Pilot error

19 Jan 12
James Lloyd

Politicians have missed a trick by not piloting some of the recommendations of the Dilnot Commission on long-term care funding

With the cross-party talks on social care funding reform now under way, there is at least one option that should not ruled out by politicians: piloting.

It’s perhaps the least sexy part of policymaking, and certainly not something results-hungry, politicians get excited about. But, as any good policy analyst knows, piloting new policy proposals is responsible, sensible and a key component of effective policymaking.

In the wake of the Dilnot Commission on Funding of Care and Support, the debate on long-term care funding in England has moved to focus on how quickly the Commission’s ‘capped cost’ model can be implemented, and what level the ‘cap’ should be. Inevitably, the idea of a £35,000 cap has given way to discussion of a £50,000 cap (or something even higher), coupled with Treasury concerns about the extra costs of the model for the public purse.

However, a key option for policymakers now would simply be to pilot the core recommendations of the Dilnot Commission. This is why:

  • No country in the world operates the kind of model proposed by the Dilnot Commission (sometimes known as a ‘limited liability’ model). As such, there is no evidence base available regarding what would happen in practice and how different cogs in the care system would respond and adjust to the new arrangements. Piloting means lessons can be learnt from implementation before rolling out nationally.
  • The nature of the social care system in England – effectively comprising over 100 separate mini, local authority care systems – means that trying out new ideas first at a local level is easy. Indeed, much social care policy over the last decade has drawn on path-leading councils trying out new arrangements for things like personal budgets, holistic support for carers, and commissioning. There’s no reason that new ways of spending public money on care should be any different.
  • It’s important to test the assumptions of the Dilnot Commission. A key argument of the Commission is that if the state spends more in order to fund a £35,000 cap on care costs (or more precisely, a cap on how much council support individuals are excluded from owing to their wealth), this will take away the ‘fear’ that care users have of ‘catastrophic costs’ that prevents them from spending their own money on support when they still have low-level needs. The Commission believes the fear of ‘catastrophic costs’ results in a kind of ‘precautionary saving’ that ultimately sees individuals experiencing worse needs unnecessarily, because they don’t use their own money early on in the care journey. But, this important argument put forward by the Commission – effectively suggesting that more public money in the social care system will result in more private money – ultimately represents an assumption about human behaviour. There’s no evidence to suggest that in practice this is how home care users would respond to the cap (particularly as they may have one eye on the top-ups they will have to pay as ‘self-funders’ in residential care, even after they have reached the ‘cap’).
  • Building on the importance of human behaviour, it’s critical to note that the ‘capped cost’ model creates potentially perverse incentives for two types of agents in the social care system. Families providing informal care would not see the ‘meter’ of notional packages of support for their loved one increase because of the care they provide, creating incentives to declare they are no longer able to provide informal care in subsequent assessment, thereby boosting the financial value of the ‘notional’ support they are allocated. Such behaviour – in short, gaming - already exist in the current system, but would be amplified considerably under the ‘capped cost’ model.
  • Conversely, the ‘capped cost’ model may introduce perverse incentives for social workers undertaking assessments. By and large, social workers go into the profession to help people. How will social workers on the front line respond to the requirement to undertake assessments for ‘notional’ support? Perhaps by being over-generous in the ‘notional support’ they allocate?
  • Last but not least – moving to pilot the Dilnot Commission proposals would give this part of the debate a temporary resting point, and force all stakeholders to focus on the even bigger question – indeed the elephant in the room – how will the extra £12bn each year required by 2025 for public spending on social care and disability benefits to remain equivalent to today be found (on top of the £3bn that the Dilnot Commission proposals will require)? Piloting the Dilnot Commission proposals would keep momentum for reform, while creating space for politicians – and older people’s lobby groups – to face up to the hardest questions to answer.

James Lloyd is director of the Strategic Society Centre


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