‘£907m funding gap’ for adult social care in London by 2018

Even with efficiency savings, councils will not close the funding gap, according to new report

The funding gap for providing adult social care in London could be as much as £907m within five years, according to a new report published on Wednesday.

The research, carried out by thinktank and lobbying organisation London Councils, and supported by Ernst & Young, found a growing demand for services means even if local authorities in the captial are successful in making savings, this would not be sufficient.

The report, A Case for Sustainable Funding for Adult Social Care, estimates that London councils have the potential to make combined efficiency savings of between £240m and £735m but that leaves a funding gap.

Sarah Sturrock, strategic lead for health and adult services at London Councils, called the potential funding gap “large and scary” and stressed that local authorities could not close it on their own. “Even with all the things that local government might do, there’s still going to be a large funding gap within the next five years,” she said.

The only way the gap can be bridged, the report concludes, is if the government increases borough funding allocations or reforms how adult social care is funded.

London Councils’ executive member for adult services, Councillor Ravi Govindia, said: “We are calling on the government to decide quickly how to implement the Dilnot recommendations; remove some of the red tape which would make providing adult social care services more efficient and recognise that help will be needed to fill the funding gap as our population ages and needs more care.”

The research sets out how the government can help councils, for example by speeding up changes to data protection regulations so social workers and NHS staff can share information about clients safely.

It looked at examples where boroughs are achieving savings by working more closely with the NHS, improving procurement and developing new ways to provide social care for older and disabled people. It used this to project the level of potential savings across London councils. Jon Rowney, head of funding, performance and procurement at London Councils, said the figures in the report were “an early analysis based on individual case studies”.

Govindia said: “It is clear that even if every council could implement all the efficiency changes outlined in the report the funding gap remains daunting; the report is an urgent call to action for government and councils alike.

He added: “We need a concerted effort to ensure that boroughs are able to continue to fund both their statutory responsibilities and the range of other services they provide.”

The £907m gap is estimated with the assumption of a 5% cut in local authority budgets at the next spending review. It also assumes that the Dilnot Commission recommendations are not implemented. If they were, the funding deficit would rise to around £1.5bn.

Local authorities in London spend around a third of their overall budgets on adult social care services.