INDEPENDENT FUNDING REVIEW OF FREE PERSONAL AND NURSING CARE: MEETING AT 10.00am ON THURSDAY 14 FEBRUARY 2008, ST ANDREW'S HOUSE: NOTE OF MEETING
Present: Lord Sutherland (Chairman)
Anne Jarvie
Mary Marshall
Jim Dickie
Professor David Bell
Rory Mair
Rhona Dubery (Secretary)
In Attendance: Neil Rennick, Scottish Government: Community Care Division
Shaun Eales, Scottish Government: Community Care Division
Jenny Stevenson, Scottish Government: Community Care Division
Daniel Hinze, Scottish Government: Health Analytical Services
Julie Rintoul, Scottish Government: Health Analytical Services
Introductory Remarks
1. Lord Sutherland welcomed members to the seventh meeting of the Review Group and thanked Julie Rintoul and Daniel Hinze, of the Health Directorate's Analytical Services Team for joining the Group to assist with the discussion on the expenditure figures and costs for FPNC. He noted that there were 2 papers/additional pieces of information being tabled. First, Jim had provided a paper on extra care housing, which was not for discussion at the meeting but had been prepared to provide an up-to-date view on housing relevant to the consideration of overall costs of care. Second, Daniel had prepared additional illustrative graphs profiling the costs of care relevant to the discussion on cost projections at item 5 of the agenda.
Minutes of Meeting held on 18 January 2008
2. The minutes of the sixth meeting held on Friday, 18 January 2008 (IFR-FPNC (08)1st Minutes) were approved.
Audit Scotland Review: Local Authorities' Expenditure Figures (Paper IFR-FPNC(08)05)
3. Rhona said that Paper IFR-FPNC(08)05 offered an up-date on the latest position with the Audit Scotland Review of FPNC which published on 1 February 2008. She said that Neil would explain the work he was undertaking to investigate further with Audit Scotland and local authorities the basis of the revised expenditure figures in more detail. She said that the Audit Scotland Project Team had offered to meet with the Review Group again if a more detailed explanation of how their figures were determined or of any other aspect of the Audit Scotland report would be helpful.
4. Neil said that further discussions had taken place between the Audit Scotland Project team and officials regarding the detail behind the revised expenditure figures and suggested shortfall figure of between £46 m and £63 m for 2005-06; as paper (Paper IFR-FPNC(08)05) indicated, even the lower of the 2 Audit Scotland's shortfall estimates was much higher than the SOLACE, CIPFA, ADSW working group figure of £26 million submitted to the Review Group in evidence in January. It was very close to the figure that the Care Costs Sub-Group had come to. The exercise with Audit Scotland had highlighted a number of anomalies with the data. A more extreme example was the inclusion of Supporting People expenditure in the return for one council.
5. Neil said he thought that a meeting between Audit Scotland and representatives of the SOLACE, CIPFA, ADSW working group may be arranged in a bid to get under the skin of the expenditure figures and see how the gap between the 2 estimates could be explained. The Audit Scotland report highlighted the wide variations in local authorities' practices in terms of reporting costs and overheads relating to FPNC. In terms of overheads alone a number of councils were unable to estimate these costs and this had led to Audit Scotland producing an average overheads figure of 12% which was added to their expenditure totals as a notional overheads figure where councils were unable to estimate their own overhead costs. In monetary terms, that had added around £30 million to the overall costs figure. The problem of inconsistency in local authorities' monitoring of FPNC costs and the different practices which made it difficult to define the costs which were directly attributable to FPNC was widely acknowledged. The differences in accounting practice across Scotland were inevitable but work to improve the situation on reporting was one of the key recommendations for SG and Local authorities in Audit Scotland's report. He advised that some early meetings were being scheduled with local authorities to look at their reporting of costs and overheads in their national financial returns.
6. Charging for food preparation continued to be a key area of concern to councils, with 8 Councils interpreting the legislation differently to the other 24 and continuing to charge for the service. The local authorities were keen to see early action to clarify the legislation on this front. If and when a return to the legislation was recommended to resolve the food preparation issues then the cost of retrospective payments would need to be considered.
7. The Review Group noted:
(a) The Audit Scotland offer to meet with them again but were content for Neil to liaise with the project Team further and report back to the 29 February meeting;
(b) The need to bear in mind the costs of any retrospective payments in respect of food preparation in its final recommendations;
(c) Audit Scotland's "best estimate" figures on costs and on the potential shortfall in funding and its failure to come to a single definitive figure, despite its efforts with councils to correct errors and apply overheads consistently; and
(d) That the Audit Scotland position on potential shortfall left the Review Group in a difficult situation. Its remit looked to it to come to an authoritative view on the adequacy of the total level of resources for the policy and on the level of resources required to address any funding gap to sustain the policy for the long-term. However, it was constrained in that task by continuing limitations in the available financial information on costs and in the circumstances it looked very likely that a degree of pragmatism would be required in quantifying any funding gap.
8. The Review Group agreed that it would return to the question of potential shortfall in the total resources for the FPNC policy and the level of resources required to stabilise it in the long-term at its next meeting on 29 February.
Funding of the Policy: Up-date of Paper IFR-FPNC(08)02 on the Total Cost of Care Provision for Older People in Scotland
9. David said that as promised he had done some further work in verifying the figures in the paper considered at the last meeting on the total funding going into long-term care for older people in Scotland. This revise of the paper took on board comments offered by government statisticians, including the suggestion that the paper needed to look at the overall picture for a single financial year. On that basis it was necessary to use 2005-06 as the figures for FPNC as expenditure data was not yet available for 2006-07.
10. David said that the paper was an attempt to look at the global costs of long term care and that it took a step further than the Range & Capacity Review as it included direct spending by the UK Government in support of long-term care needs in Scotland. This principally arose from DWP payments on Attendance Allowance and the care component of Disability Living Allowance. The payments were explicitly intended to compensate those with personal care needs and so should be included as part of the overall long-term care costs for Scotland. He said that the total cost of long-term care in 2005-06 amounted to £2.3 billion. To put that in context, it amounted to approximately 25% of the NHS Scotland budget or about 1.4% of Scottish GDP. However, those figures were expected to rise considerably with the demographics and in the work on long-term projections he was doing the costs looked likely to rise to account for about 2.7% of Scottish GDP by 2031.
11. David talked the Group through the up-dated figures in Table 2 of his paper which set out the estimates of the component costs of spending on long term care in Scotland in 2005-06, of which FPNC was a relatively small component part. He drew particular attention to:
¨ Private Spending. The further work had brought the figure on private spending on care to around £374 million or just over 16% of the long-term costs of care. That was made up in about £129 million from self-funders' contributions towards care home fees; £164 million in local authority client contributions towards care home fees; £34 million in privately purchased home care; and £47 million in local authority fees and charges. It was notable that despite the introduction of FPNC private contributions had increased since 2001, with older people as a client group making a considerable contribution to their care costs. The rise in home ownership would of course see the numbers of self-funders increase in the future.
Local authorities received income from sources other than the direct fees and charges taken into account but these incomes streams were difficult to assign ; and
¨ Relative Contributions. Getting at the relative contributions to care costs had proved challenging however it was important to factor in all funding streams if the Group was to consider the bigger picture in seeking to consider how state support might best be prioritised to make for better outcomes. It also allowed some comparison to be made with the situation in England and would help establish an agreed baseline to allow projected costs to be taken forward.
12. In discussion the following points were made:
(a) There was an element of double counting is some of the figures, such as those relating to NHS Resource Transfer where gross figures had been used. Net expenditure figures should be used and SG analytical services could help establish those;
(b) The sustainability of the resource transfer mechanism between the NHS and local authorities was questioned, with arrangements carrying widely across the country. The momentum towards establishing pooled or aligned budgets was thought to be picking up but clearly further progress in joint working would be important if limited resources were to be further stretched as demand grew; and
(c) In applying the demographics and projecting forward the costs there came a point beyond which is became difficult to sustain state support as it currently carved up. In considering the options on how the quantum of resources for long-term care might otherwise be allocated there were 2 distinct population sets to consider: Those with very expensive care packages and those that required a moderate level of care. As noted before, around 10% of the client group was accounting for about 40% of the costs. One option to consider in terms of possible re-alignment would be to redirect Attendance Allowance from those at home. Around £370 million was being paid out in Attendance Allowance to 130,000 people in Scotland. 40,000 were getting both Attendance Allowance and FPC at home, however the remaining 90,000 only received Attendance Allowance and it was not clear that this money was spent on meeting care needs.
13. The Review Group noted the revised work on the total cost of care provision and that David planned a few final checks to individual figures. Thereafter, the work would be quickly finalised to be reflected in the Group's conclusions. ( Action: David)
Cost Projections: Modelling the Future Cost of FPNC based on the latest Demographic Projections
14. David said that with a view to building on the work on total costs of long-term care and thinking towards a final piece of work on projecting the future costs, he had been looking at the demographics based on the GROs latest projections for 2006. His intention would be to further develop this work to consider the evolution of total long-term care costs to 2031 for consideration at the next meeting, including the implications for the SG and for local authorities.
15. Daniel had also produced some illustrative graphs on the number of care clients and costs of care projected to 2031 and he explained what each graph represented. Neil said that the table on the total cost 2006 based projections was probably the most important as this took the current spend and projected it forward. However, it had been compiled on the basis of "no change" and other factors would need to be factored in, such as labour costs and workforce issues.
16. In discussion the following points were made:
(a) There were a number of areas of uncertainty associated with the future costs of long-term care and the Review Group would need to consider if and how to take account of these in its care cost projections. They included healthy life expectancy, up-and-coming groups of people who might impact (such as people with learning disabilities who were surviving into old age because of advances in medical science who may not need medical care but would need social care), the future balance of care and the labour and other costs applied. The Group would need to come to a firm view as to what account it would take of these uncertainties; and
(b) It would be important to remember that in drawing final conclusions on costs and sustainability and framing recommendations there were really 2 policies to consider in terms of free "nursing" care and free "personal" care, which presented different policy choices.
17. The Review Group noted the work on future costs projections which David was progressing and the tables which Daniel had produced. The Review Group agreed that David should finalise it with a view to the Group considering the final picture and the implications for sustainability of the policy at its next meeting on 29 February. ( Action: David)
[ Julie Rintoul and Daniel Hinze left the meeting]
Brief Up-date on Report on the Views of Social Workers Undertaking Assessment and Care Management with Older People: (Paper IFR-FPNC(08)08)
18. Mary said that since the last meeting of the Review Group, when they had reported on their study on the views of social workers undertaking assessment and care management with older people, she had managed along with Jim to secure an additional meeting with Social Workers in a local authority area they had been keen to visit in order to present a more geographically balanced overall picture on the views of front-line social workers' views and experience. Jim said that the local authority in question was experiencing a period of turbulence due to restructuring of local teams, new service eligibility criteria and a new charging regime for services. The change had been the subject of much bad press but had to be viewed against a history of a low or no charge regime in the area and was probably particularly badly felt for that reason. However, the situation was adding to general problems of mis-understanding over the definition of free personal care and of what support for long-term care of the elderly was available.
19. Overall the conclusions from the additional interviews were largely consistent with those drawn in paper IFR-FPNC(08)04; with interviewees unanimous in their support of the FPNC policy for reasons of equity and fairness and highlighting the need for greater clarity and consistency across the country in the definition of what constitutes free personal care and how the policy was applied. The Review Group noted the up-date and final conclusions from the study.
Paper for Information: The Commission for Social Care Inspection's Annual Report on The State of Social Care in England 2006-07 (Paper IFR-FPNC(08)07)
20. Rhona said that she thought it would be useful for the Group to have a note of the key recommendations in the recent report from the Commission for Social Care on The State of Social Care in England 2006-07. Many of the key findings were consistent with the evidence the Review Group had heard over the past few months, including that from the Chief Social Work Inspector, Alexis Jay in her oral evidence to the Group's December meeting.
21. She said that the key findings of particular relevance included those on the use of eligibility criteria. The Commission reported all councils in England to be developing tighter rules and procedural guidelines in respect to eligibility criteria, regardless of the banding adopted locally and were increasingly attempting to narrowly define the "core business" of adult social care. It also reported councils as increasingly helping only those assessed as falling within the top 2 bands of the English eligibility framework, i.e. "critical" and "substantial".
22. In discussion the following points were made:
(a) Although there was no national eligibility framework in place in Scotland, typically local authorities had 3 or 4 levels of priority into which they placed clients referrals. There was evidence to suggest the raising of thresholds to manage demand and prioritise services in Scotland too; yet tightening of eligibility bands was neither appropriate nor effective, it did not curb demand for support and it failed to save money in the long-term;
(b) The changing demographics were obviously one factor pushing up demand for services and the picture varied widely across the country, with some particular "hot spots". However, there were other factors at play, including the policy interventions to shift the balance of care and address bed blocking;
(c) The difference in the level of complaints received by the Ombudsman in England compared to those received in Scotland was significant and should be kept in mind; the "temperature" in terms of public disquiet was considerably higher south of the border;
(d) Any attempt to address the variable use of "eligibility" criteria and so called "post code lottery" across the country would need to avoid any overly prescriptive definition of "National Entitlement" which did not fit with the "mainstreaming of FPNC with other services for long-term care of the elderly;
(e) The differences in practices and performance in delivery of FPNC services across local authorities largely came down to good practice, good management and planning and wise choices in terms of resource allocation. It was the general view though that no matter how well a local authority had performed to-date, the demographics were such that with the current level of resources available the policy was not sustainable in the longer-term; and
(f) Capacity planning was becoming increasingly important and although it went on to various degrees of sophistication in all 32 councils, better planning at a national level was desirable. It was something the ESRC had an interest in and the SG might look to having the Council do some work in that respect to improve planning at a national level, given the increasing importance of getting this right as the demographics impact on resources; and
(g) Under current arrangements, the potential was there for situations to arise where very expensive home care packages were put in place for people assessed as "critical" but who could afford to contribute to the cost of their own care, whilst denying care to poorer people who were assessed at a lower threshold.
23. The Review Group noted the paper and agreed that a number of the issues raised would need to be addressed and included in the key recommendations. David suggested that the Economic and Social Research Council (ESRC) would be well placed to do some work on capacity planning at a national level in conjunction with local authorities and NHS Scotland.
Draft Report: Key Recommendations
24. Lord Sutherland invited the Group's comments on the first draft outline of the Group's Key Recommendations that Rhona had prepared. Rhona said that the draft tabled was very much a first attempt at pulling together the conclusions from the Group's discussions over the past 5 months. The key recommendations were currently presented as the Review Group's 12 point plan to stabilise the policy.
25. In discussion a number of detailed points were offered by the Group and in addition the following key points were made:
(a) Recommendation 1: Despite the difficulties in doing so, the Review Group would be expected to offer a view on the size of any shortfall and the level of any additional funding needed to stabilise the policy for the longer-term;
(b) Recommendation 2: Agreed that the fixed rate payments for personal and nursing care in care homes should be re-based;
(c) Recommendation 3: This should be dropped because of the possible affect it might have in preventing older people from seeking the services or support they needed;
(d) Recommendation 4: Agreed that in view of the demographics and in particular the uncertainties in projecting longer-term demand, the costs of long-term care needed to be reviewed and re-modelled on a regular basis;
(e) Recommendation 5: In recommending that fixed rate payments for personal and nursing care in care homes needed to be uplifted annually in future, in line with inflation, there was a need to avoid being overly prescriptive. That said, the Group should suggest which price index should be used for up-rating. Care should to be taken around the use of ambiguous terms such as 'true cost of care';
(f) Recommendation 6: Agreed that the term 'National minimum standard' was not ideal and alternative wording should be considered. The Group needed to think further about what precisely it was aiming to do here and whether it was talking the language of "common expectation" or "rights" in seeking to address the problems of variability;
(g) Recommendation 7: It was unfortunate that the 15 high level National Outcomes set out in the Concordat with local government did not include one more precisely aimed at the needs of older people; although it was recognised that 2 of the 45 National Indicators and Targets that lay below the National Outcomes were of particular relevance. The need for the Single Outcome Agreements (currently being developed by each local authority) to include indicators which adequately reflected the needs of older people would be vital.
Independent Funding Review of Free Personal & Nursing Care
Secretariat
25 February 2008