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The Minister of State, Department of Health (Mr. John Hutton): I congratulate the right hon. Member for North-West Cambridgeshire (Sir B. Mawhinney) on securing a debate on the funding of social services
I am particularly grateful to the right hon. Gentleman for his appreciation of the work of the social services inspectorate in Peterborough. It is doing a good job, and is working closely and, I think, successfully with the local authority--as it has for some time--in trying to address the complex and difficult issues to which the right hon. Gentleman so skilfully drew attention.
Given the right hon. Gentleman's experience as a former social services Minister, I am sure that he will agree with me, at least in part, when I say that social services perform crucial functions. Those functions include child protection, on which the right hon. Gentleman dwelt; but social services also have a role in caring for elderly and disabled people. I hope the right hon. Gentleman would acknowledge that they also help us to confront some of the consequences of social exclusion and deprivation which, sadly, still scar the lives of many of our fellow citizens.
Those tasks involve big responsibilities. I believe it is our job as parliamentarians to ensure that the services are properly resourced, and operate within a legal and policy framework that successfully promotes independence and opportunity and delivers the high standards that the public have a right to expect. I can say confidently that the Government have acted both to increase the overall resources available to social services departments, and to set out clearly the new framework within which social care should be delivered.
I shall deal with both those issues in more detail later, as well as responding to the points that the right hon. Gentleman has raised--quite fairly--about the situation in Peterborough. Let me begin by dealing with his concern about social services funding. The right hon. Gentleman--again, very fairly and accurately--tried to explain the historical situation, and I shall not quibble with his description of events; but let me say, as he would expect me to, that the Government have given Peterborough council substantial extra resources in recent years.
The overall level of resources provided for social services this year increased by 4.4 per cent., which is significantly more than the rate of inflation. That followed a larger increase of 6.1 per cent. in the previous year, 1999-2000. On a like-for-like basis, social services resources for Peterborough will, as the right hon. Gentleman said, rise by 4.5 per cent. next year. I shall explain the arithmetic in a moment.
Those extra resources form part of a wider national picture, to which the right hon. Gentleman referred. The spending review announced earlier this year provides increases in resources for councils with social services responsibilities of, on average, 3.4 per cent. per annum in real terms over the next three years. That compares very favourably with an average real-terms growth in social services resources of just 0.1 per cent. per annum during the lifetime of the last Parliament.
Next year--2001-02--the council's core resources for personal social services will increase by 4.5 per cent. Peterborough will also gain from considerable increases in new and on-going special grants. In particular, the children's grant--which we have yet to confirm--will
The right hon. Gentleman was mainly concerned about children's services, but at the end of his speech he mentioned the implications of overspending on those services for adult services. That is a fair point; but he probably knows that the Secretary of State for Health announced on 4 December that £100 million of new resources--on top of the local government financial settlement--would be made available to social services next year. That money is being earmarked for improvements and expansion in social care and rehabilitation services for older people. Peterborough will benefit from an additional £261,000 as a result of that extra funding.
The right hon. Gentleman expressed his concerns about the funding arrangements for implementing the provisions of the Children (Leaving Care) Act 2000, and his uncertainty over how much Peterborough council will receive. The Act, which seeks to improve the life chances of young people living in and leaving care, has been widely welcomed and enjoyed cross-party support in this House and in the other place.
The right hon. Gentleman will be aware that we recently decided to implement those changes from October next year, rather than from April, which was our original intention. We were asked to defer implementation of the legislation by the Local Government Association, the Association of Directors of Social Services and by leading children's organisations. That will give local authorities and their partner agencies the opportunity to prepare properly for implementation.
The provisions of the Act will be funded through a ring-fenced budget to ensure that those very vulnerable young people, who in the past have often had very little support, receive the services that they need and deserve. A ring-fenced budget was proposed in the consultation paper that preceded the publication of the new legislation. All the voluntary sector organisations that responded to the consultation and an overwhelming majority of local councils supported the proposal as the surest way of guaranteeing that appropriate resources reach that group of young people.
The budget will consist of the money currently spent on services for such young people by local authorities and the Department of Social Security together with new resources from the children's grant. Implementing the Act in October rather than April has required changes to be made to the ring-fenced grant. It needs only to cover half the next financial year, not the whole of it. We intend to return to local councils through their standard spending assessments half the funds which were to be transferred into that new ring-fenced grant.
I should make it clear to the right hon. Gentleman that those resources will still be available to support services for these young people. They are not disappearing into some black corner of local government finance, although there are plenty of those. This change has caused some delay in announcing local councils' share of the children's grant, and I regret any uncertainty that that has caused local councils such as Peterborough. I can tell the right
I am obviously aware that Peterborough is experiencing budget pressures in its children's services. The right hon. Gentleman explained the reasons for those pressures very clearly. In 1998-99, the council inherited a spending figure that was 19 per cent. above the standard spending assessment for children's services. In 1999-2000, that had risen to 21 per cent., and the projection for next year is that it will be about 22 per cent.
The problems faced by the council are not entirely due to its financial inheritance. The need to improve financial management, service planning and decision making in children's services also play a part. The council has faced a rising cost from children's placements--the right hon. Gentleman referred to that--that have increasingly been made outside Peterborough council's own area. I understand that in the near future it will carry out an urgent best value review of that area of its work, which will consider the whole range of children's placements, and that it intends to develop professional fostering placements, particularly for difficult to place children. That should enable the council to reduce the use of placements away from Peterborough.
The council has also proposed a budget recovery plan that combines the reduction in the number of out-of-city placements with improved care planning to reduce the overall number of looked-after children, particularly children who are living in their own homes. From a peak figure of 398 looked-after children in May 2000, the current figure has reduced by 40, which is quite a substantial decrease in a relatively short period--almost 10 per cent.
I should like to reassure the right hon. Gentleman that Peterborough is not treated unfairly by the funding system. I know that he was at pains to say that that was not the essence of his argument, but it is worth pointing out that the SSA system is designed to treat all councils equitably. When calculating SSAs, the Government take account of the population, social structure and other characteristics of an authority. The methodology is applied uniformly to all authorities using data that have been compiled consistently across all authorities.
I should also like to mention that the special and specific grants we make available to local councils are allocated on the basis of formulae--often the SSAs--and treat each local council in a similar fashion. The right hon. Gentleman may also like to know that Peterborough has been a net beneficiary of all the major changes to the SSA formula that we have introduced since 1997.
I think that it would be wrong for me to depart from this approach by promising to make a special payment to one council, which could, in the final resort, only be made at the expense of other authorities. I am not sure that I can hold out any prospect for the right hon. Gentleman that I will be able to agree to his suggestion that additional funding of £1.3 million over three years should be made available to the city council.
On the quality of children's services, the right hon. Gentleman is well aware that Peterborough has been the subject of special measures since 1997. That is the result of an adverse SSI inspection of child protection services in Cambridgeshire following the death of Ricky Neave, to whom he referred. After the local government reorganisation in 1998, Peterborough was required to implement the inherited action plan from Cambridgeshire.
Follow-up inspections in March and October confirm that Peterborough social services is now delivering improved protection for children. Quality and consistency are still problematic, but the council is showing substantial progress, and I want to congratulate all those who are working so hard to improve children's services in Peterborough. It does, however, need to improve its quality, personnel and financial management strategies to continue to get the best out of all the resources available to it. The council is currently being reviewed jointly by the SSI and the Audit Commission to determine how well the council serves local people in its social services. The report will be available in spring next year and will have more to say on those issues. When the report is received, the status of special measures will need to be reviewed.
The right hon. Gentleman may be aware that on 10 October I announced the formation of a new adoption and permanence taskforce to help councils achieve a step change in the performance of their adoption services. One of the first visits of the taskforce--last week--was to Peterborough to help the social services authority draw up measures to improve its performance on adoption.
When I met the right hon. Gentleman about a year ago to discuss the situation in Peterborough, he raised particular concerns about recruitment to vacant posts in Peterborough's children's services. Peterborough employs a high number of agency staff, who are very high cost, because of its difficulty in recruiting and retaining permanent staff. That is one of the factors to which the right hon. Gentleman was right to draw attention. He is also right--I am grateful to him for saying this--that my social services inspectors have worked closely with Peterborough on new approaches to recruitment, which have been successful. A new head of service, a new deputy head of service, a newlooked-after children's manager and an intake and assessment manager have been appointed recently. That will all add to the management strength of Peterborough city council.
While those new appointments will strengthen the management arrangements for children's services, work still needs to continue to get in place the required level of social workers and senior practitioners. There is currently a 24 per cent. vacancy level in respect of those posts, and the right. hon. Gentleman and I are concerned about that.
The Department is in continuing discussion with the Local Government Association and others about how we can help local government and other organisations to recruit and retain staff in this important area of our welfare services. We are also making an extra £41 million available to councils in order to provide financial support for training social workers from next year. I hope that that will make a difference to the general difficulties that are experienced by some authorities.
The right hon. Gentleman's concerns have been largely about children's social services in Peterborough, and I understand that. It is worth recording, however, that in relation to adult services, Peterborough has no delayed discharges through funding problems, nor any due to home care capacity. Its best value review of home care has led to more of that service being commissioned from the independent sector. Independent sector home care hours have increased by over 2,800 per week, which has brought savings of £390,000 to the local council, which have been deployed into more intensive care packages supporting people at home.
The council has completed a best value review of residential care leading to active consideration about the future of a number of their own directly provided homes. That is linked to proposals to make more use of sheltered accommodation with an anticipated saving next year of around £110,000.
I am pleased to have had the opportunity to outline our improved financial support to Peterborough and to acknowledge the council's positive handling of its problems in recruitment matters, and its strategies to get a better grip of its children's services budget. Peterborough should draw lessons from the improved use of resources in adult services where its early best value review work has had a positive impact. Applying best value strategies to its children's services will be important to its overall efficiency and quality. We shall continue to scrutinise the quality of the council's services through the work of the SSI and the Audit Commission.