Fiscal Policy and Tax

The National Care Service – an evolving beast but will the funding feed its appetite?

It’s not every day that “the most significant public service reform since the creation of the National Health Service” comes along. Those words came from the First Minister’s speech at the launch of the Programme for Government (PfG) on the 7th September.

The scope of the National Care Service has got larger over time, with proposals currently out for consultation. There were some announcements in last week’s Programme for Government that repeat manifesto promises about initial additional funding for social care. We also now know that there will be more money flung Scotland’s way from the UK Government’s decision to raise National Insurance to provide more funding for health and social care in England.

We thought it was time to revisit the issue, and set out what we currently know about this “most significant” of reforms.

So what is the National Care Service?

As explained in this briefing put together before the election, the National Care Service was a recommendation of the independent “Feeley Review” of adult social care which reported in February 2021 [i]. In August 2021, the Scottish Government released its consultation on what it proposed the service to provide, with a few surprises held within.

As expected, there were many of the Feeley review recommendations, for example on centralising accountability for adult social care and national bargaining for those working in the adult social care sector.

Less expected was the expanding of the scope to include child social care and social work. As well as care services for children with additional support needs such as a learning disability, the consultation also brought the services that work with looked after children in scope.

Note that the social work system for looked after children was the focus of the Independent Care Review that completed a few years ago which resulted in The Promise[ii]: the actions which the government committed to are still underway. The extent to which it is intended that the National Care Service will integrate with that work, or jettison some of it, is unclear.

Other proposed additions to the expected scope of the National Care Service include justice social work services, alcohol and drug services, some elements of mental health services and GP contracts.

These proposals are all currently out to consultation[iii]. Theoretically, proposals could be dropped and the scope reduced off the back of comments to this consultation.  COSLA have already been vocal in their opposition to the wider scope[iv] (indeed they were critical of many of the recommendations of the Feeley Review as well[v]).

The legislative process also opens up chances for amendments. However, given the parliamentary mathematics (presupposing the support of the Greens) the Scottish Government could push through the proposals as they stand if they feel strongly that the current proposals are the right ones.

Why is this happening and why now?

There is no doubt that there are long standing issues with the operation of the social care system, many of which have been particularly laid bare by the pandemic.

Our work on adults with learning disabilities and the social care sector, published earlier this year, was clear in its finding that the system that delivers social care and support for adults with learning disabilities in Scotland is not doing enough to enable people to live safe, secure and fulfilling lives. There have in the past been new initiatives to better align health and social care, give people more control over the care they receive and many plans and reports that spell out how different levels of government and frontline services will do better.

The intention has long been there, but our research found that increasingly the money is not. The process of realising aims of any system, however significant and groundbreaking, will always be undermined if the resources do not meet the rhetoric.

Investment in social care is about responding to need today, but also about preventing additional need (and spend) building in the future.  People who draw on social care support often need to do so for their whole life. If they don’t get the required support now, this stores up issues for the future in terms of their health and wellbeing that may require crisis support that is likely to be much more costly to the public purse than providing the right care earlier.

Show me the money

Until we know the final shape of the National Care Service, we can’t say too much about the funding settlement required. As ever, there are likely to be difficult choices to be made.

The UK Government announcement on increasing National Insurance Contributions, with that money hypothecated into devolved health budgets, will provide fiscal room in the Scottish budget for increased spending in the health and social care area.

As pointed out by the IFS[vi], the Scottish Government does have the choice of taking out an equivalent amount from the health budget and spending it elsewhere. It is highly unlikely this will happen, but with huge challenges facing the NHS from Covid care and related backlogs, how much will filter through to social care functions is more uncertain.

However, there are increases on the way. The PfG promised “as a minimum we will increase public investment in social care by 25% over this Parliament – providing over £800 million more by 2026‑27”.

Although not clear in the PfG, we understand that this will be an additional per annum figure by the end of the parliament. Their exact definition of social care that the 25% increase relates to is a little hard to follow, and whether the £800m is a cash or real terms increase is not made explicit (we assume it’s the former).

Legislation is promised by July 2022, when we would expect a detailed financial memorandum that sets out associated spending required in more detail. The new National Care Service, especially given its widened scope, may require more additional funding than what has so far been laid out.

We hope that a clear, transparent, assessment of financial requirements, that meets with consensus from those who know, work for and draw on these services, emerges.

An underfunded National Care Service is unlikely to do any better than the system that it seeks to replace.










Emma Congreve is a Principal Knowledge Exchange Fellow and Deputy Director at the Fraser of Allander Institute. Emma's work at the Institute is focussed on policy analysis, covering a wide range of areas of social and economic policy.  Emma is an experienced economist and has previously held roles as a senior economist at the Joseph Rowntree Foundation and as an economic adviser within the Scottish Government.