The Local Government Association (LGA) has warned that councils could face a budget blackhole amid growing concerns about underfunded adult social care reforms.
Ministers announced last year that £36bn will be invested in the health and care system over the next three years funded by a 1.25% levy on national insurance. However, only £5.4bn of this is earmarked for social care in England.
As councils plan their service budgets from April, the LGA said that many were increasingly concerned that the funding allocated for reform falls far short of the likely costs involved.
Issues highlighted include the “fair rate of care” that councils will pay providers and tackling the issue of self-funders paying more than those who access support at the council rate.
Cllr David Fothergill, chair of the LGA’s Community Wellbeing Board, said that it was “becoming increasingly clear” that the funding allocated to councils through the levy was likely to be insufficient.
“This is shaping up to be one of the biggest financial risks councils face in the coming spending review period and we should not underestimate the potential for underfunded reforms to tip them over the financial edge,” he added.
Wokingham Borough Council said that if the plans weren’t changed, it faced extra costs of £29m, representing more than 20% of its total budget.
“Frankly, I have no idea how we could afford that staggering cost and so we need an urgent conversation with the government to make sure they understand the issue,” said Cllr Charles Margetts, Wokingham’s executive member for health, wellbeing and adult services.
The LGA called on the government to work closely with councils on detailed costings and publish its consultation on the associated guidance at the earliest opportunity.
A government spokesperson said: “We are committed to the delivery of world-leading social care with far-reaching reforms backed by £5.4bn over three years, which will then rise.”
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