Proposals relating to changes to the way in which contributions towards non-residential Adult Social Care costs are calculated

What is the current situation?

The County Council assesses a person's needs for care and support under the Care Act 2014, and then ensures their eligible needs are met. Where needs are met via non-residential care (services that people receive at home or in the community), this is funded either by the County Council, by individuals themselves, or by a mix of both.

The amount someone in Hampshire currently pays towards their non-residential care and support is 95% of any assessable (remaining) income once standard outgoings are paid for (such as mortgage/rent, council tax, and any Disability Related Expenses [DRE]), and once an allowance is made for general living costs such as food, utility bills and clothing (see Paying for care at home). This allowance is set by central Government based on the client's age and other circumstances and is known as the Minimum Income Guarantee (MIG).

This financial assessment places people into one of three groups:

  1. Those that are not required to make a contribution to their care costs – this is where an individual does not have sufficient assessable income to contribute to their care.
  2. Those who make a contribution to their care costs – this is where 95% of an individual's assessable income is not enough to cover the full care costs so the Council also contributes to the cost of care.
  3. Those that should fully fund their own care – this is where the individual pays the full cost of their care, either: a) because the care cost is lower than 95% of their assessable income, or b) the individual has been assessed as having enough capital and income to fund their own care.

Up-to-date information and guidance on our website provides individuals, families, carers, and representatives with further information on charging arrangements. See Financial assessment.

The financial assessments for individuals in residential and nursing care are undertaken through a separate assessment process which takes into account other factors such as the individual's home. 100% of an individual's wealth and income is taken into account for this assessment. This is not within scope of this consultation.

Example: calculation of current contribution

Standard weekly income and benefits   Allowances including MIG and DREs     Current weekly contribution at 95%
£250.00 Minus £181.95 ×95% = £64.64

What is being proposed?

We are proposing to increase the amount someone pays towards their non-residential care and support from 95% to 100% of any assessable income once standard outgoings are paid for and the Minimum Income Guarantee (MIG) allowance is taken into account.

Doing this would save the County Council around £500,000 per year.

Why is this being proposed?

Until a sustainable long-term national funding solution can be found to address the intense financial pressures facing not only the County Council, but also wider local government, we have no choice but to consider changing or reducing services in some areas and propose options for savings.

Proposals relating to changes to the way in which contributions towards non-residential social care costs are calculated would contribute towards addressing the County Council’s overall anticipated £132 million budget deficit from April 2025.

The Care Act 2014 allows a charge of 100% of assessable income towards non-residential care costs. Within Hampshire, other care groups in residential and nursing care already have 100% of their assessable income taken into account in their financial assessment. Other local authorities, including West Sussex, Portsmouth and Southampton, already take account of 100% of assessable income for all financially assessed individuals. This proposal therefore creates an equal and consistent approach to financial assessments and charging across all Adult Social Care groups and brings Hampshire County Council in line with other authorities.

Making this proposed change would lead to an increase in client contributions, and a reduction of the County Council’s contribution to individuals’ care and support costs. Based on current clients, this reduction is estimated as being around £500,000 per year.

How would the proposal be implemented?

If approved, the change would be introduced by April 2025 for all new financial assessments and in annual reviews for current clients from April 2025 onwards.

What are the potential impacts?

The proposal would impact Hampshire residents who are financially assessed as needing to contribute to their non-residential care. These people could see their care charges increase in line with the revised calculation. Individuals who currently pay the full cost of their care may be affected in future if their income and/or assets reduce to the point that they are only required to contribute towards the cost.

Based on data from June 2023, these changes would impact approximately 4,000 people who currently contribute to the cost of their care and support through our services. As this table shows, the majority of these people would pay up to £4 a week more for their care and support.

Additional weekly cost increase Number of individuals affected by this level of increase Percentage of individuals affected by this level of increase
£0.01 to £4.00 2,716 67.5%
£4.01 to £10.00 1,186 29.5%
£10.01 to £20.00 110 2.7%
£20.01 to £30.00 11 0.3%
£30.01 to £40.00 3 0.1%
  4,026  

The next example provides an illustration of the new calculation, using the average increase of £3.41 extra per week.

Calculation of proposed contribution

Standard weekly income and benefits   Allowances including MIG and DREs     Proposed weekly contribution at 100%
£250.00 Minus £181.95 ×100% = £68.05
    Contribution @ 95%   = £64.64
Proposed increase to weekly contribution of £3.41

Given that we would continue to use a nationally recognised formula and the proposal is in line with other local authorities, it is not anticipated that these changes would cause undue financial hardship for service users.

What alternatives have been considered?

There are other approaches that we could take that are not proposed at this time. In developing this proposal, we have also considered the following:

Maintain current level of client contribution

This option is not being proposed because of the scale of the budget pressures faced by the County Council, and the legal requirement to operate within budget. If we maintained the current level of client contribution, it would put additional pressure on other statutory or critical services to deliver increased savings. Statutory services are those we are legally required to provide. This may impact levels of service in these areas and our ability to operate within our budget.

Propose a lower level of percentage increase

This option also does not contribute sufficiently to our savings programme and the financial challenges of the years ahead.

Reducing the number of permanent staff employed directly by Adults’ Health and Care

The directorate has considered reducing the number of permanent staff employed directly by Adults’ Health and Care. However, to make the same amount of savings, we would need to terminate the contracts of a considerable number of staff. This would limit Adults’ Health and Care’s ability to meet its responsibilities set out in the Care Act 2014.