The introduction of the National Living Wage (NLW) this week will push care services for disabled people towards breaking point, says the Local Government Association (LGA).
While the NLW – that comes into force on 1 April 2016 – but warns it risks destabilising the care provider market by adding a significant cost to the social care system.
It says that Councils have already had to close a £5 billion funding gap in social care since 2010 and are continuing to struggle with major ongoing pressures.
Previous LGA analysis indicated council tax rises to increase funding specifically for social care will bring in around £372 million in 2016/2017.
The LGA is warning that, for some councils, all of this extra money will be swallowed up by covering the cost of the NLW.
For others, it will not be enough to cover increased care provider costs let alone cover the cost of other pressures within the system and protect social care services from any further cutbacks.
The LGA is calling for the Government to – as a starting point – bring the £700 million of new funding earmarked for social care through the Better Care Fund by the end of the decade forward to this year.
It will also be organising urgent talks with care providers to tackle growing concerns that the ongoing social care funding crisis and the introduction of the NLW will see care providers pulling out of the market or going bust.
For more information see http://www.local.gov.uk/web/guest/media-releases/-/journal_content/56/10180/7763990/NEWS