Agenda item

Cabinet Member: Adult Social Care

Forward Plan Ref: 2016/042

Contact: Andrew Colling, Lead for Quality & Contracts (Joint Commissioning) Tel: (01865) 323682

Report by Deputy Director – Joint Commissioning (CA10).

The National Living Wage came into force in April 2016 and the first premium was set at £0.50 per hour bringing the total National Living Wage to a level of £7.20 per hour.  The premium is over and above the National Minimum Wage which remains in place for those workers between the ages of 18 and 25 years of age.

In November 2015 the Chancellor of the Exchequer announced the outcome of the Spending Review. This included provision for increased income generation through an additional council tax precept for the purpose of supporting adult social care costs including the National Living Wage. The Department for Communities and Local Government subsequently noted that this was also in recognition of demographic changes which are leading to growing demand for adult social care, which is increasing pressure on council budgets.

In February 2016 the county council approved an additional 2.0% council tax precept for 2016/17. This generated £5.883m to support the costs of adult social care in Oxfordshire, including the impact of the implementation of the National Living Wage from 1 April 2016.  In addition a further £0.600m was agreed to be added to the budget to support the impact of the National Living Wage on the cost of sleep-in care. This supports service users, primarily with learning disabilities, through the night - time period.

Some of the Adult Social Care Precept has already been used to reflect the direct impact of the National Living Wage and other agreed cost pressures on providers in 2016/17.  Through those decisions £0.857m of the £5.883m has already been committed leaving  £5.026m to allocate.

The impact of the National Living Wage is not known either nationally or locally. In view of this the council asked officers to undertake further work in this area to establish its impact. 

This report describes our subsequent discussion with care providers and the consultation exercise we have taken on the use of the funding available. It concludes with recommendations about how the £5.026m should be used within Adult Social Care and notes the availability of the £0.600m funding to support sleep - in care.

Considering the evidence received in conjunction with the pressures already apparent in 2016/17, Cabinet are RECOMMENDED to:

(a)       agree that the assumed hourly rate for home support workers funded through the council’s home support model should be increased from £7.20 per hour to the Skills for Care rate for Oxfordshire of £8.59 per hour.  £1.062m of the Adult Social Care Precept should be added the council’s contribution to the Older People’s Pooled Budget to fund the cost of additional payments to home support providers resulting from the increase to the hourly rate.

(b)       agree that £0.964m of the Adult Social Care Precept should be held as a contingency to support specific in-year pressures raised by providers between October and March 2017. The expectation is that this will be relevant in a limited number of cases where a provider has a longstanding contract and have not otherwise received an increase in their payment rates for a number of years.  Any allocation will need to be evidenced through open-book accounting and agreed on an exceptional basis.   Any balance remaining at year end will be used to support further pressures in adult social care evident by 31 March 2017.

(c)        agree that £3.000m of the Adult Social Care Precept should be used to increase the council’s contribution to the Older People’s Pooled Budget on a permanent basis to support on-going demand and expenditure pressures evident in 2016/17. 

(d)       note that the £0.600m budget available to support the cost of sleep-in support for service users will be ring fenced for such purposes, in line with the original budget approval to be used mainly in the area of Learning Disability providers.  Funding will be allocated subject to evidence of actual changes to wages and the outcome will be reported through the Financial Monitoring Report.

The National Living Wage came into force in April 2016 and is over and above the National Minimum Wage which remains in place for those workers between the ages of 18 and 25 years of age.

In November 2015 the Chancellor of the Exchequer announced the outcome of the Spending Review which included provision for increased income generation through an additional council tax precept for the purpose of supporting adult social care costs including the National Living Wage. The Department for Communities and Local Government subsequently noted that this was also in recognition of demographic changes which are leading to growing demand for adult social care, which is increasing pressure on council budgets.

In February 2016 the county council approved an additional 2.0% council tax precept for 2016/17 to support the costs of adult social care in Oxfordshire, including the impact of the implementation of the National Living Wage from 1 April 2016.  In addition a further £0.600m was agreed to be added to the budget to support the impact of the National Living Wage on the cost of sleep-in care.

Some of the Adult Social Care Precept has already been used to reflect the direct impact of the National Living Wage and other agreed cost pressures on providers in 2016/17.  The impact of the National Living Wage is not known either nationally or locally. In view of this the council asked officers to undertake further work in this area to establish its impact. 

Cabinet considered a report that sought approval to recommendations about how the remaining funding should be used within Adult Social Care and that noted the availability of the £0.600m funding to support sleep - in care.

Councillor Glynis Phillips, Shadow Cabinet Member for Adult Social Care commented that there was a lot in the report that she was able to support, including the overall intention to increase staff payments and the £0.6m for sleeper services. However she raised some concerns over the detail and commented that the Labour Group would have liked to have seen more money held back for day care services to provide greater flexibility. She expressed concern that the voice of the workforce was being lost and hoped that future consultations could involve trades unions.

Councillor Heathcoat responded to the points made, noting that the County Council did not have a significant workforce in this so Unison had not been contacted. Councillor Heathcoat highlighted the ongoing pressures in adult social care, the additional funding being made available and referred to the current review of day care services.

Councillor Heathcoat introduced the contents of the report which set out the processes that had been undertaken, the options considered and included recommendations. Councillor Heathcoat referred to a letter sent to all Cabinet Members from the owner of a nursing home that raised a number of points and gave an assurance that this letter would be responded to in the usual way. In moving the recommendations Councillor Heathcoat proposed an additional recommendation to reflect that further work would be ongoing to implement the recommendations and authorising the Director of Adult Social Services in consultation with the Cabinet Member for Adult Social Care to agree the implementation.

RESOLVED:             Considering the evidence received in conjunction with the pressures already apparent in 2016/17 to:

(a)      agree that the assumed hourly rate for home support workers funded through the council’s home support model should be increased from £7.20 per hour to the Skills for Care rate for Oxfordshire of £8.59 per hour.  £1.062m of the Adult Social Care Precept should be added the council’s contribution to the Older People’s Pooled Budget to fund the cost of additional payments to home support providers resulting from the increase to the hourly rate.

(b)      agree that £0.964m of the Adult Social Care Precept should be held as a contingency to support specific in-year pressures raised by providers between October and March 2017. The expectation is that this will be relevant in a limited number of cases where a provider has a longstanding contract and have not otherwise received an increase in their payment rates for a number of years.  Any allocation will need to be evidenced through open-book accounting and agreed on an exceptional basis.   Any balance remaining at year end will be used to support further pressures in adult social care evident by 31 March 2017.

(c)       agree that £3.000m of the Adult Social Care Precept should be used to increase the council’s contribution to the Older People’s Pooled Budget on a permanent basis to support on-going demand and expenditure pressures evident in 2016/17. 

(d)      note that the £0.600m budget available to support the cost of sleep-in support for service users will be ring fenced for such purposes, in line with the original budget approval to be used mainly in the area of Learning Disability providers.  Funding will be allocated subject to evidence of actual changes to wages and the outcome will be reported through the Financial Monitoring Report.

(e)      note that work on the further implementation of these recommendations will be on going and to authorise the Director of Adult Social Services, in consultation with the Cabinet Member for Adult Social Care to agree the implementation.