Written Statement - Update on Reform of the Arrangements for Paying for Social Care and Support

Members will be aware of the programme of work being undertaken to introduce further reform to the arrangements for paying for social care and support in Wales. This is to make those arrangements fairer and more sustainable than at present. I now wish to update you on this reform.

The independent research study we commissioned last year, conduced by LE Wales, has been completed with the production of a second report. This second report identifies and appraises a set of possible options to introduce further reform of the arrangements for charging for both residential and non-residential care and support. These options cover both potential reform of individual aspects of the existing arrangements, as well as more fundamental reform of the arrangements as a whole. Any reform which might be introduced would take place in the context of our initial reform introduced in 2011 whereby those receiving homecare and other community based care and support cannot currently be charged more than a maximum charge for this of £60 per week.

The Paying for Care Stakeholder Advisory Group, which was reconvened last autumn, has also concluded its considerations with the production of its own report. The Group considered a range of issues around the current charging arrangements and how these impact on those who are required to pay for their care and support. It also considered and provided its views on each of the potential options for further reform identified by LE Wales.

I have now had the opportunity to consider both reports in detail. I am impressed with the level and quality of the information and findings presented within each and would like, therefore, to put on record my gratitude to those involved in producing them. Both provide an evidence base to inform our thinking on the nature reform should take.  I am publishing both reports, which can be accessed online.

In considering the potential options for reform, however, there is a need to be clear on two key related issues which have the potential materially to influence the nature of the reform we take. These are:

• the uncertainty over the detail of the reform which may take place in England. The current UK Government has consulted on draft regulations and guidance to implement reform it wishes to see introduced from April 2016 but has made no announcement of the outcome of this in advance of the general election. Consequently, there remains uncertainty as to what reform may be introduced in England and what consequential funding may flow to Wales as a result of new funding being provided for this. This is important given the substantial funding involved with the potential reform options LE Wales identified;
• the future of welfare benefits and pensions reform. The current UK Government has made substantial changes to both the operation and level of welfare benefits and pensions in the UK.  Such incomes, in the main, provide the means from which a person meets any charge applied to the care and support they receive. Consequently, it will not be clear until after the general election what approach the future UK Government will take to this reform and its effect on the income of those in Wales in this position. Moreover, the whole future of welfare benefits in the UK has been called into question following the Smith Commission on future devolution in Scotland. This has added a further level of policy instability in this area.

Given this uncertainty, and the importance of this information, I have concluded that I will not be in a position to make an informed decision about what substantive reform to introduce in Wales until these matters are better resolved. . Given the timescales involved it will not be possible to introduce this reform from April 2016 as originally intended.     

Nevertheless, I am putting in place from April 2016 an updated financial assessment and charging framework under the Social Services and Well-being (Wales) Act 2014. This will strike a balance between protecting those care and support recipients on low financial means, while at the same time affording local authorities the ability to collect a contribution to the cost of providing this in order to maintain that provision. The framework will, in the main, consolidate existing arrangements but will strengthen them in several important areas to introduce greater clarity and consistency. Main elements of this framework will be:

• one set of financial assessment arrangements rather than the differing arrangements for charging for non-residential and residential care and support which presently exist;
• maintaining the present weekly maximum charge and “buffer” for non-residential care and support, as well as the current capital limit used to determine who pays the full cost of their residential care themselves;  
• maintain the current individuals, or forms of care and support, for which a charge cannot be made, e.g. undertaking a financial assessment or six weeks free home care following a period in hospital;
• introduce in line with existing policies the ability for a local authority to charge a low level flat rate charge for prevention or assistance provided (the provision of information or advice is exempt from charging under the Act);
• introduce more transparency by extending the requirement for all those who receive a charge to receive a statement detailing this and its calculation;
• introduce a consistent, universal review process to enable a person to challenge charges made and correct errors; 
• maintain deferred payments in residential care to enable those whose property may need to be sold to pay for this to delay the sale until a time more appropriate for them; and to introduce the ability of a local authority to charge a low set rate of interest on the amount deferred so as to help make such arrangements cost neutral to authorities.

I will consult shortly on the draft regulations and code of practice required under the Act to introduce such a framework, as part of the second tranche of public consultation on the regulations, codes and statutory guidance needed to implement the Act.

This new framework will pave the way for introducing further reform once the necessary clarity is available to do so.