Millions face council tax rises as Osborne announces new social care funding plan
Councils will be able to add 2% to council tax bills in a bid to provide up to £2 billion for social care, the Chancellor has confirmed.
George Osborne faced criticism yesterday for offering an immediate £3.8 billion cash injection for the NHS while planning cuts in other areas, including public health.
He used his spending review to confirm that social care – which experts say cannot be viewed separately from the NHS – can expect a cash boost via local councils.
Adding 2% to council tax would raise up to £2 billion if all councils adopt the new precept, which must be spent on adult social care, he told MPs.
Mr Osborne also said he expects the NHS to deliver £22 billion of efficiency savings in England and the Department of Health has agreed a 25% cut from its Whitehall budget.
Mr Osborne said: “The NHS budget will rise from £101 billion today to £120bn by 2020-21.
“This is a half a trillion pound commitment to the NHS over this Parliament – the largest investment in the health service since its creation.
“So we have a clear plan for improving the NHS. We’ve fully funded it.”
He said there would be 800,000 more elective hospital admissions, five million more outpatient appointments, two million more diagnostic tests, cancer testing within four weeks and “a brilliant NHS available seven days a week”.
Regarding social care, he said the health service could not function effectively without good social care.
He said: “The truth we need to confront is this: many local authorities are not going to be able to meet growing social care needs unless they have new sources of funding.
“That, in the end, comes from the taxpayer.
“So in future those local authorities who are responsible for social care will be able to levy a new social care precept of up to 2% on council tax.
“The money raised will have to be spent exclusively on adult social care – and if all authorities make full use of it, it will bring almost £2 billion more into the care system.”
He said the Better Care Fund – which oversees integration between the NHS and social care – would have an extra £1.5bn by 2019-20 for local authorities to access.
“The steps taken in this spending review mean that by the end of the Parliament, social care spending will have risen in real terms,” he added.
Mr Osborne also set out plans to “modernise” nurse training, lifting the cap on student nurses, but replacing bursaries for nurses with loans.
He said currently over half of all applicants are turned away, and it leaves hospitals relying on agencies and overseas staff.
He said: “We’ll replace direct funding with loans for new students – so we can abolish this self-defeating cap and create up to 10,000 new training places in this Parliament.”
There will also be £600m of extra funding for mental health.
Elliot Dunster, head of research, policy and public affairs at Scope, said: “The Chancellor has recognised the urgent need for investment in our chronically underfunded social care system.
“This extra funding – alongside an extension of the Better Care Fund – will begin to address a widening social care funding gap of at least £700 million a year.
“But we have serious concerns that this won’t be sufficient, over this Parliament, to rescue our crumbling social care system.
“The system has lost more than £4.6 billion over the last five years, resulting in 400,000 fewer people receiving care.
“Social care enables disabled people to get up, get dressed and get out of the house. But right now disabled people are waiting 14 hours to go to the toilet, sleeping in their clothes, unable to eat or wash, and are left socially isolated.”
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