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Social Care providers running out of options in attempting to reduce costs

A new research report commissioned by HFT, a national charity supporting adults with learning disabilities, carried out by independent economics and business consultancy Cebr, shows that a growing number of care providers for people with a learning disability have run out of options when attempting to make cost savings, and have been forced to cut support for vulnerable adults.

The research found that one in five organisations are offering care to fewer individuals as a means of balancing the books, a rise of 12% from 2018, with 95% citing rising wage bills as the main drain on resources.

Significant increase in providers offering care to fewer people

The report revealed that fewer organisations had made internal efficiency savings in 2019 (79% compared with 92% in 2018), closed down parts of the organisations and/or handed back contracts (45% compared with 59%), curbed investment (39% compared with 45%) and reduced the scope of services provided (24% compared with 35%).

But around the same proportion of care providers (33%) had to shred staff this year compared with 35% last year, and there was a dramatic rise in the proportion of providers offering care to fewer people (20% compared with 8%).

Josie Dent, Senior Economist at Cebr, said:

“Pressure on social care providers to cut costs while also paying for increasing wage bills and agency worker fees has ultimately culminated in organisations taking drastic measures. The share of providers now offering care to fewer individuals doubled compared to last year’s survey. Meanwhile, the proportion having to make internal efficiency savings, close parts of the organisation or hand back services to local authorities remained high. The sector desperately needs more funding in order to provide the same level of care and support to the people who need it.”

Social care has run out of options

HFT public affairs and policy manager Billy Davis said the Sector Pulse Check Survey is the first of its kind to focus primarily on learning disability providers.

“As our Sector Pulse report shows, the sad reality is that the social care sector has run out of options. While in the previous report providers were focusing on streamlining through internal efficiency savings, we can now clearly see that cuts are affecting people, not just processes.

“The lack of a sustainable cash injection for the sector has seen providers resorting to offering care to fewer people to manage spiralling costs at a time when demand for social care is widely acknowledged to be growing.

“The fact that providers are now having to take what they reported to be their least favoured cost cutting measures illustrates that these decisions are not being taken lightly. A lack of alternatives has left providers with no choice but to make decisions culturally at odds with the way they want to run their organisations, such as handing back services and, ironically, shedding staff in the midst of a sector-wide recruitment crisis.

“Given the fragility of the social care sector, there’s never been a more important time to hear the views of the organisations providing care for some of the most vulnerable people in society. This report is an opportunity to hear the collective voices on the issues facing the sector and we must listen. It’s clear that at its heart social care funding is, and continues to remain, a national issue that requires a national solution.”

Fall in standards of quality care

In last year’s report, 11% of providers warned further cuts in funding could lead to a reduction in the quality of care. This year, 43% of providers said that they had witnessed a negative effect on the quality of care they were able to provide, citing an increase in complaints, worsening CQC accreditations and a decrease in morale as the most severe indicators of a decline in standards.

Rising wage bills

As found in previous surveys, the report cited rising wage bills as by far the largest cost pressure facing providers, with the increase in the National Living Wage (NLW) having the biggest impact.

Almost all (95%) care providers reported rising wage bills to be the biggest cost pressure, compared with 88% in 2018, with 63% saying the NLW had a significant impact.

Summary

This report confirms the that there is a continual reduction in the provision of social care to those most in need of it. Improvements in efficiency alone will not address the increase in the National Living Wage. Many providers feel that they have now run out of options. It is ironic that at a time when the sector is trying to recruit more people to the industry, some providers are actually shedding staff.

The outcome of all this is an inevitable fall in the quality of services provided.

Albert Cook BA, MA & Fellow Charted Quality Institute Managing Director Bettal Quality Consultancy

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