Gerry Steinberg MPIn the House...

Commons Gate

Ensuring the effective discharge of older patients from NHS acute hospitals (HC 392)

Public Accounts Committee 24 Feb 2003

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SIR JOHN BOURN KCB, Comptroller and Auditor General and MR J LONSDALE, Director, National Audit Office, further examined.
MR ROB MOLAN, Second Treasury Officer of Accounts, HM Treasury, further examined.
REPORT BY THE COMPTROLLER AND AUDITOR GENERAL:
Ensuring the effective discharge of older patients from NHS acute hospitals (HC 392)

Examination of Witnesses

SIR NIGEL CRISP KCB, Permanent Secretary, and NHS Chief Executive and MS DENISE PLATT CBE, Chief Inspector, Social Services Inspectorate, Department of Health, examined.

Mr Steinberg

Mr. Gerry Steinberg (City of Durham): I was interested when you said the problem appeared two years ago. I would put it to you that this bed-blocking problem has been a time bomb waiting to happen since the early 1990s. Would it surprise you to know that I and my colleagues in Durham were so worried about the situation that we asked the county council to call a meeting between all the relevant agencies between Christmas and New Year. Would you find it incredible that when that meeting was arranged, there were people sitting in that room to discuss the problem who had never met each other before?

Sir Nigel Crisp: Firstly, I agree with you that the problem was there before two years ago. What I really meant was that we faced up to it two years ago and put in place some real determination to crack it two years go. You are quite right that the problem has gone back some time. I am depressed to hear the statement you make about the people responsible for working together not having met before. One of the things which has happened in the last year and a half, since we have had primary care groups and social services people have been specifically within the health structure, is that this is helping to make sure that things such as you have just talked about -

Mr. Gerry Steinberg (City of Durham): As a matter of interest, how many times have you and Ms Platt met over the issue?

Sir Nigel Crisp: About once every fortnight I would have thought.

Mr. Gerry Steinberg (City of Durham): I am surprised they are in the mess they are in.

Sir Nigel Crisp: This is why we have been improving. I ought to point out that Ms Platt is on my board and this is an issue which is talked about at the highest level.

Mr. Gerry Steinberg (City of Durham): If we look at the history of the whole thing, it is incredible that it has ever been allowed to happen in the first place. I want to make it clear that I am not talking about the director of social services for Durham; I want to make that quite clear. When I spoke to quite a senior director of social services about the problem he said that the NHS and Community Care Act of 1993 was set up to fail and it was a bastard of a job. What do you think he meant by that?

Ms Platt: As I was a director of social services at the time of the NHS and Community Care Act being brought in, I have some sympathy for the comment which was around ensuring that the proper assessment processes were put in place for older people living in the community and using money which was in the social security system in a different way to support those people to live in the community rather than necessarily in an institutional setting.

Mr. Gerry Steinberg (City of Durham): What was the big difference?

Ms Platt: I suspect what he was getting at was that it was moved from an open-ended budget to a cash-limited budget.

Mr. Gerry Steinberg (City of Durham): In other words, what we are talking about is that pre-1990 we had a system where social security, the benefits system, paid regardless for any old person to go into a home, no questions asked, no cash limits at all, low dependency, they went in. Then suddenly, overnight, the system was changed because the government realised that it was costing a fortune, they could no longer afford it and they changed it to a high dependency cash restricted local authority system. What then happened?

Ms Platt: It was not totally that way, as I recollect it.

Mr. Gerry Steinberg (City of Durham): I think it was. I remember because I was here at the time. Go on.

Ms Platt: Directors of social services, and a director of social services in your part of the country, Brian Roycroft, were arguing very significantly that the money could be better spent and that older people only had one choice, which was to go into residential care. If that money were used differently to help support people in the community, it could be used to best effect. Local authorities in fact did very well in helping older people to live in the community.

Mr. Gerry Steinberg (City of Durham): I am not criticising the local authorities in the slightest.

Ms Platt: Indeed. I am saying that the system was not so perversely affected as you are painting it.

Mr. Gerry Steinberg (City of Durham): What was the result of a cash free system?

Ms Platt: A cash free system was that a lot of older people ended up in residential care when they might not have.

Mr. Gerry Steinberg (City of Durham): Who provided the residential placements?

Ms Platt: The independent sector primarily.

Mr. Gerry Steinberg (City of Durham): Exactly and they made a fortune, did they not?

Ms Platt: I could not possibly comment.

Mr. Gerry Steinberg (City of Durham): Of course you could. You know very well they did. They made an absolute fortune, did they not?

Ms Platt: I really do not know the answer to that question.

Mr. Gerry Steinberg (City of Durham): They opened hundreds of homes, thousands of beds were created. Then what happened when the new system came in?

Ms Platt: The new system which came in was intended to get older people -

Mr. Gerry Steinberg (City of Durham): They were assessed, were they not?

Ms Platt: Yes.

Mr. Gerry Steinberg (City of Durham): And coming from low dependency, they became high dependency and therefore the people who got into the homes were no longer low dependency, they were high dependency, because local authorities could not put just anybody in.

Ms Platt: Yes.

Mr. Gerry Steinberg (City of Durham): What happened? They could not get the profits they were making previously and we lost a lot of beds, did we not?

Ms Platt: We have lost a number of beds because of the non-increase in fees which has meant that a number of care homes have been struggling because of low fees and inability to attract staff where there is full employment.

Mr. Gerry Steinberg (City of Durham): Why could they not attract staff?

Ms Platt: Why can they not attract staff now? Because in a situation of full employment it is quite difficult.

Mr. Gerry Steinberg (City of Durham): Why was it easier to run a residential home pre-1993?

Ms Platt: I really do not know why it was easier.

Mr. Gerry Steinberg (City of Durham): It is quite easy, quite obvious. You have a situation with low dependency, people did not need the care and staff could be employed at 2.50 an hour to look after them, as nursemaids. Eventually when the government said you had to assess people and they could not just go into a home, nursing homes had to start to attract proper staff and pay them decent wages and they started to close because they were not making the profits. That is how we lost so many beds and that is why we have the situation we have today. Let us move on. At the time transitional grants were given, were they not?

Ms Platt: Yes.

Mr. Gerry Steinberg (City of Durham): What were those transitional grants able to do at the time?

Ms Platt: The transitional grants were to ensure at the time that the independent sector was not destabilised. So 85% of it has to be spent in the independent sector.

Mr. Gerry Steinberg (City of Durham): Were those transitional grants continued?

Ms Platt: No.

Mr. Gerry Steinberg (City of Durham): What happens then, when they are not?

Ms Platt: The transitional grant was not continued because the amount of money was absorbed in the base line of the local authority. The money did not disappear, it went into the base line.

Mr. Gerry Steinberg (City of Durham): Looking at the history of it, the point I am trying to make is that this has been a time bomb waiting to explode over ten years. Frankly, neither the health service nor social services have had the nous to realise this was going to happen, yet the director of social services I spoke to told me that he knew this was going to happen, it was so obvious it was going to happen and was going to create problems. It seems to me that nobody had a strategic plan to stop it happening. Am I right or am I wrong?

Ms Platt: I suspect it is a point of view.

Mr. Gerry Steinberg (City of Durham): I want your point of view.

Ms Platt: I do not think it is as bald as that. Managing the market as a director of social services at the start of the community care legislation there was indeed a very substantial sector which did need to be managed. It is very different managing a market now, where the market is diminishing. Different sorts of partnerships with the independent sector are what is necessary.

Mr. Gerry Steinberg (City of Durham): One of the obvious solutions to me is to ensure that social services are adequately funded. Would you agree?

Ms Platt: Yes.

Mr. Gerry Steinberg (City of Durham): Last year my local authority had an appalling settlement for social services. This year under the new FSS, or whatever it is called, they have an even worse settlement, something like 4.8%. You said that if we had problems about that we should contact the Office of the Deputy Prime Minister, but I say to you that you are chief inspector of social services and it is no good passing the buck and saying it is nothing to do with you. The fact of the matter is that if you are the chief inspector. In my view you should be going to the Office of the Deputy Prime Minister and saying, "Look, John", because I am sure you are on first name terms with him, "There's just not enough money going into social services. These local authorities are not able to carry out the duties they are supposed to do. You say you are giving them a load of money but they are not getting it". My local authority is not getting it. I do not know where it is going but it is certainly not coming to Durham. Do you tell John Prescott this?

Ms Platt: I think my answer was that if you want to go into the technicalities of floors and ceilings you will need somebody who is technically more au fait with that system than I am. I certainly agree that it is part of my role to say how social services use their money and I would point you to my annual report of two years ago, where I did point out to Ministers the discrepancy between the funding settlement in the NHS and in social services and that you could not expect partnership to happen when there was such a discrepancy in funding between services. I have actually pointed that out to Ministers and when I see how social services are going to use the money they have allocated to them, I shall make comment on it.

Mr. Gerry Steinberg (City of Durham): Good; I am delighted. Appendix E of the report seems to indicate to me and support the argument I have been making. We are told that there is an extra 1 billion being put into social services by the end of 2006, but if we look at Appendix E it clearly seems to me that this does not add up and less money is actually going into this section. How on earth can the problems be solved, unless I am reading this wrong? How can the problems be solved if social services departments are not getting enough money and not enough money is going into solving the problem?

Ms Platt: Social services need to demonstrate that they are actually making best use of the resources they have available. If all social services were performing at the level of the best, we would be able to tell what that gap is in funding that you infer.

Chairman: Thank you, Mr Steinberg, for a very effective historical analysis of this problem. Perhaps your questions should be an appendix to our report. They were very useful.

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Mr Steinberg

Mr. Gerry Steinberg (City of Durham): May I return to Appendix E? In the building care capacity grant for 2002-03 and 2002-02 in the first year 90 million was allocated then 190 million was allocated. It seems to me that money was given specifically to local authorities to get rid of bed blocking, to pay for residential care and what have you. It was a very small payment in 2002 and then a bigger payment in 2002-03, then it does not occur again in 2003-04. Explain to me how local authorities, who have made a commitment to pay for residential places to perhaps release 30 people out of hospital into residential places, then in the next year have that same commitment because those people are in care homes, find the money to keep them in those care homes?

Sir Nigel Crisp: It is in the base. It is translated out of being a specific grant into being part of the base line allocation to social services.

Mr. Gerry Steinberg (City of Durham): But the base does not increase. The base increases a minimal amount. You create even further problems because you have given money to release them from the bed, to go into a care home and then the base does not increase enough to keep them in the care home.

Sir Nigel Crisp: Forgive me, that was the argument we had in the autumn of 2001 when we produced this money. I cannot remember the exact context, but I was involved in it. It was saying that for the next six months we are going to produce 100 million and because we know of this problem, we are going to make it recurrent. So it was 90 million in the first year and then we added another 100 million in the second year to make it 190 million and then we put it in the base so that it was recurrent money. That was precisely the set of arguments we had at that time in order to be able to sustain looking after these people.

Mr. Gerry Steinberg (City of Durham): The point Geraint Davies was making was that if your base is so low to begin with and it does not increase enough to sustain the care homes you purchased the previous year, how do they manage?

Sir Nigel Crisp: I have to say we were responding to the argument which had been put to us which was that we needed to make this money recurrent and not as a special one-off grant and that is what has actually happened with that money.

Mr. Gerry Steinberg (City of Durham): You say that and you give us that explanation, but I do not think in reality it is accurate. I am not calling you a liar, I just do not think local authorities have that money in the base. He got 3.5% in Croydon, I got 4.8% in Durham. We needed at least 6% and we did not get it. In fact you have created further problems.

Sir Nigel Crisp: I have to say that we get the opposite argument as well, that they do not want ring-fenced money, they want money in the base. That is the argument we hear all the time from local authorities. Let us be clear about that.

Ms Platt: Nationally the social services resources did increase in real terms on average for the next three years by 5.7%: 6.3% in the first year, 4.5% in the second, 6.3% in the third. How the new formula has disaggregated that to individual councils is what your debate has been about. Nationally the pot did increase.

Mr. Gerry Steinberg (City of Durham): Some local authorities must have done extremely well.

Ms Platt: Some local authorities have done well, but what you have been raising is more an issue of the new formula for distribution rather than the size of the national pot for social services which did increase very substantially.

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