A National Care Service Will Mean Big Changes And Challenges For Scottish Councils Funding

2nd September 2022

This article from the Institute for Fiscal Studies on the National Care Service to be set up by Scottish Government poses some worrying questions. Reorganisations on this scale usually come with increased costs and major restructures take time. Things may be different but will they be better. Big changes will be needed to councils if a big part of their budget is taken away.

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Plans for a Scottish ‘National Care Service' would centralise over £4 billion of spending and may not lead to more consistent services.

The National Care Service (Scotland) Bill currently going through the Scottish Parliament will allow Scottish Ministers to transfer adult and children's social care services from councils to a new, national service. The aim of this is to provide more consistent (as well as higher-quality) social care services across Scotland - although, at a local level, the plan is for services to be delivered by new ‘Care Boards', rather than a single national agency.

Whether it will achieve its aims is far from clear - the National Health Service, where regional ‘Health Boards' deliver services locally but are accountable to Scottish Ministers in a similar way, still sees notable differences in performance and outcomes across the country. The plans would represent a big change in Scottish councils' responsibilities, and require the reallocation of billions of pounds in funding, potentially posing challenges.

A big change for Scottish councils' funding arrangements
In 2022-23, councils are budgeting to spend £4.3 billion on social work and social care, roughly one-third of their overall spending, and more than ten times what they spend on roads and transport. Shifting responsibility for adult and children’s social care services from councils to new ‘Care Boards’ would therefore require transferring around one-third of councils’ budgets. Education spending would then account for almost 70% of councils’ net expenditure on services, up from 47% this year. Council tax would pay for 31% of councils’ net service expenditure (and over 100% of net non-education expenditure), up from 21% (and 39%) currently.

Importantly though, councils have a degree of discretion over how much they spend on social care services. In particular, they can choose to raise more or less through council tax, and they can choose to allocate more or less of their budget to social care services relative to other services. For example, councils’ Band D tax rates this year vary from £1,206 in the Shetland Islands to £1,443 in Midlothian. And social work and social care spending varies from 25.5% of net service expenditure in relatively affluent East Renfrewshire to 37.9% in relatively deprived Dundee.

These choices poses a challenge for centralising the funding of social care services, as we have discussed before in relation to England’s social care system.

Read the full article HERE