Budget 2018: reaction from the sector

Cutbacks iStock 000013353612XSmall 146x219Local Government Lawyer looks at the sector's reaction to Philip Hammond's latest Budget.

Lord Porter, Chairman of the Local Government Association

“The Budget shows the Government has started to listen to the LGA’s call for desperately-needed investment in our under-pressure local services, but falls short of what we need in the long-term. Councils were at the front of the queue when austerity started so local services should be at the front of the queue if it is coming to an end.

“The LGA’s Budget submission highlighted the severe funding pressures facing councils in 2019/20. The Chancellor has acted to help tackle some of this immediate funding crisis with £650 million for social care which provides a financial boost for some of our local public services.

“While this funding will ease some of the immediate financial pressure facing councils and our local services, it is clear that this cannot be a one-off. Today’s funding is a start, but the real test will come in the Spending Review next year.

“Local government in England continues to face significant funding gaps and rising demand for adult social care, children’s services and homelessness support will continue to threaten other services our communities rely on, like running libraries, cleaning streets and maintaining park spaces. Councils also continue to face huge uncertainty about how they will pay for local services into the next decade and beyond.

“Investing in local government is good for the nation’s prosperity, economic growth and the overall health and wellbeing of the nation. We now look forward to working with the Government to ensure the forthcoming Spending Review delivers a truly sustainable funding settlement for local government, and its adult social care Green Paper puts social care on a firmer, long-term financial footing for the people who depend on care and support.”

Glen Garrod, President of the Association of Directors of Adult Social Services (ADASS)

“It’s positive to see a step in the right direction in today’s budget – the additional £650 million for social care will provide necessary support to older and disabled people and their families, care workers, providers and the NHS. However, this is still far short of the £2.35 billion that ADASS identified would be needed for social care to stand still in 2019/20; councils have been struggling with funding shortfalls for years.

“It is also encouraging to see the funding for mental health crisis services, which are vital, come from the £20 billion funding already announced for the NHS. The £45 million for the disabled facilities grant will also enable more people to live independently, with home adaptations enabling them to live in their own homes for as long as possible.

“It is important to remember that social care is accounting for over 40 per cent of council budgets, whilst still not meeting all the needs of the community. With rising need and increasing complexity, the demand for care and support services is only going to increase.

“This budget has failed to provide the long-term funding solution that social care desperately needs – and whilst the extra investment is welcome, the need for that long-term approach has never been more urgent. Yet again, the Government has made promises of the green paper on social care coming soon; yet again, it has failed to materialise.

“The green paper now must become an urgent priority if we are to ensure that older people and adults with disabilities who live in our communities get the essential, person-centred care they need that can truly transform live. The time for sticking plasters is over – we now need to see a serious commitment towards making social care sustainable.”

Paul Dossett, Head of Local Government, Grant Thornton UK LLP

“The Chancellor took the opportunity offered by improved public finances to direct spending at a number of public services. But instead of meaningful long term preventative solutions, we were offered a large number of short term solutions with no clear commitment to future sustainability.

“The proposed changes to Universal Credit will offer short term support to “at risk” claimants but this is merely a holding measure. The root causes of the issues with the system remain and have just been kicked further down the road. If the narrative that Universal Credit is damaging to families continues to be proven, the changes could feedback negatively and result in additional costs for councils in the need for adults and children’s social care.

“The £650m for adult social care in 2019/20 is a welcome recognition of the increasing demand and growing funding crisis in this area. It is even more welcome that this money appears to be grant funding as opposed to council tax, which would have only widened the current inequality seen in the distribution of funds. But demand for this service means that this cost will continue every year for at least a decade. So while this funding may allow a year’s relief, the upcoming Green Paper and Spending Review need to resolve the longer term policy and tax issues at root or we risk seeing services collapse.

“It was a surprise not to see additional grants for children’s services given the recent increase in demand, which now surpasses that of adult social care. With 81% of councils with a responsibility for social care overspending on their children’s services budget in 2016/17, this was a missed opportunity for government to provide much needed support to struggling councils.

“The extra boost for mental health services was another indication of a “sticking plaster” mentality – rather than an investment in prevention. Most measures proposed, like mental health ambulances and more support for A&E departments seem to frame spending on crisis and high acuity. Many mental health experts regard crisis support as important, but earlier help even more critical.

“It is clear that local public services have declined, with potholes as a symbol which resonates with the public, and while emergency funding has been provided and is welcomed, it is not a panacea. With only short term holding measures introduced today, the Spending Review 2019 will now be heavily scrutinised to see whether it passes the long term sustainability test.”

Stuart Gallimore, President of the Association of Directors of Children’s Services

“A decade of austerity has impacted on children and families, increasing demand for our help – any move away from this policy is a good thing but it is far from ‘over’.

“The Chancellor announced £410 million for social care in 2019/20, with no further detail about how this will be shared or allocated. Whilst any additional funding is to be welcomed, we need five times this amount just to plug the funding gap expected in children’s services by 2020. For children’s social care, the Chancellor announced 20 local authorities will share £84 million over five years, we would be keen to understand how this will be used to support the funding gap which exists across the sector as a whole. We are becoming increasingly concerned at the government’s piecemeal approach to funding children’s services. Ad hoc, time limited pots of funding for some local areas and not others falls woefully short of the sustainable and equitable long term investment in children and young people that is required to ensure high quality, safe services are available for them at the earliest opportunity. Today, the EIF published a report which states that small, short-term, single pots of funding from government are unhelpful compared to the benefits of long term strategic funding.

“Just like local authorities’ schools are also facing growing funding pressures. The one off capital payment of £400 million for equipment and buildings, less than that for potholes, will not solve some of the long term issues we see in our schools. Moreover, some of the language used by the Chancellor shows a failure to understand the extent of these pressures. Failing to invest in children and their education is a false economy, the government must recognise this in time for next year’s spending review.

“The additional funding for Universal Credit will go some way towards helping families claiming benefits but key issues, such as delays to payments and sanctions, placing further strain on vulnerable families who are already struggling with their most basic needs, remain unaddressed. In communities where Universal Credit has been rolled out, the Trussell Trust reports that referral rates to foodbanks more than doubled the national average. A system aimed at supporting vulnerable children and families should not push them into destitution and poverty.”

“The Chancellor also announced funding for a range of crisis services to support children and young people’s mental health. Whilst this is welcome, to achieve ‘parity of esteem’ between mental and physical health services much more must be spent much earlier on services that support children’s emotional health and well being. Without this it is unlikely that the child and adolescent mental health system will be transformed in the way that vulnerable children so rightly need and deserve.”

Dr Jonathan Carr-West, Chief Executive of think tank LGiU

"Pots of money for potholes, social care taken off life support and high spending on the high street. Has the Chancellor saved local government? Or are councils being given hush money to quit complaining while we continue to mask the serious structural problems that have led to hundreds more newborn babies being put into care while elderly people are refused it. Instead of giving councils ring-fenced pocket money the government needs to engage with the systemic funding problems in local government, find a locally responsive way of integrating health and social care and initiate a genuine conversation about how we fund local services.

"Local government finances are in such a desperate state that any additional money will help, of course, but attempting to plug the holes in the dam with specified pots of money from Whitehall is a cause of the problems local government faces not a cure for them.

"The Chancellor’s room for manoeuvre in this final pre-Brexit budget was always going to be limited but, despite the declaration that austerity is coming to an end, what we see today is a government waking up to the crisis in local services but with no idea what to do about it."

Jonathan Werran, chief executive of the Localis think tank

“From a place perspective, today’s Budget acknowledged the contribution local government has made to historic deficit-reduction and managed to hit some of the key notes for local prosperity and wellbeing at the level of connectivity, community and care.

“Significant multi-billion pound funding announcements on roads infrastructure, an ambitious £675m pot to engineer the survival of our imperilled high streets and a solid £650m slug of cash for social care - to keep precarious council finances and services just about managing for another year - are the clear highlights.

“But if ending austerity also means ensuring real wage growth, then looking beyond the Northern Powerhouse and Midlands Engine, a moribund devolution agenda has to be reinvigorated so all regions of England can benefit from attempts to boost productivity levels through improving skills and infrastructure provision.”