Charge Capping: Effects on Community Care (Hansard, 18 April 1990)

§ The Parliamentary Under-Secretary of State, Department of Health (Baroness Hooper)
My Lords, the determination of central government grant to local authorities and the Government's view of total appropriate local authority spending for 1990-91 took account of resources for authorities to undertake the necessary preparatory work to implement our new community care policy after April 1991. Charge capping applies only to those authorities whose budgets for 1990–91 are excessive, in the opinion of my right honourable friend the Secretary of State for the Environment. The proposed caps are in his view fair and reasonable in the individual circumstances of the authorities concerned.

§ Lord Carter
My Lords, I thank the Minister for that reply. Is she aware that the Association of Directors of Social Services has reported that one-third of local authorities and social service departments have had to implement service reductions and also abandon some new developments in community care as a result of the poll tax? I am referring to authorities which have not been charge-capped. The authorities which have been charge-capped now face the prospect of failing in their statutory duties to provide community care. How do the Government suggest that these authorities resolve that problem?

§ Baroness Hooper
My Lords, as always, it will be for individual authorities to consider how to make the most cost-effective use of the funds that are available to them in the light of local circumstances and overall legislative requirements. We believe that that kind of approach is the one which is most likely to lead to the innovative local, diverse and flexible service that we all seek in bringing in these changes. If it is any reassurance to the noble Lord, I remind him that local authority PSS spending has increased by 38 per cent. in real terms over the past 10 years. There is no reason to believe that that trend will be reversed.

§ Lord Taylor of Gryfe
My Lord, in replying to that question, can the Minister say whether rate capping will in any way limit the new responsibilities that local authorities will assume for caring for the mentally ill and other people who become their responsibility after the Bill becomes law?

§ Baroness Hooper
My Lords, it is for those authorities that have been capped to determine their own spending priorities within their revised budgets in the light of legislative requirements and local needs. However, as I said before, we see no reason to believe that the trend of increased funding for social services will be reversed.

§ Lord Dean of Beswick
My Lords, is not the Minister aware that most of the authorities that have been capped are in areas of the country which suffer the greatest deprivation, and that apart from education which accounts for just over 50 per cent. of local authority spending, those local authority departments which spend by far the highest amounts are social services departments which will have to take on board new duties under the terms of the new Bill? If sufficient funds are not made available, we shall see more disabled and mentally ill people discharged onto the streets, but it will be the local authorities that will be blamed for that situation instead of the Government.

§ Baroness Hooper
My Lords, I see no reason for the noble Lord to spread alarm and despondency in that connection. In the view of my right honourable friend the Secretary of State for the Environment, the proposed charge capping is reasonable and appropriate on the basis of the information available to him in all the circumstances of each authority concerned. The charge capping should not involve any disruption to services. However, as regards future plans for community care, it will be the duty of local authorities to consult in the preparation of their plans and to publish their community care plans. If anything should go wrong, the Secretary of State has powers of direction to intervene.

§ Lord Taylor of Blackburn
My Lords, it is all very well for local authorities to publish their plans, but how can they pursue those plans if they do not have the wherewithal to carry them out?

§ Baroness Hooper
My Lords, the Government have always said that they fully recognise that local authorities will require adequate resources to discharge their new responsibilities. Resource requirements stemming from legislation and new burdens placed upon authorities will be taken into account in determining the level of central government financial support to be given. While no definite estimates are available at this stage, hundreds of millions of pounds have been referred to. The amount that the Government would otherw ise be providing to finance care through social security payments for people in residential and nursing, homes, for example, will be transferred to local authorities on a pound for pound basis in the grant and personal social services standard spending assessments. The sum involved and the total 10 resources for community care will be finally determined in the 1990 public expenditure survey.

§ Lord Stoddart of Swindon
My Lords, is it not a fact that people in this country have been grossly misled by the Government over the poll tax? Did not the Government tell the country that it would be the responsibility of local authorities to set charges in their areas for the level of services which they thought was correct, and that it was then up to the local electorate to discipline or otherwise their local authority? How can that happen if local authorities, having made their plans and drawn up their budgets, are now told by the Government that they cannot carry those budgets through?

§ Baroness Hooper
My Lords, local accountability is central to the community charge system. However, it will of course take some time for accountability pressures to be fully effective. Regrettably a number of authorities have chosen to budget excessively for 1990-91, hence the need for my right honourable friend to use the powers given to him by Parliament to protect charge payers from the consequences of excessive spending.

§ Lord Molloy
My Lords, when the Government's words are put into practice it will become singularly obvious that the community care provisions will be inadequate. The blind, crippled and mentally ill will suffer. Will the Government reconsider their position so that ordinary folk do not suffer?

§ Baroness Hooper
My Lords, there is no indication of the kind of consequences that the noble Lord has suggested. However, the public expenditure survey is reviewed every year.

§ Lord Carter
My Lords, I am extremely surprised by the answer that the Minister has just given. Does she agree with the calculation that has been made that charge capping will result in a reduction of £29 million in the social services expenditure of charge-capped authorities? That sum is equivalent to the cost of 3,500 home helps and 11,500 places for the elderly in residential homes.

§ Baroness Hooper
My Lords, the noble Lord may not be totally aware that the costing of the community care provisions that we hope will be implemented as a result of the Bill which is currently before Parliament will not be taken into account in this year's local authority spending but will come up in next year's public expenditure survey. The amount that has been provided for this year is just for the preparatory work that is required.