Unlocking £300 million of income for adult social care

By Paul Mason, managing director – OnDemandservices, Civica

Adult social care (ASC) is facing a funding gap of around £1.2bn this year, and that’s just to keep up with the current need. As a result, 81% of councils expect to overspend on their budgets in 2024/25. It’s no exaggeration to say that lots of councils are walking towards a financial cliff edge where Section 114 (bankruptcy) notices threaten to become a reality. In fact, latest figures show that over 20% of upper-tier councils, those with adult social care responsibility, have accessed exceptional financial support over the past few years.

With this in mind, we recently arranged a roundtable event in partnership with the Association of Directors of Adult Social Services (ADASS) to share experiences, insights and best practices for building greater financial resilience.

Directors of adult social care and financial assessment managers from councils up and down the country were in attendance. The topic is clearly one that is front of mind for social care leaders everywhere. In fact, the event was so oversubscribed that we decided to arrange a second session to give even more council representatives the chance to join in.

Discussions centred on how to keep on top of financial assessments as well as approaches for better management of debt reduction.

Here are a few of the key takeaways.

Backlogs in financial assessments

Difficulty in keeping up with new financial assessments was flagged by several attendees. If councils don’t have the resource to review financial assessments every year, they risk missing out on potentially £millions of income. It also makes it more difficult to ensure that financial support for care is reaching those that need it most. It was noted that the backlog can have a big impact on the moral of council staff, which can be very detrimental to wellbeing but also affect efficiency, so the problem can proliferate.

We recently worked with Sunderland City Council on 1,500 financial assessment cases, with Julie Lynn, head of business development, sharing that this work has helped to increase annual income by almost £5 million. Now that its backlog has been cleared, she spoke about some of the innovative approaches that they are introducing to further streamline and simplify financial assessments, as well as speed up the process for the customer. These include running online assessments and reviews, automating some of the standard uplifts, and being better able to segment cohorts so that time could be prioritised on the assessments that need the most attention.

After the discussion, I decided to take a closer look into the total cost of the financial assessment backlog. With our view from working with councils across the UK and based on conversations with numerous senior people throughout the sector, we can quite reasonably estimate that the financial assessment backlog could be costing councils as much as £300 million every year.

At a time when budgets are already stretched to their limit, getting help from qualified external suppliers can be the quickest way to not only reduce the backlog, but in cases like Sunderland it can actually bring a substantial return on investment.

Debts are growing

Identifying the correct amount of social care funding contributions to be covered by councils is essential for financial resilience, which is why keeping up with financial assessments is considered so important.

However, collecting the debt was identified by many attendees as often being challenging to manage. The shared experience is that there are people reluctant to pay their contributions, or simply can’t afford to by the time they are being chased.

The result is that outstanding debts are growing, and in some councils this can be by as much as £1m+ in additional debt every single year.

Leaders discussed how social care lacks the same kind of enforcement powers found in other local government revenue collection, such council tax or housing benefits. As a result, councils are spending lots of time chasing citizens to pay their contributions, which is difficult to balance alongside the time that is also required to complete assessments in the first place.

Getting help to establish better financial resilience

Following feedback received during the sessions, it was suggested that central government could consider national regulations for debt collections. This might include preventative actions when receiving a suspicious claim, an assumption that an individual will cover their full costs if they do not engage in the process, or even a push for attachment to benefits as a debt recovery tool.

Events such as this always provide a useful window into the offices of different, non-competing teams that are confronting the exact same challenges. Organisations like Civica can provide an immediate solution to the issue around regular financial assessment reviews and are investing in technology to improve outcomes for councils and their citizens.

In the second part of this blog, I will be covering groundbreaking work to help councils deal with these challenges in the future.

For more information on how our OnDemand team can assist your council, visit here.