Responding to the publication of the provisional local government finance settlement for England in 2025 to 2026, Nuffield Trust Deputy Director of Policy Natasha Curry said:
“The new grant money for councils announced today is welcome. It will go some way to easing what will be a very tough year for local authorities and social care.
"It’s also good to see first steps towards funding reform and allocating money more fairly. We have long warned that the fact that poorer councils find it harder to raise taxes has caused unacceptable inequalities in how much money is available for care.
“However, even if it all went to adult social care, the extra social care grant funding of £880m and national insurance contributions (NICs) funding of £515m fall well short of the £2bn of additional cost pressures we estimate from the National Living Wage and employer NICs. This figure relates to the share of adult social care paid for by councils. Even the total real terms increase in council spending from all sources is barely enough to just cover these costs.
“This will mean tough choices for local authorities between increasing fees to social care providers to recognise their costs and spending on other services. It will leave little to meet the gap we know social care faces from rising demand, tackle rising waiting lists or to improve the many other overstretched services for which local authorities are responsible. The government should monitor provider stability closely and be ready to act.
“While today’s funding news will bring short-term cost relief in some areas, ultimately care provision remains on a knife-edge for many councils and care providers. With the Health and Social Care Secretary also reaffirming today that action on a long-term plan for social care reform will start in the new year, the sector will be still starting that journey from a difficult place and there will be no time to waste.”
Notes to editors
The Provisional local government finance settlement: England, 2025 to 2026 and supporting documents are online at: https://www.gov.uk/government/collections/provisional-local-government-finance-settlement-england-2025-to-2026
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