Delays to phase two of the Care Act 2014

The Care Act 2014 received royal assent on 14 May 2014, with the Department of Health planning to implement the Act in two phases.

Several significant changes to duties on local authorities were introduced from April 2015 in 'phase one', including to:

  • meet a national minimum level of eligibility for an individual’s care and support needs
  • offer deferred payment or loan agreements to more people
  • comply with a new legal framework for protection of adults at risk of abuse or neglect.

The government had then planned that the legislation for reform of the funding system would come into force from April 2016 in 'phase two', including the following main changes to:

  • introduce a maximum cap on the amount an individual would have to pay towards their care and support for people aged 65+ (set at £72,000), regardless of means. This was based on a recommendation from the Dilnot Report in 2011 'to protect people from extreme care costs'
  • make the capital limits more generous, increasing the means-test threshold – above which people start to contribute towards care costs – from £23,250 to £118,000 for care home residents and to £27,000 for others.

On 17 July 2015, the government announced that it would delay the phase two reforms until April 2020, though it remained ‘firmly committed to delivering this historic change’. Explaining the decision to delay, the government cited the expected £6bn cost to the public sector at ‘a time of consolidation’ and noted the ‘genuine concerns raised by stakeholders’, specifically citing a letter sent to the Secretary of State for Health Jeremy Hunt by Izzi Seccombe on behalf of the Local Government Association (LGA). In the letter, Seccombe had ‘reluctantly’ suggested the delay to the legislation ‘with the money earmarked for the capped cost system instead put into the social care system itself’, given that ‘local government funding will again be under enormous pressure in the coming years as Departments make considerable savings as part of the Government’s deficit reduction plan.’

The Government also postponed introducing local authority ‘brokering’ on behalf of self-funders wishing to move into a care home, and the new appeals system.

The House of Commons Public Accounts Committee (PAC) published a report in December 2015 on phase one of the Care Act reforms and new burdens on local government. The report stated that the government had not been ‘sufficiently open and transparent in identifying and assessing new burdens on local authorities (like the Care Act) or reviewing their impact’. Regarding phase two, PAC recommended that the Department of Health ‘develop a properly resourced plan for the implementation of Care Act Phase 2, including a clear timetable.’

Indefinite postponement

On 7 December 2017, the government announced further delays to the phase two of the Care Act 2014 reforms. In an oral statement to the House of Commons, Under-Secretary of State for Health Jackie Doyle-Price formally dropped April 2020 as the date for implementing the adult social care funding reforms 'to allow for fuller engagement and the development of the approach, and so that reforms to the care system and how it is paid for are considered in the round'. The government did not announce a new date, but reaffirmed its commitment to a  Green Paper setting out options for adult social care funding reform (first announced in the Spring Budget 2017).

Source(s)

Lord Prior of Brampton.
Cap on Care Costs: Written statement.
Parliament; 2015.

Jarrett T.
Social care: Announcements delaying the introduction of funding reforms (including the cap) (England).
Parliament; 2018.

National Audit Office.
Care Act first-phase reforms.
National Audit Office; 2015.

House of Commons Committee of Public Accounts.
Care Act first-phase reforms and local government new burdens.
HMSO; 2015.

House of Commons.
Social Care: HC Deb, 7 Dec 2017, Vol 632, CC 1235.
Hansard; 2017.