The Spending Review determines how much is spent on public services. So anyone who ever visits an NHS hospital, or goes to school, or uses roads or any of the other service provided by government will be directly affected.
It's also a chance for the government to deliver on some of the promises it made at the last election, such as improving the economy of less wealthy areas of the UK. The Spending Review also included details of public sector workers' pay next year.
But everyone else, including police officers, fire fighters and teachers, will have a pay freeze,. The chancellor's decisions will affect how much the government borrows next year and beyond. The cost of paying back those debts, or at least paying the interest on them, will fall on future taxpayers for years to come. Usually a Spending Review would cover a period of three or four years to give government departments enough certainty to make long-term plans.
The coronavirus pandemic disrupted so many aspects of life this year that long-term planning is particularly difficult. So the government decided that this Spending Review would only cover the 12 months from April This includes the review of relative needs and resources also called the Fair Funding Review , the business rates reset and the parameters of the new homes bonus.
Providing certainty on these issues would make a significant difference to council financial planning, and therefore public services, even without a Spending Review outcome. Councils could make decisions which provide better value for money for the taxpayer, by making longer term investments that deliver savings, if they had longer term certainty over funding. Of course, if or when financial reforms do go ahead, overall funding will need to be sufficient to facilitate them and to ensure no council sees its funding reduce.
Council tax increases, including the adult social care precept, are not a long-term solution to funding services. Increasing council tax raises different amounts of money in different parts of the country. On its own, council tax falls short of the sustainable long-term funding that is needed to improve the services our communities and local economies will need to recover from the pandemic.
However, that does not mean that council tax cannot be improved even without fundamental reform. We would like to work with Government to make council tax more local:.
Property continues to provide a good basis for a local tax on business. Business rates are efficient to collect and have been relatively predictable and buoyant in recent years. However, the changing nature of business alongside the nature of demand pressures on councils means that we cannot look to business rates to form such a substantial part of local government funding in the future and alternative means of funding councils will be needed instead of, or as well as, a reformed business rates system.
Overall, local government needs a funding system that raises sufficient resources for local priorities in a way that is fair for residents and gives local politicians the tools they need to be the leaders of their communities.
It is therefore important that the tax system provides as much certainty as possible. In the meantime, we are calling on the Government to publish a progress update on the review as part of Spending Review announcements. Investing in infrastructure with capital spending will be crucial to delivering the social and economic recovery from the pandemic, delivering key government priorities on net zero, housing and regeneration, and making the public sector more efficient and able to deliver better value for money while providing key services for citizens.
We welcome the undertaking that any significant changes to the capital regime will be subject to individual consultations, and as yet the full detail of what the changes are and what they will mean is not yet clear. However, we will continue to make the case that any changes need to be proportionate and that the overall framework for capital finance should continue to allow local authorities wide freedoms to borrow and invest, without the need to seek prior approval from government, if councils are to be able to play their key role in delivering capital infrastructure.
Government grant funding of council capital programmes has reduced in recent years. Such funding could help shore up local infrastructure — for example it could reduce the highways repairs backlog by a fifth, be used for local housing and regeneration, or put towards the provision of additional school places.
Where government capital grant funding is available, it is frequently fragmented and accompanied by bureaucratic and burdensome bidding processes. For example, there are at least 11 different capital funding streams for roads investment alone, each with their own arrangements, rules and allocation processes. Councils have frequently had to consider the risk of investing significant time and revenue resources that cannot be spared into long-winded processes that are not guaranteed to deliver any local benefits.
A further funding freedom can be delivered very simply, and at no cost, by making the flexible use of capital receipts arrangements permanent and available to fund all transformational and savings projects. Government first introduced this flexibility in and although extension of the scheme beyond was announced in the Budget, details of how the scheme will operate have not yet been confirmed. The Spending Review is the opportunity to make this permanent, adding certainty and removing the need for further review.
The Spending Review is an opportunity for the Government to lay down a clear statement of intent for moving towards a future model of care and support where people of all ages who need to draw on social care are treated equally, valued for their contribution, respected for their knowledge of what works best for them and supported to live the life they want to lead in the communities they know and love. The plan does not set out any detail on the level of funding needed overall. This is an important dimension of the reform debate, but it does not address immediate pressures, nor deliver any extra, better or different social care for people of all ages who have cause to draw on it.
This is where the Spending Review must act. It is also an opportunity to properly recognise and reward the estimated 1. However, it does not address the issue of care worker pay, which is so crucial for helping to tackle recruitment and retention problems in the care workforce.
If done well, this could create one of the most powerful, positive and lasting legacies of the COVID pandemic for people of all ages. Adult social care is the largest directly controlled local government service by spending — making up more than a third of controllable spending — and continues to grow. Even before the pandemic struck, adult social care was under significant pressure following years of inadequate funding and piecemeal, sticking plaster solutions.
The reliance on the council tax social care precept has been a poor tax base to fund national entitlements under the Care Act. It is highly visible locally, but it has no relationship to need and the money raised has been insufficient to cover increasing costs.
On average, a 1 per cent precept has added 1. The Government must move away from this approach and inject genuinely new funding to tackle immediate pressures. Chart 2: Percentage increase in adult social care budgets resulting from a 1 per cent increase in council tax across all authorities.
We stand ready to work with the Government, as part of the Spending Review and beyond, to make adult social care more resilient and financially sustainable. Only bold and ambitious measures can help deliver better outcomes and better-quality services for people of all ages who have cause to draw on social care and support to live their best life.
The issues currently facing adult social care are not new, but many have been exacerbated by the experience and consequences of the pandemic. As a first step, we therefore need to urgently address immediate funding challenges to prevent further deterioration in the access to and quality of care. This includes the difficult issue of mandating vaccination of the workforce in care homes and the potential negative consequences of this policy.
This has the potential to significantly exacerbate existing pressures on care homes, with consequences for care quality. These pressures have created the significant challenges set out below, many of which have been exacerbated by the pandemic. It is essential that the Spending Review fills this gap — without such action, the pre-existing challenges will worsen.
Carers, who are mostly women 57 per cent , are more likely to suffer depression, anxiety and stress and nearly two-thirds of carers have a long-standing health condition.
Unpaid carers have been more affected by the pandemic compared to the general public on aspects of life including work, loneliness, household finances and access to groceries, medication and essentials. Care home occupancy levels are down compared to last year, threatening care home viability, particularly smaller independent care homes who lack the scale of larger operators to deal with occupancy reductions.
It is also helpful that the Government has looked beyond just this issue, outlining action on, for example, the workforce and supported housing. However, while these are all potentially positive developments, we have serious concerns and question whether they make the kind of progress needed to help adult social care deliver for people. Over the last 18 months, the adult social care workforce has demonstrated to the nation its enormous capacity for resilience, compassion and dedication. Front line care workers have helped keep our loved ones safe and done all they can to support their wellbeing in the most challenging of circumstances.
Proper action on the care workforce must be a lasting legacy of the pandemic, starting with the Spending Review. This does not include the additional value that care and support generates from supporting people who receive services to be in work who would otherwise not be able to. We need to have a sustainable social care workforce that is fit for the future, given the increasing demand for support as the population grows and ages, and as care moves closer to home, becomes more integrated, and new models emerge.
But if we are to meet this challenge and unlock opportunity, we need a coordinated commitment to the workforce, delivered through a workforce strategy or people plan, including action on pay. Alongside other national organisations, our vision for a future workforce strategy and its outcomes is:. Any changes to pay and reward must be fully funded by central Government as there is no resource in the sector to meet the demands of this challenge. The Resolution Foundation have calculated that if a living wage for care workers was publicly funded, just under half 47 per cent of public costs would be returned to the Exchequer through higher personal tax receipts and lower benefit payments.
Research and deliberation will be needed on coordination of other terms and conditions and the introduction of an effective mechanism for implementation and uprating. To achieve those aims with a reasonable degree of consensus across the sector, we continue to urge Government to commission an independent review to promptly review the existing pay levels in the sector and the mechanism for ensuring they support the recruitment and retention of the high-quality workforce the public requires.
Throughout the pandemic, public health services commissioned by local councils have worked quickly, efficiently, and creatively. Public health has used its experience in communications, behavioural insight and health campaigns to engage with local people to tackle outbreaks and maintain safety.
Councils have been flexible and innovative in keeping health and wellbeing services running through the use of digital technology and have sought to tackle the impact of the pandemic on health inequalities. Health is an essential part of the economic recovery and vice versa. For example, public health can play an important role in collating and interpreting relevant population-level data and supporting place-based partnerships in understanding and acting on the health impact of economic strategies.
To make the most of this interrelationship between public health and the economy, councils need the resources to work in partnership with their voluntary and community sector VCS to provide low-level support to improve health, wellbeing, participation and resilience. In addition to the potential of public health services to address health inequalities and support the economic recovery, there is a strong benefit for public finances as well.
Money invested by Government in public health is helping to relieve pressure on other services like the NHS and the criminal justice system. By embedding prevention as a core focus of its strategy, OHID will ensure the best outcomes are achieved for people. We know that one thing that marked England out as COVID hit was our poor public health including our high rates of inequalities, of smoking, and of overweight people and obesity.
The pandemic has demonstrated that prevention must not be sidelined. We need to tackle the 40 per cent of avoidable deaths which result from tobacco, obesity, inactivity and alcohol harm. Increases in the value and longevity of the public health grant are vital to improve these challenges.
The pressure on the public health workforce during the pandemic response has been unprecedented and has highlighted the need for investment in public health capacity at all levels. Government should develop a programme for ensuring sufficient public health professionals are trained and councils sufficiently funded to employ the necessary skilled workforce. It was welcome to see the new Secretary of State for Health and Social care recognise the importance of tackling health inequalities which are preventing us from levelling up the country.
Public health services are vital in achieving this aim — with greater, more consistent funding, alongside other local government services such as housing, sport and leisure provision and employment, councils can influence the future health and life chances of our communities. Health Foundation analysis. Levies on alcohol, smoking and sugary products can discourage consumption of harmful products.
The proceeds could help fund public health services in councils, so supporting the proposals above. The LGA supports this proposal to raise income. The Smokefree Fund is also essential if the government is to achieve the ageing society mission to extend healthy life expectancy by five years by The UK Soft Drinks Industry Levy was one of the first taxes explicitly designed to incentivise manufacturers of sugar sweetened beverages to reduce sugar content.
In the three years since the soft drinks industry levy was introduced, manufacturers have cut the amount of sugar in their products while hundreds of millions of pounds have been raised in revenue.
It is vital that future funds raised so far are invested in the best possible way to ensure that our children get the greatest start in life.
We will publish the Welsh Government Budget on 20 December and will seek to deliver the fairest possible settlement for Welsh public services to secure a more prosperous, greener and just Wales. Delivering public services will continue to be one of the key priorities in our upcoming budget. We will continue to deliver our Programme for Government to address the impact of the pandemic on children and young people, build 20, low-carbon homes for social rent, and deliver the Youth Guarantee.
We will also be publishing our new Wales infrastructure and Investment Strategy, which includes interventions to deliver Net Zero. This statement is being issued during recess in order to keep members informed. Should members wish me to make a further statement or to answer questions on this when the Senedd returns I would be happy to do so. Skip to main content. About cookies. First published:. First published 28 October We look for talented and passionate individuals as everyone at the Health Foundation has an important role to play.
Copyright The Health Foundation Registered charity number Unfortunately, your browser is too old to work on this website. Please upgrade your browser. Spending Review what it means for health and social care 1 November About 10 mins to read. Charles Tallack. Nihar Shembavnekar. Giulia Boccarini. Stephen Rocks. David Finch.
Funding and sustainability. Public health. Social care. Introduction Spending Review saw welcome increases in public sector spending but fortunes for different departments varied greatly.
Health priorities for Spending Review Infographic. Read more. The four priority areas Ahead of the Spending Review, we highlighted four key areas where continued investment — in addition to the extra money already pledged for the NHS in September — is most needed: social care, NHS capital, NHS workforce and public health.
Further reading Infographic.
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