§ Dr. Evan Harris (Oxford, West and Abingdon)
I welcome the Minister, as I want him to hear me saying something nice before I start the tale of woe about the dreadful situation in Oxfordshire social services. Those of us who were elected in the last Parliament were pleased to see talent rewarded with his appointment to ministerial rank, and we continue to wish him luck. However, I think that the way in which the Government approach the difficult situation facing the most vulnerable people in some of our communities will be a test.
We face serious problems in Oxfordshire, and have done so for many years. When cuts are being made, I think that hon. Members of all political parties see it as a problem. Social care services in Oxfordshire are facing significant cuts this year, and will do so next year. That has been the case ever since I have been a Member of Parliament, as it was before 1997, when the Conservatives were in power, the Minister's party was in opposition and Labour politicians joined me and other Liberal Democrats in condemning the cuts.
The cuts are not the only problem. The other, related problem is the steep rise in council tax that has occurred in Oxfordshire. The county council, led by parties of all political persuasions, has increased council tax way beyond inflation. Council tax is a regressive tax—it hits people who are on fixed incomes, as the elderly often are. No one is happy about the need to raise council tax to reduce the level of cuts. It is one thing to raise council tax to develop new and improved services, but it is even harder to take when it is done merely to reduce cuts.
Given that there are cuts, and that council tax has risen to nearly double figures on average, there are clearly inadequate resources in Oxfordshire social services. My first question to the Minister is whether, in his opinion, that is indeed the case. I want to give him the opportunity to write that question down, because I do not want him to forget it.
I think that the Minister will find my next question easy to answer. Is he happy that Oxfordshire county council is cutting services to the most vulnerable in society? Does he see that as "one of those things" or as a matter of regret, about which something needs to be done? If he sees it as a matter of regret, what does he suggest that the county council do? Does he believe that the county council should, where possible, increase charges to users of social services, under the Government's policy of fair charging? Does he believe that council tax should be increased yet further, into double figures, to avoid some of the cuts? Does he perhaps think that the central Government grant should be increased to deal with core services?
If the Minister claims that the Government are increasing funding to Oxfordshire sufficiently, why does he think that cuts are being made? If he thinks that that is the case, does he know something that the Audit Commission does not know? That is, is he aware of profligacy and waste, or a pile of money lying unspent in Oxfordshire? Does he believe that Oxfordshire county council is now spending too much on social services, and that it would be appropriate for it to reduce the spend? I remind him that the spend in Oxfordshire is £22 million 221WH over Standard Spending Assessment—that is the budgeted spend, before considering overspend. That is on a budget of £105 million. The SSA—the amount that the Government think Oxfordshire should spend—is £85 million, and it is spending 20 per cent. over that.
Is the Minister satisfied that the amount—the SSA—that the Government think Oxfordshire should be spending on vulnerable service users is adequate? If so, does not that mean that he thinks Oxfordshire is overspending, and therefore should cut services? Does he believe that the council tax is the fairest way of raising extra resources, or that, if there is a choice about how one raises resources from taxation, it would be better to use a more progressive tax, with a more easily identifiable link to the ability to pay?
I shall speak for about another 10 minutes, and I hope that the hon. Member for Witney (Mr. Cameron) will have a minute or so afterwards to put his point of view. I made the point earlier that there is little division between local politicians of all parties about the regrettable nature of the cuts.
§ Mr. Roger Gale (in the Chair)
Order. The hon. Gentleman has mentioned that he wants to invite another hon. Member to participate. He should be aware that in a half-hour debate, that needs the consent of the Minister as well as the initiator of the debate.
§ Dr. Harris
I was aware of that, as was the hon. Member for Witney. I think that, certainly, if the Minister was not aware, he will perhaps now show his willingness to allow the contribution. I mentioned it to show that I did not object. As I have said, I think that there is cross-party agreement on this matter—and local members of the Labour party are included in that, as they recognise that the situation is intolerable.
The budget for 2002–03 reveals a 4 per cent. increase in SSA—the amount of money that the Government think should be spent. However, there is a 5.8 per cent. increase in the social services budget. That is significantly above SSA, so I do not think that the county council can be accused of not spending all the SSA increase on social services. Despite that, there were £9 million or more of cuts in the budget, to repay a £6.4 million overspend in the previous year, plus another £4 million of cuts. It looks as if £7.5 million of cuts have been made, at the price of extreme pain and hardship to social services users, but there is still a likely overspend of £3 million.
I want to make it clear that cuts mean a lack of service for people who need it—not savings, getting rid of waste, cost improvements or other euphemisms. In Oxfordshire we are now talking about taking services from people who need them. Everyone in receipt of domiciliary services—older people and physically disabled people—has had to be reassessed and many have had their provision cut. Those were not easy cuts to make. People's independence is threatened when they receive less care—when, for example, they are given no care or help in the matter of sorting out their house or their home help.
The cuts that we are dealing with included £2 million of budgeted cuts this year in home support for older people; £900,000 of cuts for people with physical disabilities; £1.3 million of cuts relating to learning 222WH disabilities; £100,000 of cuts in children's home support; £100,000 of cuts in physical disability equipment; and £800,000 of cuts for children's homes. Learning disability resource centres for children, which have received a great deal of publicity, were subject to £500,000 of cuts. I think that we know how painful those cuts have been, and will be, to implement. There were £600,000 of cuts in residential accommodation for old people and £100,000 of cuts in day centres.
Of course, it has not been possible to deliver all those savings, and legal action has been taken to challenge some of them, as the county council is bound by statutory duties. The Government need to explain which of those cuts they are happy with and where more cuts could be made.
The cost pressures in the coming year also look drastic. Before the Minister says that everything will be fine and that there will be a 6 per cent. increase in real terms in Government funding for SSA, I ask him to say whether he is aware of the unavoidable pressures, over and above inflation, that exist in social services. For example, to deal with the problem of delayed discharge for older people, a 5 per cent. increase in fees—more than was budgeted for and more than inflation—is the minimum needed to maintain capacity, let alone build on it, in the care home sector, which suffers cost pressures of £740,000. Physical disability service purchasing faces cost pressures of £140,000, as a result of a 5 per cent. increase in fees when in fact providers need between 10 per cent. and 15 per cent. to keep the services afloat. For learning disabilities, cost pressures of £300,000 are predicated on a 5 per cent. rise in fees.
As far as demography is concerned, one cannot blame Oxfordshire for increased longevity or for people surviving with disability beyond childhood; indeed, the Government might argue that they should take credit for it. However, a 1.69 per cent. increase in the number of older people is forecast for the coming year, which predicates an additional spending pressure of £240,000 just to keep the same services. For physical disabilities, there is an anticipated increase of 0.8 per cent., but on previous experience, that will amount to 15 extra clients costing another £200,000. In learning disability, another £50,000 will be needed.
There is more. Because the planned savings by learning disability resource centres are not achievable, there will be the pressure of another £400,000 over budget. In mental health and acquired brain injury placements, £225,000 more will be needed because of increased demand for an expensive service. That stems from mental health review tribunals and an increased incidence of injury—and it assumes a 50:50 share or thereabouts with the health service.
The Government's changes to charging—called fair charging, which I do not necessarily disagree with—have cost implications for those counties that were charging above that rate. The loss of income, which will now have to be corrected to be within Government guidelines, is £1.1 million. That, effectively, is an extra duty imposed by the Government. Foster care allowances are up by £167,000 because Oxfordshire now pays less than the recommended rates.
There is more. Information technology needs £110,000 to administer Government grants to service providers because that responsibility was transferred 223WH without funding. Home support for children with disabilities will be £195,000. The cost of administering the payroll will be another £65,000. It is estimated that the social care of asylum seekers will cost £200,000, following the Law Lords' ruling that if local authorities have responsibility for the community care health needs of asylum seekers, they must also provide accommodation and cover subsistence costs.
The list goes on. Significantly, independent foster agency placements will need £234,000; and intentionally homeless families will want £200,000 since courts are now directing councils to support some homeless families. It is an extensive list, but I have not yet dealt with the increase in employers' national insurance contributions that the county council will have to pay. Is the 6 per cent. real terms increase in SSA or in Government funding in addition to extra money needed to pay for those national insurance contribution increases, or is it part of the 6 per cent.?
Will the Minister answer the following important questions about grants? Oxfordshire currently receives a building care capacity grant of £1.5 million and a promoting independence partnership grant of £1.6 million. It is still not clear whether those grants will continue or whether they will have to be absorbed into the 6 per cent. increase. It is bad enough that people cannot plan because they are not sure whether the grants will continue, but it will be even worse if the grants do not continue and they are threatened with having to find that money from the 6 per cent. increase. The increase clearly will not be enough.
Do the Government accept that a tragedy is overtaking vulnerable people in Oxfordshire? The elderly, the mentally ill, the physically and learning disabled and young people at risk are bearing the brunt of underfunded extra duties placed on social services. The county council has been unable to raise council tax any further within reason, even if it had not been capped during previous years. Those cuts in services to the most vulnerable in society are the sort of cuts that the Labour party in opposition used to condemn.
The Labour party claimed it came to power to do something about such treatment of vulnerable people, and to reverse the cuts. Will the Government take responsibility today for the level of cuts affecting services to those vulnerable groups? If not, that will be seen as a disgraceful and immoral abrogation of their responsibility to the people of Oxfordshire, who know that the Government, not any local political party, are to blame, and they will not forgive them.
§ Mr. David Cameron (Witney)
I congratulate the hon. Member for Oxford, West and Abingdon (Dr. Harris) on securing the debate, and thank him for allowing me to take part. He spoke extremely clearly. We have a most serious situation in Oxfordshire. We are spending £20 million more than the standard spending assessment, but it is still necessary to make severe cuts. The social services inspectorate gave Oxfordshire social services a fairly clean bill of health, so the problem is one of funding. I join him in begging the Government to help us.
224WH I would like to make three quick pleas. First, there are three care homes in my constituency whose future is in question. Rural areas need more funding for sparsity so that great homes such as Langston house in Milton-under-Wychwood can survive. Secondly, during the summer Adjournment debate, I raised the question of adult placements. That would not require more money from the Government, but it would require them to think about regulation. I have had no reply to the points made during that debate, to my letter sent to the Department of Health, or to my written question. Adult placements are like fostering services: they do not need to be subject to the National Care Standards Commission. I would grateful if the Minister would consider that point.
My third plea to the Minister is that he should come and visit Oxfordshire. The hon. Member for Oxford, West and Abingdon and I would gladly show him around. I would take him to Chipping Norton and show him those older people who have had their care assessments changed, and introduce him to the parents of children who have had their care packages changed.
We have to get it right. Carers in Oxfordshire are under huge pressure, and if they pack up, the cost to the state and the county council will be even greater. We have to grab the issue—it is the most important one in Oxfordshire at the moment. I look forward to the Minister's response.
§ The Parliamentary Under-Secretary of State for Health (Mr. David Lammy)
I congratulate the hon. Member for Oxford, West and Abingdon (Dr. Harris) on securing this debate on social services in Oxfordshire. Clearly, social services staff play a vital role in the support of some of the most vulnerable people in society. I agree that the matters he raised are extremely important to his constituents and people throughout the country. I acknowledge that health and social services in Oxfordshire are operating under tremendous pressure. I was pleased that he paid tribute to staff in social services and the national health service, who manage to do a first-class job for may of their patients and clients, sometimes under very trying circumstances.
The hon. Gentleman mentioned resources. Between 1996–97 and 2002, resources have increased by more than 20 per cent. in real terms, an average of more than 3 per cent. a year. That compares with an average, annual, real terms growth of only 0.1 per cent. between 1992–93 and 1996–97. He must acknowledge that. He went on to make some very strong political points, suggesting that the Government do not care about social services in Oxfordshire, but that is not the case.
That is why we are putting in extra funding across the board. Such decisions are the responsibility of the local authority. I am advised—the hon. Gentleman may want to correct me—that the nine-strong executive of the local authority is drawn from the Conservative and Liberal Democrat parties, and that its own corporate self-assessment of council tax was that in 2002 it spent £689 per head of the Oxfordshire population, compared with an average of £749 in other county councils; only three county councils spent less than Oxfordshire. That was the assessment of the Liberal Democrats and 225WH Conservatives who run that part of the country. I therefore ask the hon. Gentleman to be less strong in making political points about this important subject.
§ Dr. Harris
I am grateful to have the opportunity to explain what those figures are about. They were intended to answer the charge that Oxfordshire is an overspending county council and that the cuts are a consequence of that. The figures show— the same point has been made by Labour-Lib Dem and by Labour-Conservative administrations—that Oxfordshire gets a bad deal, relatively speaking, and is not a wildly overspending council that needs to reduce its overspend.
§ Mr. Lammy
Let me go on to deal with resources more specifically. Decisions are about to be made across Government, and I do not intend to pre-empt the various formulae that are about to be produced. I should say, however, that the local authority run by the Lib Dems and the Conservatives went on to say that this year's consultation showed that many people would still be prepared to support a larger council tax increase, especially if it was cleat which services would benefit. I am not responsible for executive statements made by the Liberal Democrats and Conservatives who run Oxfordshire; I am responsible for the Government. As I said, we are making a 20 per cent. increase across the board, while specifically ensuring that money goes to Oxfordshire.
Looking to the future, the hon. Gentleman will be aware that the Chancellor's Budget statement in April indicated that resources will increase again by an average of 6 per cent. a year in real terms over the next two to three years. That includes an extra £100 million over the next three years for each full year of operation of the new scheme to tackle delayed discharges that the Health Secretary announced a week or so ago. The local government finance settlement for next year will be announced by my right hon. Friend the Deputy Prime Minister on 5 December, and I am unable to say anything today about the exact allocation of resources to individual local authorities, including Oxfordshire, for next year. Those details and the new general grant allocation formulas will be published on Thursday. Like all hon. Members, the hon. Gentleman awaits those decisions, which all our local authorities will examine carefully.
The means of distributing funds for future years has been the subject of an extensive review. There has been a full consultation exercise on the proposed changes for channelling money through to local authorities. Until now, the grant has mainly been distributed using standard spending assessments by the Minister for Local Government and the Regions. It is right that we look afresh at the formulae. One of the aims of the review of allocation formulae is to make the new system more transparent so that people affected have a chance of understanding it.
There is a trade-off, however, in that the price of oversimplification is a system that fails to take account of the appropriate indicators, and we need to avoid that. When coming up with a formula that applies nationally, it is extremely difficult to guarantee that every local authority will benefit. Local government has called for an increase in predictability and stability in any new system, which is obviously important for county councils such as Oxfordshire.
226WH Turning to the specific resources available to Oxfordshire county council, we all await the announcement with interest. For this year, its personal social services SSA has increased by 5.6 per cent., compared with the national average increase of 4.9 per cent. Similarly, for the past year its SSA increased by 6.5 per cent., compared with the national average increase of 4.7 per cent. In addition to its SSA, Oxfordshire receives substantial specific grant allocations from the Department of Health. This year, for example, it has received a preserved rights grant of more than £6 million, a children's services grant in excess of £3 million and, in order to tackle delayed discharges, a building care capacity grant of £1.5 million.
The authority's grant allocations have also shown marked increases in recent years. This year, for example, the carers grant has increased by 22 per cent. and the children's services grant by 11 per cent.
As I said at the outset, I recognise that there are pressures on social care in Oxfordshire. In particular, the authority is concerned, as the hon. Member for Witney (Mr. Cameron) said, about the shortage of affordable residential and nursing home places. The substantial increases in personal social services resources that the Government are making available over the next three years will help. We should continue to ensure that investment is maintained, but it is only one part of the equation and not the only criterion by which we should judge the success or otherwise of the reforms, because it is fundamental that other things happen as well.
I should like to commend Oxfordshire social services and its primary care trust health partners on the creation of a pooled budget under section 31 of the Health Act 1999 for the purchase of residential and nursing home care. That is one way in which to maximise the purchasing influence of health and social care.
During this year, Oxfordshire county council has also had the benefit of support from the Department of Health funded change agents team, which has worked with the health and social care economy to identify further improvements to both the system and the use of capacity in Oxfordshire. All the partners have signed up to an action plan, and it is of the greatest importance that they follow through and implement the agreed action to secure improvements for service users and patients.
The hon. Member for Oxford, West and Abingdon criticised the resources available to Oxfordshire, and asked for the Government's response. Most resources available to local government are not earmarked for any particular purpose. It is for individual local authorities to decide how much to spend on their social services in the light of local priorities, and how to make the necessary resources available, which includes deciding how much should be raised by council tax. We have heard the assessment, which was made locally by the Oxfordshire executive—by Liberal Democrats and Conservatives—on council tax, which is a matter for them and not for the Government. The SSA is not an indication of how much the Government consider Oxfordshire should spend on its social services, which is a matter for Oxfordshire to decide in light of its priorities.
§ Dr. Harris
This year's council tax rise is 9.9 per cent., which is three or four times the level of inflation, because 227WH Oxfordshire people would rather have rises in an unfair tax than suffer even more cuts. Can the Minister explain whether he thinks that that is insufficient? If all the money is going into Oxfordshire, can he explain why Oxfordshire is still spending above its SSA, despite what he described as "a generous SSA settlement"? Is it his opinion that it is spending too much?
§ Mr. Lammy
The hon. Gentleman will be aware that I acknowledged that there are pressures in Oxfordshire. At the same time, the Government have to look across the board. I explained that we have increased the amount available to Oxfordshire by much more than the national average. If Oxfordshire is overspending its personal social services budget, it needs to improve its budget forecasting. Oxfordshire has been clear that there are issues relating to deficits and financial management that it wants to get to grips with in order to move forward. There will therefore be local determinants for which the Government, quite rightly, are not responsible, and—