1. Context

1.1 Supporting People (SP) was implemented in April 2003 to fund the housing related support needs of approximately 20,000 service users in Hampshire. 70% of SP users are older people living in sheltered housing, where SP funds the warden service. Other user groups include People with Learning Disabilities, the homeless, women fleeing domestic violence, offenders, and vulnerable young people.

1.2 Following an "Independent Review" the Office of the Deputy Prime Minister (ODPM) has reduced the national Supporting People pot from £1.8b to £1.7b.

1.3 In addition the Government is planning to introduce a distribution formula for SP. Exemplifications published on the ODPM website reveal that the Hampshire allocation could be significantly reduced after 2007/8

1.4 Hampshire's SP budget has faced year on year reductions since the beginning of the programme in April 2003, and this is set to continue until 2006/7 and possibly beyond.. In April 2003 the Hampshire budget stood at £34,000,000 and has now been reduced to £31,500,000.

1.5 A financial strategy has been put in place which aims to achieve a balanced budget in 2005/6 and 2006/7. With the probable introduction of the distribution formula further reductions are needed to balance the budget in 2007/8 and beyond.

1 The Supporting People Distribution Formula

2.1 The ODPM proposals for the distribution formula (SPDF) are to be published in May 2005. The formula has yet to be agreed, but early drafts of it have been used to determine allocations for 2005/6 and 2006/7.

2.2 Although the overall intention is clear, minor changes to the formula can make a significant difference to the amount that Hampshire receive, and plans are being made with a large degree of uncertainty. Exemplifications on the ODPM website indicate that Hampshire's budget will reduce from £33.4m in 2004/5 to around £20m, albeit over an unspecified period of time.

3.2 The government has given us "target allocations" for each cluster of user groups but each version of the formula tends to give different outcomes. For instance, whereas "Disabilitaties" at one point stood at £2.9m, a change in the "at risk" driver then increased it to £7.5m. It is probable that this will change again.

3.3 The impact of the current proposals is a major redistribution of funds from the South of England to the North, particularly the North East. The major cites lose out with funding being redistributed to suburban areas. Rural areas lose out significantly as little weight is given to the additional cost of providing services over a large area.

3.4 A meeting of County Councils regarding the distribution formula agreed that Counties should do all within their power to challenge the formula and its implementation. In terms of the formula itself, the prevailing view was that it should be challenged but, in reality, all the arguments have already been aired, and bar some "tidying up" it was unlikely that new persuasive arguments are going to appear.

3.5 County Councils may have more impact with ODPM by demonstrating that the impact of implementation will be severe, poarticularly on homelessness services. Government target allocations give Disabilities 37.5%of the £20m overall pot.. This is a 40% reduction in actual spend but not as much as earlier drafts had suggested, which would have left us at 15% for Disabilities. The inevitable outcome will be large reductions in funding for homelessness and older people. The Target Allocation for older people suggests a 40% reduction.

4 The County Council Network (CCN)

4.1 Hampshire will be working with other County Councils, through the County Council Network (CCN). Overall, Counties lose around £138m under the formula. Southern Unitary Authorities also lose but it was thought that setting up a group of authorities whose only common factor is that they lose out would be less effective as a medium for combating the successful lobbying of the Core Cities Group (CCG).

4.2 One example of the Counties commonality of interests is that the CCG are still lobbying for density to be included as an additional needs driver. If this were to happen it would make Counties situations far worse but may help southern urban authorities.

4.3 Under the CCN, County AAs will collate information on the impact of the funding reductions. It is inevitable that reductions and closures are more likely to concentrate on floating support and other short term services, including homelessness and direct access. these are easier to close than long term accommodation based services.

4.4 The CCN has produced an analysis of the allocations formula produced by ODPM and an analysis of the allocation if the Department of Heath Formula Spending Share (FSS) was applied. Hampshire would see its budget reduced by £118,000 rather than the significant reduction under ODPM.

4 Impact On Social Services

4.1 Approximately twenty per cent of SP service users are clients of the Social Services Departrment who also have a funding responsibility. Reductions in SP funding opf this magnitude will inevitably have an impact on Social Services expenditure.

4.2 This will be significant but due to the complexity of the interaction between the two cannot be quantiifed at present. The Social Services Department will need to ensure that the impact is minimised from both a financial and service user perspective. This impact will be reported as appropriate.

4.3 There are a number of reasons why this may happen. In the lead up to SP, between 2000 and 2003 a new category of eligibility for Housing Bbenefit was created, Transitional Housing Benefit (THB). This provided an opportunity for many people with support and care needs.

4.4 In many cases people were able to move out of institutional accommodation to their own homes funded both by Social Services and Supporting People. This was particularly the case for people with Learning Disabilities. 83 Residential Care Homes de-registered enabling residents to become tenants and claim THB.

4.5 The reductions being envisaged by the ODPM could have a severe impact on the Departments ability to implement Valuing People, which encourages a diversity of accommodation and support to enable people with Learning Disabilities to live as independently as possible.

4.6 While it is true that a reduction in SP funding could impact on the Social Services Learning Disability budget, it should be remembered many other Social Services client groups could lose services, or funding as well. These include older people, people with mental health problems, vulnerable youg people, and people misusing drugs and alcohol.

5 Legal and Constitutional Issues

5.1 Supporting People is a partnership between Hampshire's eleven district councils. the County Council, Health, and the National Probation Service, all of whom are represented on the County Core Group. The programme is administered by the County Council through the Social Services Department.

5.2 Each agency on the Core Group holds one vote, and all votes must be unanimous. If the Core Group votes for a measure that would result in the Suppiorting People budget overspending, that decision can be overruled by the Administering Authority. The Administering Authority also exercises one vote concerning the policy and strategy of the programme.

5.3 Consequently, the County is responsible for the management of the budget whereas the Core Group is responsible for the direction of funding within that budget.

5.4 The County Council also holds contracts for nearly one thousand SP services. The reduction in Hampshire's budget therefore puts at risk the County Council's ability to honour its contractual obligations.

5.5 In additionthe County could be open to a series of legal actions including Judicial Review. The County is already subject to one Judicial Review following the first round of service reviews and budget reductions

6 Conclusions

6.1 SP remains a positive initiative which provides opportunities for many thousands of vulnerable people to live independently, receiving the support they need, in housing and accommodation of their choosing.

6.2 The programme in Hampshire is under threat from the overall reduction but even more from the distribution formula. The SP Team intend to work with other affected SP teams to do all that is possible to ensure that the present proposed distribution formula is not implemented.

6.3 Race Relations (Amendment) Act: The Government Regulations and Inspection arrangements specify requirements concerning racial (and other forms of) discrimination. Compliance with the Act in terms of carrying out an Impact Assessment is confirmed, forming part of the programme of work relating to the Department's Service.

6.4 The Supporting People Five Year Strategy supports Corporate Aims 1, 4 and 5: Maximising life opportunities, building strong and safe communities and improving services, by providing support services to vulnerable people to increase their independence and enabling older people to live independently for longer in their own communities working in partnership with health agencies, District Councils, the Probation Service and voluntary bodies by promoting continuous improvement in the quality of services, improving the way in which we communicate about SP services and continuing to promote effective and prudent financial management.

Recommendations

1. 1 That the Policy and Review Committee receive this report.

1.2That this issue returns to the Policy Resources Committee once the public consultation for the distribution formula has been announced.

Section 100 D - Local Government Act 1972 - Background Documents

The Following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works

2. Documents which disclose exempt of confidential information as defined in the Act.

None