Over 80 Percent of England Councils to Overspend on Adult Social Care: Survey

A care home resident holding hands with her daughter on Oct. 29, 2021.Andrew Matthews/PA

More than 80 percent of councils in England are expected to overspend their adult social care budgets this year, an annual survey of the sector has found.

Adult social care faces “intensifying” financial pressures, as local authorities are forced to make in-year budget savings on top of those planned for 2024-2025, the Association of Directors of Adult Social Services (ADASS) has warned.

The charity, collaborating with all 153 councils in England, said that over 35 percent of directors have implemented in-year budget cuts, while 81 percent of councils are projected to exceed their adult social care budgets.

“These are not the conditions for adult social care to thrive,” ADASS said.

The figures come amid a long-standing crisis in local government financing, which has seen many councils accumulate debt and cut services to residents, including in social care, housing, environment and planning.

In the last two years, a number of councils, including Nottingham City Council and Birmingham City Council, announced effective bankruptcy. Local authorities have pointed to high inflation and rising demand in social care, for children and adults, as reasons for budgetary overspends.

The government has recognised the critical state of social care in England and vowed to create a comprehensive community-based National Care Service. Under Labour plans, the service aims to take a ‘home first’ approach that supports people to live independently for as long as possible and deliver high-quality care.

However, according to ADASS, the current financial strain on local authorities won’t allow Labour’s plans to succeed. The charity has called on ministers to commit financially in their mission to reform social care.

Extra cash will help councils achieve the government’s goal of shifting health and social care from “sickness to prevention,” the report said, adding that delayed discharge was one of the most significant barrier to preventative care.

“Adult social care at its best transforms lives. It enables millions of us to live the lives we want to lead, where we want to live. Investment in health and adult social care should not be seen as a cost to the public purse, but instead crucial to our economy’s growth and productivity,” ADASS said.

Financial Hole

Overspends on adult care budgets in the current financial represent an increase on previous years, when 72 percent of councils overspent their reserves in 2023-2024 and 63 percent the year before.

The total projected overspend on 2024-2025 adult social care budgets is estimated to reach £564 million. This is slightly down from last year’s figure of £586 million but a significant surge from £73.7 million in 2022-2023.

The report comes after Labour’s Budget announced increases to Employer National Insurance contributions (NICs), which raised concerns among employers over added costs and possible impact on wages among workers.

Care England, which represents adult social care providers in England, said that announced measures, including national minimum wage rises, will leave the sector with “an additional circa £2.4 billion funding hole to plug.”

The chief executive of Care England, Martin Green, called the government’s Budget a “missed opportunity” and the government’s £600 million grant for social care a “drop in the ocean.”

Responding to the ADASS survey, the Nuffield Trust think tank said that the adult care sector needs “meaningful” financial support, as opposed to “sporadic short-term handouts” by the government.

“With ADASS revealing councils are now on course to overspend on adult social care budgets by £564m in this financial year alone, the report starkly illustrates last week’s Budget announcement of £600m extra for adult social care next year likely won’t even touch the sides,” said Nuffield Trust Deputy Director of policy Natasha Curry.

In September, minister of state for care Stephen Kinnock vowed to work closely with adult social care sector, the NHS and other community partners to improve service resilience ahead of the winter period.