Written evidence submitted by UNISON (ASC0008)

Adult Social Care Reform: The Cost of Inaction

UNISON inquiry submission

Executive summary

• Adult social care has been in desperate need of fundamental reform for many years and the failure to deliver it has done immense damage to the sector.
• UNISON is a strong supporter of plans to create a National Care Service and welcomes moves to bring a Fair Pay Agreement into being as a first step.
• An obvious reform that has been lacking has been a fundamental rethink to the approach taken to funding.
• Inaction has created a direct cost to the NHS in terms of delayed discharge – and social care comes close to the top of NHS leaders’ concerns ahead of winter.
• The extra money in the Budget must be stretched across both children’s and adult social care – more generous settlements will be needed, along with a move away from a short-term “sticking plaster” approach to funding.
• Local authorities are finding a larger and larger share of their spending is taken up with adult social care, meaning that other services are being cut back.
• Underfunded care budgets mean that the system will be less likely to play its part in boosting prevention and moving care out of hospital, as per NHS 10 Year Plan goals.
• The cost of inaction has been felt severely by those in need of care – as a result unpaid carers are increasingly having to fill the gap.
• The workforce has also suffered dramatically – vacancy rates are high, along with turnover.
• Endemic low pay is a key driver of this, as is a lack of employment security.
• Migrant care workers are particularly vulnerable – UNISON has documented an increase in cases of abuse in recent months.
• Training, career structure and progression incentives are absent in much of the sector.
• The failure to produce a government-backed workforce strategy has further hindered the sector.
• A lack of reform also means that nothing has been done to tackle the fragmentation of the sector or the fragility of the adult social care market.
• A lack of consistency, oversight and stability are among the reasons UNISON backs the development of a National Care Service.
• Virtually all adult social care is now delivered outside the public sector, with private equity-backed providers playing a prominent role.
• The government has shown it is prepared to tackle profiteering in children’s social care – now the same approach should be taken to adult social care.
• Adult social care makes a sizeable contribution to the economy and reform would allow it to play an even greater role.
• Reform should be seen not purely as a cost to the exchequer, but rather as an investment in the country’s future – linked to the drive to boost economic growth.
• Reports have shown that there is a solid economic case for investing in social care.
• And specific investment in social care pay would also generate considerable savings (as demonstrated by Skills for Care’s recent work towards a workforce strategy).

Introduction

1. UNISON is the UK’s largest union, with more than 1.3 million members providing public services – in the NHS, local government, education, the police service and energy. They are employed in the public, private and voluntary sectors. UNISON is also the largest union for social care workers.

2. UNISON welcomes the fact that the new Committee’s first inquiry is on adult social care reform, and specifically that it should cover the cost of inaction. The sector has been in desperate need of fundamental reform for many years and the failure of successive governments to deliver on the promise of reform has done immense damage.

3. UNISON is a strong supporter of plans to create a National Care Service in England, having commissioned last year’s influential Support Guaranteed report from the Fabian Society.[1] As part of this, the union also welcomes the fact the new government is beginning to deliver on its manifesto pledge to produce a Fair Pay Agreement in adult social care, with the Employment Rights Bill set to make this a reality via the establishment of the Adult Social Care Negotiating Body.

4. Given media speculation about the use of a Royal Commission[2] and ministerial talk of forging a cross-party consensus on reform[3], UNISON is clear that any such process should be strictly time-limited and should proceed on the basis of how to bring about a National Care Service (rather than whether to), as the government has a clear manifesto mandate and the sector has already been waiting far too long for meaningful reform. Any such process might usefully be used to generate a national conversation on traditional obstacles to reform of the sector, such as the means test and overall funding of adult social care.[4]

5. This submission broadly follows the terms of reference laid out by the Committee (with responses to similar questions grouped together) and includes a particular focus on the workforce. We have assumed the inquiry relates to England only, though many of the issues covered below would also apply in other parts of the UK.  UNISON would welcome the chance to provide oral evidence in support of our submission.

How much is inaction on adult social care reform costing the NHS and local authorities, and what impact does this have on patients and the public?  

What NHS and local authority service reforms are not happening as a result of adult social care pressures, and what benefits are patients and the public missing out on?  

6. It is hard to quantify the exact cost to the NHS and local authorities of inaction on adult social care reform, but the costs have been substantial. Along with structural change to the adult social care market, the most important reform that has been lacking has been a fundamental rethink to the approach taken to funding.

7. The decade of austerity in the 2010s saw cuts of 55% in local authority funding, resulting in a real terms reduction in councils’ spending power of 29%.[5] These cuts have led to a number of councils declaring effective bankruptcy and they have severely hampered the delivery of adult social care, all the more so given rising demand for services in recent years (requests for support increased by 11% between 2015-16 and 2022-23[6]). Despite councils attempting to protect social care from cuts, local authority spending on social care services was lower in real terms at the end of the 2010s than it was at the start of the decade.[7]

8. Looking to the future, councils estimate that, without reform, their costs for providing care and support for working age adults will grow to reach £17bn by the end of the current decade. And if the current growth in support for this group of care recipients continues, the total cost to local authorities in England will increase by at least 50% – or £6bn more per year – by 2030.[8]

9. Inaction on adult social care reform has created a direct cost to the NHS in terms of delayed discharge. The latest State of Care report from the Care Quality Commission found that, in April this year, waits for care home beds and home-based care accounted for almost half of the delays in discharging patients who had been in hospital for more than 14 days, with nearly 4,000 people delayed on an average day.[9] Before the 2024 general election, a report from NHS England suggested that the crisis in the unreformed adult social care system was one of the key factors in effectively wiping out recent increases in NHS funding.[10] NHS leaders have identified delayed discharge and social care capacity as the two greatest threats to the provision of high quality care by the NHS over the coming winter.[11]

10. The extra £600m for social care in the recent Budget must be stretched across both adult and children’s social care. More generous funding settlements will clearly be required[12], and UNISON would urge the new government to move away from the short-term “sticking plaster” approach of the last 14 years, by providing longer-term settlements that provide greater certainty and stability for the sector.

11. The failure over the last 14 years to either reform adult social care or to invest properly in the sector means that local authorities are finding a larger and larger share of their spending taken up by social care, leaving less money available for reforming – or even delivering – other local services. Overall, adult social care now accounts for more than 40% of all local authority spending on services[13], but some councils are reportedly spending as much as 80% of their budget on care (including services for both adults and children). The direct result of this is that councils have to cut back on other important (but non-mandatory) local services, such as libraries, leisure centres and youth clubs.[14] Earlier this year, UNISON revealed that between 2010 and 2023, at least 1,243 council-run youth centres were closed and 1,168 council-run children’s centres shut. There has also been a significant decline in the number of council-run libraries (1,376 fewer) and public toilets (a drop of 1,629) over the same period.[15]

12. The impact may be less obvious in the NHS, but it is real. In reporting that more than 80% of councils expect to overspend their adult social care budgets this year, directors of adult social care have also voiced a fear that their ability to support the government’s drive to boost prevention (one of the “three shifts” that the forthcoming 10-Year Plan for the NHS will aim to bring about) will be hindered by “operational priorities and financial pressures”.[16]

13. The inability of successive governments to deliver the much-vaunted movement of care out of acute settings can be attributed in part to the failure to produce a viable set of alternative services outside hospital – which includes social care (along with NHS community services). The new government is currently seeking views to help shape its 10-Year Plan for the NHS and moving care from hospitals and into community is one of the other shifts it is focused on. UNISON would urge the government to ensure that this part of the plan has a major focus on adult social care.

What is the cost of inaction to individuals and how might people’s lives change with action on adult social care reform?  

Where in the system is the cost of inaction on adult social care reform being borne the most? 

14. The cost of inaction on adult social care reform is being felt severely by those in need of care and support, and by the workforce charged with delivering services.

15. As funding restrictions have bitten since 2010, both the means test and the needs test for receiving care have become more stringent. Despite an ageing population, the number of older people receiving state-funded care has fallen 10% since 2014-15 due to tightening eligibility criteria.[17] Age UK estimate that as many as 2 million older people now have some unmet need for social care.[18] It is not just older people that are losing out; Healthwatch have suggested that up to 1.5 million working age disabled people could also be missing out on social care support they are eligible for.[19]

16. It is estimated that by March 2024, over 400,000 people were waiting for care or for an assessment of their needs, and that more than 78,000 had been waiting over six months for a care assessment.[20] NHS England figures show that there was a fall of more than 6% in recipients of long-term social care between 2015-16 and 2021-22 (despite a 9% rise in the number of annual requests for care during this time).[21] Meanwhile, the CQC has reported that the number of new requests for local authority adult social care support that resulted in no service being provided has increased by more than a quarter over the past five years.[22]

17. The growing gap in state provision of adult social care has meant that unpaid carers are increasingly having to fill the void. There are estimated to be around 5 million unpaid carers in England and Wales[23], but there was an 11% drop in the number of unpaid carers (13,000) receiving direct support between 2015/16 and 2020/21.[24]

18. Those in need of care and support are also losing out due to the treatment of the workforce. As the Nuffield Trust and Health Foundation think tanks point out, ongoing low pay – a key feature of the unreformed adult social care system – is not only contributing to chronic staffing problems but is also “impacting the availability and quality of care for people who draw on care services.” [25]

19. Workforce shortages are a big problem in adult social care, with the current vacancy rate one of the highest in any sector of the economy[26] and more than 130,000 roles unfilled across England.[27]  The turnover rate across the sector also remains high, with around a quarter of the workforce leaving their jobs each year (around 350,000 workers).[28]

20. A key driver of the high vacancy rate in adult social care is endemic low pay. IPPR analysis for the Living Wage Foundation before the general election found that more than 400,000 adult social care workers in England were paid below the real living wage (43% of the total).[29] The most recent statistics from Skills for Care suggest that 80% of jobs in the economy pay more than average pay for care workers.[30] Research from 2022 found that over a quarter of the UK’s residential care workers lived in, or were on the brink of, poverty – and that nearly a tenth experienced food insecurity.[31]

21. Regrettably, in adult social care these headline problems on pay are frequently accompanied by wider exploitation. For example, homecare workers face a high risk of being paid less than the minimum wage once their travel time is accounted for.[32] A UNISON survey from 2023 suggests that as many as three-quarters of homecare workers are not being paid for their travel time, meaning that many employers are effectively breaking minimum wage laws. These failings are compounded by the weakness of the regulatory response: recommendations from the Low Pay Commission and the Director of Labour Market Enforcement to improve the situation were ignored by the previous government, with individual care workers expected to take responsibility for telling the HMRC if they think they are not being paid properly – but just 18% of workers in UNISON’s survey said that they had been provided with payslips that accurately detailed their time spent travelling. Since 2013 no care employer has been referred to the Crown Prosecution Service for failing to keep sufficient minimum wage records.[33] It will be important for the new government’s proposed single enforcement body, the Fair Work Agency, to get to grips with these abuses in a much more robust manner.

22. There are different problems for those working in residential care, where UNISON has repeatedly raised the alarm – including in court – about the fact that too many workers do not receive sufficient pay for doing “sleep-in” shifts at their place of work.[34] And at the most basic level, Covid-19 highlighted just how many care workers were not even able to access proper sick pay – in spite of the dangers this created for care home residents during the pandemic.[35] A 2022 survey by UNISON found that more than half of care workers employed in the private sector were receiving under £100 a week if they take time off sick, with many getting nothing at all.[36]

23. The problems for the workforce also include insecure employment, with the preponderance of zero-hours contracts skewing the power dynamic in the workplace further towards the employer. The latest statistics suggest that 21% of workers across the sector are on zero-hours contracts (340,000 people), but this figure rises much closer to half (43%) for homecare workers.[37]

24. The workforce exploitation that has become a depressingly widespread feature of the sector is amplified greatly for the large and growing number of migrant workers who now work in adult social care. In quarter 1 of 2024 (April to June), more than 60% of all reports made to the Gangmasters and Labour Abuse Authority (GLAA) were concerning labour abuse, such as debt bondage, within the UK care sector.[38] Over the past year, UNISON has repeatedly documented an increase in cases of abuse that members have reported to the union.[39] Migrant care workers are frequently trapped in inadequate housing, paid rock-bottom wages for excessive hours and locked into unfair contracts. Some have paid colossal fees to take jobs in the UK. Some say they are unable to leave a location even when they are not on shift or are told to pay back huge sums to the company when they raise concerns about their working conditions or service quality. Often this is backed with threats of deportation. Unscrupulous employers have greater powers over migrant care workers because their work visa is tied to their employment status; if they lose their job, they will lose the right to work and live in the UK unless they find another job with an eligible social care employer. UNISON members report that many employers are well aware of the fear and vulnerability migrant workers experience, and do not hesitate to use threats to secure compliance. The union is calling for visa sponsorship to be decoupled from individual employers in favour of a sector-wide sponsorship scheme.

25. Many people that work in the adult social care sector find they are unable to access the right amount or level of training to carry out their job most effectively or to further their career. A recent example of this is the finding that only 29% of care staff undertake any kind of dementia training.[40] High staff turnover rates have created a disincentive for employers to invest in staff training, as there is an expectation that many workers will move jobs within a year. There are also problems with a lack of portability where training is concerned – many workers must repeat their training when they start a new job in the sector. This costly duplication is another reason why a more coherent national system is needed for the sector.

26. Many workers also find that there is a lack of a proper career structure in place and that progression opportunities are few and far between. The fact that experienced care workers (with five or more years in the sector) are paid on average just 8p more than new starters provides little incentive for workers to remain in the sector.[41] These problems are part of a wider societal failure to accord adult social care the status it deserves, a sense that is reinforced by the fact that England remains the only part of the UK not to insist on care worker registration, perpetuating the myth that the workforce is “low-skilled”.[42]

27. The fact that the adult social care workforce is being let down on so many different levels is explained in part by the abject failure of any recent government to produce an overarching workforce strategy for the sector. Given the desperate need for a coherent approach to staffing it is astonishing that the last government workforce strategy for the sector was produced in 2009[43], all the more so since the pandemic given the variety of organisations producing templates and contributions for the government to use[44], culminating in the comprehensive work undertaken by Skills for Care, that reported in July.[45] UNISON recommends that the development of a government-backed workforce strategy should form a central part of future plans for social care reform. The union also wants to see the development of tripartite national partnership working in adult social care, which could use the successful NHS Social Partnership Forum as a model.[46]

28. The impact of inaction on service users and the workforce, as laid out above, also needs to be seen in the context of the fragmentation of the sector, the fragility of the adult social care market and the ownership status of organisations delivering services. The adult social care sector is hugely fragmented, with 1.59m people working for 18,500 organisations at 40,000 establishments – along with 67,000 people who employ their own staff.[47] There is also a wide variation in the ability of those in need of care and support to access care packages across the country[48], and the experience of working through the Covid-19 pandemic showed how hard it was for government ministers to exercise any oversight or control over what was happening in local care markets.[49] The fragility of the care provider market is another notable feature of the sector: a recent survey found that 43% of adult social care providers had closed services or handed back contracts in the last year, with 39% considering exiting the market altogether.[50] At the end of 2023 there were 518 fewer care homes in England than at the same time the previous year (a loss of 14,169 beds).[51]

29. This lack of consistency, oversight and stability are among the reasons UNISON continues to advocate the development of a National Care Service[52] – a way of bringing greater consistency and certainty to a system currently sorely lacking in either.

30. Despite the tight funding situation in adult social care, the Care Quality Commission reports that in the 2023-24 financial year there were actually “improved profit margins in older people’s care homes and in homecare providers”.[53] Yet there is evidence that both service users and staff fare worse when services are delivered by for-profit operators. The turnover rate for employees working for local authorities is just 13%, almost exactly half the rate for those in the independent sector (25.8%).[54] And recent research by Oxford University highlights concerns around quality, stability and accessibility in relation to for-profit care homes: for example, inspection ratings consistently rank public and third sector adult care homes ahead of those run by for-profit providers; involuntary closures and enforcement actions by regulators are concentrated among for-profit operators; and outsourcing is associated with inequalities in provision, as for-profit care homes attract self-funded residents in affluent areas, leaving those in deprived areas with fewer options.[55]

31. For these reasons, UNISON continues to oppose the outsourcing of social care and particularly the provision of services by profit-making companies – many of which are backed by private equity,[56] despite this ownership model being associated with billions leaking from the sector (in profit, rent and debt servicing)[57] and the buying and selling of care homes. In recent weeks one of the country’s largest care home chains, Care UK, has reportedly been sold off to an American property investment company.[58]

32. The government has shown that it is prepared to tackle profiteering in children’s social care[59], now the same approach must be taken to adult social care. In order to deliver on the new government’s manifesto pledge to bring about the “biggest wave of insourcing in a generation” work must take place to rebuild the capacity of local authorities to deliver adult social care in-house, something which has reduced dramatically over the past 20 years: 96% of residential services are now outsourced (an increase of more than 20% since 2001)[60] and just 7% of filled post in the adult social care sector are people working for local authorities.[61]

What contribution does adult social care make to the economy and HM Treasury and how might this change with action on reform?   

To what extent are the costs of inaction on adult social care reform considered by the Government when evaluating policies, including within the Budget and Spending Reviews? How should these costs be assessed and evaluated? 

33. Adult social care already makes a sizeable contribution to the UK economy, and reform of the sector would allow it to play an even greater role in supporting growth. In the last financial year, the adult social care sector contributed more than £68bn to the economy in England. The sector employs nearly 1.6 million workers, which is more than 5% of the labour market in England and a larger number than work for the NHS.[62]

34. Reform should not be seen purely as a cost to the exchequer, but rather as an investment in the country’s infrastructure and our economic future. As such, reform of adult social care could play an important role in the new government’s drive to boost economic growth.

35. A 2023 report from the Future Social Care Coalition made the economic case for investing in social care. It pointed out that for every £1 invested in social care, £1.75 is generated for the wider economy. It highlighted the significant public savings that could be made in other areas of the economy, such as those associated with a reduced welfare bill – as more people would be able to remain in the workplace – along with direct savings for the NHS by reducing delayed transfers of care. The report also pointed to the fact that investing in social care would help retain workers in the labour market who would otherwise be economically inactive because of their caring commitments or due to long-term sickness or disability[63] – the recent Darzi report on the NHS pointed out that 2.8 million people are inactive due to long-term conditions.[64]

36. Specific investment in the workforce could also generate considerable savings. In developing their recent proposals for a workforce strategy for the sector, Skills for Care included an “attract and retain” section with detailed pay modelling, as well as a separate economic analysis of policy recommendations.[65] The strategy makes high-level estimates of the likely costs and benefits (over a 15-year period) of investing in social care pay. It models three pay-related changes: increasing compliance with the National Living Wage (NLW) and paying for travel time; the production of a sector minimum wage either £1 or £2 above the NLW; and alignment with NHS pay bands. Across these various modelled changes, the analysis found there would be benefits in terms of an increase in the adult social care labour force, a reduction in staff turnover, savings to the NHS (due to the numbers of people receiving social care services and a reduction in costs due to avoided injuries), and a boost to the wellbeing of people receiving care due to the additional staff. Each of these options for boosting pay would cost money but, in addition to improving the quality and continuity of care, they would also help the government unlock potentially many billions in savings.

Submission produced by the UNISON Policy Unit

December 2024