Councils nearly quit Better Care Fund, PAC reveals

25 Feb 15
Changes made to the Better Care Fund, which allowed some pooled money to be used to provide NHS services, nearly led councils to walk away from the scheme, it has been revealed.

By Richard Johnstone | 26 February 2015

Changes made to the Better Care Fund, which allowed some pooled money to be used to provide NHS services, nearly led councils to walk away from the scheme, it has been revealed.

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Examining preparations for the implementation of the government’s flagship reform from April, the Public Accounts Committee said the change, announced last July, was needed due to ‘deeply flawed’ development in Whitehall.

Under the alterations, as much as £1bn pooled from the NHS and councils will be allocated against a local target for reducing the number of unplanned hospital admissions by at least 3.5%. If this target is not met, the balance will be used to support NHS-commissioned services, as agreed by the Health and Wellbeing Boards.

This alteration was made following concerns that hospitals may lose out from the scheme, but MPs said it moved the financial risk onto councils.

PAC chair Margaret Hodge said it ‘shifted from improving local services through integration to protecting NHS resources’.

‘The Better Care Fund is meant to transform local health and social care services by pooling resources,’ she added.

‘It appears to the committee that NHS spending was judged a higher priority than supporting adult social care.

‘The Local Government Association considered that the redesigned scheme moved the integration agenda backwards and not forwards, and it told us that local government had contemplated walking away from the fund. Local areas are now at greater risk of not being able to implement the policy.’

Today’s Planning for the Better Care Fund report stated this change was needed after the 151 local plans in the scheme did not meet a savings target projected by the Department of Health.

‘Whilst NHS England and the Department of Health worked on a planning assumption that the fund would secure £1bn in financial savings for the NHS, the Department for Communities and Local Government had not worked on the basis of a required savings target,’ Hodge added.

‘The failure to be clear with local areas about the expected savings severely undermined the initial planning process. When local plans were stress tested, savings of just £55m were identified – nowhere near £1bn.’

Following the submission of revised plans to government last September, the 151 areas now propose to pool £5.3bn and save £532m in 2015/16, the committee said.

However, Hodge added MPs were ‘not convinced’ that it was possible to make these savings in one year, as the challenge of reversing long-term upward trends admissions was significant.

Responding to the report, a government spokesman said the BCF was the biggest ever national programme to join up health and social care and would help more people to stay at home as well as potentially cut emergency hospital admissions by around 160,000.

‘All areas have now had their plans approved and are on course for the April 2015 launch of the fund,’ he added.

‘This will ensure that people will be able to get seven-day care services that work for them and could save half a billion pounds of taxpayers' money in the year ahead.’

A Local Government Association spokesman said the report rightly recognised the pressure put on councils following ‘last-minute government changes’ to the fund.

‘The failure to set out the £1bn savings target to councils along with ministers’ decisions to move the goal posts to respond to financial concerns raised by the NHS has made carrying out these plans more difficult and left many councils with very little time to implement the changes before the April 2015 deadline.

‘While it was clear from the outset that the Better Care Fund was not bringing in new money for health and social care, the fundamental problem started when the £3.8bn pool was placed in the spending power for both the NHS and local government, making the process competitive rather than collaborative. Local government is still committed to the principles of health and social care integration, but it must be a shared ambition.’

Responding to the report, CIPFA’s health policy advisor Paul Carey-Kent said: ‘Although the report has highlighted that ambitions for the BCF were perhaps unrealistic, for example that the trend in non-elective admissions be sharply reversed in a year. What hasn’t been emphasised is that transformative change takes time and the Government’s aims for the BCF have lacked clarity and shifted unhelpfully, which has caused problems in local planning.

‘It also important to keep the bigger picture in mind. Given that there are acute financial pressures on both health and social care, there was always a balance to be struck and the BCF was designed to support all parts of the system by aligning public services.’


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