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Implementation of social care personal budgets posing major challenges for councils

A new report reviewing progress towards people taking control of their own social care funding says councils are facing major challenges in getting their financial arrangements right. Some councils are lagging behind and are not on course to meet national plans.

'Disentangling pooled NHS and social care funds' is a particular problem and may mean that people with mental health needs miss out.

Personal budgets allow those in receipt of an adult social care support plan, or their carers, to decide how best to spend their own personal budget. They bring flexibility, choice and control. Introduced in 2007, the Coalition re-stated the government's commitment to personal budgets in May this year.

Published today by the Audit Commission, Financial Management of Personal Budgets looks at the implications for councils.

Managing Director of Health at the Audit Commission, Andy McKeon, says:
'Councils are undergoing a major transition from being providers of adult social care services to becoming providers of personal budgets. Our report looks at the choices for allocating money, and explains how councils can plan for the financial implications.'
'We also examine the changes in social care commissioning and the governance arrangements necessary to make this new approach work well.'

Aimed at council finance staff and those who work on personal budgets in adult social care departments, the report provides helpful self-assessment checklists to measure progress and highlight areas for improvement.

Councils taking part in the Commission's research gave examples of how personal budgets are starting to make a positive difference to people's lives. However, many councils have a long way to go to match the progress of leading ones.

The report warns that some will need to make 'a significant effort' to achieve the milestones agreed in 2009 between the Association of Directors of Adult Social Services (ADASS), the Local Government Association (LGA) and Department of Health. These say that at least 30 per cent of eligible social care users, or their carers, should have a personal budget by next April. An ADASS/ LGA survey this year showed only 6 per cent of total spending on adult social care has been allocated to personal budgets – around £900 million across 170,000 people.

Another area of concern is that councils have less well-developed personal budget approaches for people with mental healthcare needs. Several did not provide them at all, despite evidence that mental health service users would be major beneficiaries of the policy. Existing joint arrangements, such as pooled funds with a primary care trust or mental health trust, are not flexible enough to adapt to personal budgets.

Andy McKeon adds:
'The rationale behind personal budgets is not saving money, but empowering service users. Personal budgets mean personal choice. They can improve health, wellbeing and user satisfaction. There may be some savings where councils have ended up with high-cost care packages as a result of poor commissioning. But the growth in personal budgets puts block contracts and in-house service provision at risk, as a result of the freedom to choose from different services and providers.
'Introducing this radical change in the funding of social care is a challenging, and ongoing, process. Our report gives case studies of councils that are rising to that challenge, and making it work for the benefit of their residents.'

Notes to editors

1. A personal budget is an allocation of money given to a person to spend on an adult social care support plan. The personal budgetholder develops their support plan with social care professionals to meet a jointly agreed set of needs and outcomes.
2. Holders decide how to spend their budget in ways they think will achieve their agreed outcomes.

Personal budgets can be:

  • managed by the holder (through his or her bank account to spend as they choose to meet the outcomes agreed in their support plan);
  • by the council or a third party,
  • through an Individual Service Fund (ISF) where an independent care provider, family member or friend spends the budget for the holder to meet the outcomes in the support plan; or
  • through a combination of these methods.

3. View the full report at http://www.audit-commission.gov.uk/personalbudgets

4. The Audit Commission is an independent watchdog, driving economy, efficiency and effectiveness in local public services to deliver better outcomes for everyone. Our work across local government, health, housing, community safety and fire and rescue services means that we have a unique perspective. We promote value for money for taxpayers.

On 13 August 2010 the Secretary of State for Communities and Local Government announced that he plans to disband the Audit Commission. His intention is to have new arrangements in place for auditing England's public bodies by 2012/13

For further information please contact: David Rose on 0844 798 6654

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