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Planned council tax increases will not create enough revenue to alleviate the growing pressure on vital services caring for older people and those with disabilities, the latest information from the Local Government Association (LGA) has revealed.
The LGA has warned that 90 per cent of councils in England were considering or have already approved plans to raise £372m for underfunded social care services in 2016/17 by using new powers to raise council tax by two per cent.
Councils can raise council tax rates by up to 1.99 per cent next year to fund local services without holding a referendum, while most district councils can increase rates by £5 at Band D level.
Councillor Nick Forbes, vice chair of the LGA, said: "The Government expects local authorities to raise council tax by nearly four per cent next year, including a two per cent precept to pay for under pressure social care services. With no council tax freeze grant next year, a Government funding settlement that assumes council tax increases and growing funding pressures, many councils feel they have no choice left but to put up council tax.
"After years of striving to keep council tax as low as possible or frozen, town halls find themselves having no choice but to ask residents to pay more council tax over the next few years to offset some of the spiralling costs of social care in 2016/17. At the same time, they are warning communities that despite council tax rising, the quality and quantity of services on offer could drop, as the income will not be enough to offset the full impact of further funding reductions next year and with the National Living Wage bringing a significant further cost pressure from April.”
Offsetting the impact of further funding reductions
Local councils have called for increased flexibility in setting council tax rates. During the Spending Review, the Government announced that England’s 152 social care councils can increase council tax by up to two per cent (an increase of 3.99 per cent in total) in 2016/17. Income created from this change must be spent on social care services.
England's social care councils will receive £2.5bn less core Revenue Support Grant from central Government to run their local services in 2016/17. Of 152 social care authorities, 143 have already introduced or are considering the extra social care precept in 2016/17, raising £372m to pay for social care services.
The majority of the £372m additional income could be spent covering the cost of introducing the National Living Wage from April 2016. While the LGA has estimated that England’s social care authorities would need at least £330m to cover increased costs to residential care and home care providers in 2016/17 as a result.
Council leaders have warned that council tax rises would be unlikely to prevent the need for additional cuts to social care services and avoid consequences surrounding the quality and availability of care for older people and those with disabilities.
Furthermore, councils will continue to divert money from other local services, such as: filling potholes, maintaining parks and green spaces, running children’s centres, leisure centres and libraries to plug the increasing social care funding gap.
Vital services remain at risk
Local council leaders have called for the Chancellor to use his Budget next month to bring forward the £700m of new funding earmarked for social care through the Better Care Fund by the end of the decade to 2016/17.
Cllr Forbes continued: "Councils will continue to do all they can to maintain the services that older and vulnerable people rely on but services supporting the elderly and disabled are at breaking point. It cannot be left to council taxpayers alone to try and fix them.
"Vulnerable members of the community still face an uncertain future next year where the dignified care and support they deserve, such as help getting dressed, fed or getting out and about, remains at risk. Vital social care services will increasingly be unable to help ease the growing pressure on the NHS and the threat of a care home crisis is still very real.
"That is why, at the very least, the planned £700m of new funding from the Better Care Fund should be brought forward to 2016/17 in order to help alleviate growing social care pressures.”