us of the London Councils report and its estimate that the cost of the reforms—which, I repeat, we welcome in principle—will amount nationally to an average of £1.5 billion a year over the next four years. Apparently, the greater amounts will be spent in the first and last years of those four. London itself will be facing a bill of at least £877 million as a result of implementing the proposals.
Of course, this, in part, reflects the increasing demand from different client groups. We largely talk of the elderly, but there are other significant groups. The noble Lord, Lord Rix, has reminded us about people with learning disabilities, and there are also people with physical disabilities. These two groups are growing as medical advances have enabled them to live longer. The quality of their life, of course, is the subject of much concern and that imposes additional strains on the budget. It is another example of incremental demand that needs to be met. In addition to that, there are people suffering from mental health problems. The increasing demand so far has manifested itself as between something like 10% and 14% in these different categories. It is clear that inflation and demographic trends alone will push up the cost, as the noble Lord, Lord Best, has indicated, by some £421 million by the beginning of the next spending review period.
There is also a serious question about the amount and timing of the funding designed to assist transition to the new regime, given that this welcome increment was announced in the spending review for 2015-16, but work will have to begin before then if we are to make progress at that time. It would be helpful to know, given that part of the rationale for the changes is that a whole systems approach is likely to be more cost effective, just what savings the Government anticipate will be made and over what timescale by each of the two principal partners—local government and the health service—and in the case of the latter, by which of its several components.
Given the huge problems currently experienced in A&E—in contrast with the position under the previous Government when 98% of patients were seen within four hours—and the emerging problems that we have
read about in the past few days in general practice, how confident can we be that the basic funding projected for both partners is adequate, even before taking into account the scale of change envisaged? How do the Government respond to the comment on the spending review of the Foundation Trust Network, which warns of,
“a further major squeeze on NHS front line services as £4 billion is diverted from the NHS budget to social care”
in 2015-16. It points to fact that trusts,
“are, in many cases, struggling to meet the rapidly rising demand created by an ageing population”.
The concept of pooled budgets is welcome, but given the number of parties to the commissioning process, with local authorities joined by clinical commissioning groups commissioning hospital services and NHS England, currently the national Commissioning Board, commissioning general practice and mental health services, how will this pooling work in practice?
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Moreover, the Minister’s letter of 27 June makes it clear that,
“to stimulate real change, £1 billion of the £3.8 billion”,
which is the sum that the Government are investing in the change and allocating to pooled budgets,
“will be linked to the delivery of outcomes. So local authorities and the NHS will only benefit from this investment if they show commitment to integration and take action which makes a difference on the ground”.
Perhaps the Minister will explain what is meant by this. What outcomes are we talking about? How will they be measured, by whom and when? Will money paid up front, as presumably it would have to be, be clawed back if the outcomes are deemed insufficient? If so, given that we are talking about pooled budgets, by whom, when and from whom?
We are anxious that progress should be made in addressing the urgent need to transform the provision of social care and promote the essential joint working of health and social services in the interests of those who need such care and indeed of their carers. The whole House is united about the desirability of these objectives. I hope that the Minister will be able to respond positively to the concerns expressed by the noble Lord, Lord Best, and other noble Lords in this debate, and I offer a suggestion which could help to allay at least some of those concerns while facilitating an early start on fulfilling the aspirations set out in the Bill.
I join my right honourable friend Andy Burnham in calling on the Government to demonstrate their commitment by utilising part of the £2 billion NHS underspend that the Chancellor siphoned off in his March Budget. Some £1.2 billion could be used in the next two years to help tackle the current crisis in social care and smooth the way to the new system, which we all welcome, by relieving the pressures it will face.