Rising social care staff costs are leading to a reduced number of people receiving support, according to new analysis from the King’s Fund.
Social care provides vital support to hundreds of thousands of people, including those with a learning disability, across the country. Yet the report, Social Care 360, revealed a ‘doom loop’ of rising wages, increasing fees, stretched budgets, and falling provision.
Researchers analysed nearly a decade’s worth of data and found that local authorities, which fund most social care in England, have been forced to pay much higher fees for care because the introduction of the National Living Wage in 2016 has pushed up the cost of providing it.
The increase in National Insurance contributions that the government announced in the Autumn Budget is also contributing to financial problems. Care providers also fear that a planned ‘fair pay agreement’ in social care, while welcome, will further increase costs unless it is fully funded.
Simon Bottery, Senior Fellow at The King’s Fund and lead report author, said: “The increase in the minimum wage has been richly deserved by care workers but hasn’t been fully funded by government. As a result, we have seen a ‘doom loop’ in which social care providers have sought large fee increases from local authorities, which in turn have had to cut the number of people they support to make ends meet.
“Now, just as that situation was starting to improve, it runs the risk of worsening again because of the big increase in staffing costs stemming from the rise in employers’ National Insurance contributions, which has hit social care particularly hard. Unless the government makes sure local authorities have enough money, there is a real risk that even more people who need care will have to go without.”
The new analysis shows that although councils spent more on care, the number of people they could afford to support with long-term care actually fell from 873,000 in 2015/16 to 859,000 in 2023/24. The fall was driven by a 4.8% reduction in support for older people, from 587,000 to 559,000.
The report also found that requests for support continued to rise in 2023/24, reaching 2.1 million. The highest increase was among working-age adults, which rose 8% to 658,000. Requests from older people rose 3% to 1.43 million.
Care worker vacancies also fell to 8.3% in 2023/24, driven by a large increase in the number of overseas staff. Between March 2022 and March 2024, around 185,000 people started direct care roles after arriving from abroad.
The King’s Fund is now urging the government to have the political will to implement the solutions set out in the analysis instead of waiting on the independent commission by Baroness Louise Casey, which will not fully report until 2028.
Mencap said that the report, which underlines years of neglect of the social care system, is a scary reminder of its dire state and gives us a bleak forecast for the future.
Jon Sparkes, OBE, Chief Executive at learning disability charity Mencap, added: “It’s hugely worrying to hear that so many people are going without the support they need – everyone who needs social care should get it. Social care is the top reason why people contact our helpline, with many people struggling to find support and having problems with the care they receive.
“We know all too well what’s at stake. Care providers are under enormous pressure to absorb long-overdue minimum wage increases and the rise in National Insurance contributions in a sector that is already severely underfunded.
“Long-term promised reform is needed, but, in the meantime, the upcoming Spending Review must provide adequate funding for social care. The dedicated people who work in care, and the people with a learning disability who they support, deserve this security.”
