ARC says King’s Fund report on social care fees is flawed

ARC England, an umbrella body representing service providers in the learning disability and autism sector, is seeking a correction from the King’s Fund after its recent social care report said councils successfully reflected the costs of providing care and support to adults of working age in the fee rates.

It says that The Social Care 360 report makes an important point about successive governments’ failure to consider the impact on the social care sector of recent increases in the National Minimum Wage (NMW)/National Living Wage (NLW). 

Yet, researchers did not draw a comparison between the 13% uplift it claims councils have applied to the services working-age adults rely on during the period 2015/16 to 2023/24 and the increase in the National Living Wage those providers were required to pay during that period.  

ARC said that if NLW was subtracted as it was in 2016 (£7.20) from the rate applicable in 2024 (£11) and divided by the 2016 value (£7.20), it could be seen “that over the period during which it is claimed that fees increased by 13%, providers were also required to meet an increase in the NLW of 52.78%.”

It added: “The financial reality of the situation facing providers starts to bring into question the positive tone of the report, but we think it gets worse. 

“Without quoting actual fee rate uplifts offered to providers of externally commissioned services (we know that councils pay themselves much higher rates to deliver the services they expect external providers to survive on), the Kings Fund piece, underpinned by flawed logic and incorrect assumptions, moves seamlessly between using the Market Sustainability and Improvement Fund (MSIF) data to describe the numbers of people receiving support and the amounts councils are paying for social care, and the fee rates being paid to providers.”  

ARC says King’s Fund logic is flawed

ARC says the logic is flawed for a number of reasons: 

• We know that new packages are often commissioned at rates which are closer to what they cost to deliver than existing care and support packages, which are rarely brought into line with newer packages. If this is a reason for the disparity, should we be telling our members that they ought to give notice so that councils will retender the work at rates that are sustainable?  

• We know that councils are commissioning more social care, so budgets have increased. Of course, this does not mean that providers delivering existing services are being paid properly for their work. The report appears to conflate increased budgets (due to councils commissioning more work) with the fee rate increases they provide for existing externally commissioned services.  

• We believe that there may be errors in the MSIF data in relation to packages for which the costs for Funded Nursing Care have not been removed, which would artificially inflate the costs being met by councils. Similarly, where councils commission on behalf of an Integrated Care Board, might some Continuing Healthcare (CHC) costs have been included in the figures, which would also give a false impression of actual council costs? (We note that the report states that gross current expenditure numbers used do not include spending that arises from NHS income so this might mean that these costs are not in fact included). 

• We also wonder whether the MSIF data might also include full cost recovery clients for people who may not have an eligible need, and also local authority collected top ups from self-funders which are also outside eligible need? 

It added that analysis by ARC England last year, which was endorsed by Care Cubed, a leading provider of care cost modelling tools, showed that just to meet the additional costs announced in the Autumn 2023 budget (so excluding inflation), fee rates would need to be uplifted by a minimum of 12% purely to enable providers to stand still. 

The data collected for the ARC England Learning Disability and Autism Research Unit which is based on Freedom of Information Requests sent to every local authority in England and Wales confirms that the average uplifts by service type actually offered for this financial year were: 

• Residential: 8.67%  

• Supported Living: 8.51%  

• Day Services: 7.39%  

• Domiciliary: 9.2%  

It added: “The Kings Fund report says that expenditure is not a perfect proxy for the amount and quality of care arranged by local authorities and we would agree with this. 

“To use it as a means to present a report which purports to describe fee rate uplifts is either a gross error of judgement on the part of the Kings Fund or an attempt to support the government in its attempts to whitewash over the funding crisis that threatens to irreparably damage the learning disability and autism services sector.  

“Either way, ARC England and its members won’t be gas lit by this misinformation because we live with the reality of year after year of underfunding as it affects services, supported people and their families.”

Alison Bloomer

Alison Bloomer is Editor of Learning Disability Today. She has over 25 years of experience writing for medical journals and trade publications. Subjects include healthcare, pharmaceuticals, disability, insurance, stock market and emerging technologies. She is also a mother to a gorgeous 13-year-old boy who has a learning disability.

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