Financial and workforce challenges for social care in Scotland

Two new reports again highlight the problems facing social care in Scotland but offer few indications that a credible solution is on the horizon. 

The Accounts Commission annual overview of local government is rarely a cheery read. It again highlights how the Scottish Government has dumped austerity onto councils with 7.6% real-terms cut since 2013/14. This compares with a 0.4% cut to other budget areas. An increasing proportion of this reducing budget is also committed to central government priorities – a long way from the promise to end ring-fencing!

This year’s report pays particular attention to health and care integration. The Chair’s foreword summarises his concerns:

“Of particular note for us this year, Integration Joint Boards (IJBs) continue to

 face very significant challenges and they need to do much more to address

 their financial sustainability. The pace of progress with integration has been too slow and we have yet to see evidence of a significant shift in spending and services from hospitals to community and social care. I continue to be concerned about the significant turnover in senior staff in IJBs. This instability inevitably impacts on leadership capacity and the pace of progress.”

Unsurprisingly, a majority of IJBs struggled to break even. Without additional funding from partners, 19 IJBs would have recorded a total deficit of £58 million. 14 IJBs had not agreed on a budget by the start of the financial year, and half had unidentified savings. The projected funding gap for next year is £208m. This is reflected beyond next year in the medium-term financial strategy which shows increased demand for social care costed at £683m by 2023/4.

Many IJBs have highlighted workforce issues as a high-risk area, and not just at a senior level. The Scottish Government and COSLA have finally published an integrated health and social care workforce plan. This is long overdue, but in fairness at least there is one, along with a recognition that workforce planning is not an exact science.

The headline estimate is that Scotland will need 20,000 WTE more health and care employees in the period up to 2023/24, which they hope will be reduced by up to 10,000 WTE through mitigating actions like efficiency savings (cuts), technology and redesign. 

The significant number is over 14,400 home care staff, a group that is likely to be heavily impacted by Brexit and the UK government's immigration policies. This is a sector that already has high turnover rates. The overall vacancy rate in social care is almost twice the Scottish average.

Analysis and scenario planning is fine, but the real test of workforce planning lies in action. The principal plans appear to be: 

• Growing the numbers of staff in training. This is particularly important for the NHS, where most staff groups require formal qualifications. This includes a focus on community-based and mental health staff, which is essential if there is to be a meaningful shift in care from hospitals to the community.
• For other groups, the focus is on retaining the existing workforce, encouraging returners and widening access to the sector. Creating better career pathways and implementing the Fair Work Framework are essential initiatives.
• Pay is recognised as a critical issue. To say that ‘there have been some challenges in implementation’ of the Real Living Wage is something of an understatement! Sadly, there is little sign of any plan to address this.

Overall, the plan is again stronger on process than action. The NHS element has well-established workforce planning and some detailed plans to address shortages. There is at least a welcome aim to elevate workforce planning into a whole system position.

The weakness is in the social care sector. The fragmented, and at times chaotic, social care system in Scotland is in major need of reform. I fear that without that reform, we will again be looking at evaluation reports which highlight workforce gaps and financial problems for years to come.

Focusing on energy and the climate emergency

I see in The Herald that ScottishPower chief executive Keith Anderson said Labour promises to take back control of Britain’s energy network meant “losing focus” on the issue of tackling the climate emergency. I appreciate that the policy may impact on ScottishPower’s profits, which won't go down well with the company's Spanish owners. Still, Labour is very much focused on the climate emergency and reforming the failed energy market system is essential to that task. 

By common consensus across the environment lobby, Labour's Green Industrial Revolution is a shift change in political action on climate change. The key to this is the £250 billion Green Transformation Fund dedicated to renewable and low carbon energy, transport, biodiversity and environmental restoration. This investment will enable the Scottish Parliament to adopt more radical climate change targets and action plans, including retrofitting almost all of Scotland’s 2.6m homes to the highest energy standards.

You might have thought that Keith Anderson would have welcomed the new wind farm capacity (7000 offshore and 2000 onshore wind turbines), 60% of which will be in Scotland creating around 20,000 new jobs. It might be a little easier persuading the often cash strapped Iberdrola board in Spain to invest if there is government investment as well. Particularly when the government can borrow so much more cheaply than energy companies.

Of course, Labour will link this to a new industrial strategy, which, unlike almost all ScottishPower wind farms, will link investment to jobs in the UK. The shift to renewable energy is welcome, but there has been no Just Transition for workers in the industry and the supply chain. That is a failure of the UK and Scottish governments, and all power companies, including ScottishPower.

ScottishPower’s primary concern is Labour’s plan to bring UK energy systems into democratic public ownership, including those run by ScottishPower. This means the current profits will be reinvested or used to reduce bills, rather than being sent to Iberdrola in Spain. 

Citizens Advice estimated that over eight years network companies would make £7.5 billion in unjustified profits. The Committee on Climate Change also identified higher network costs as a key reason UK business have faced higher electricity bills than European competitors.

Public ownership will secure democratic control over nationally strategic infrastructure and provide collective stewardship for vital natural resources. This will help deliver Labour’s ambitious emissions targets. Private network companies and the toothless regulator Ofgem have failed to upgrade the grid at the speed and scale needed. In contrast, publicly owned networks will accelerate and coordinate investment to connect renewable and low carbon energy as they have done so successfully in other European countries, most notably Denmark. Only two countries in Europe have fully privatised electricity – UK and Portugal (Portugal because of EU austerity imposition). That’s because they understand the importance of democratic control of grid access.

Public ownership will also end the expensive regulatory system which involves armies of economic regulators in Ofgem and the power companies. As someone who represented energy workers for years, I have seen the waste that this system creates, all ultimately paid for by consumers.

Interestingly, Keith Anderson didn’t appear to be as exercised over the nationalisation of ScottishPower’s supply arm. The current supply companies are not profitable and have increasingly sought to reduce costs by offshoring jobs and cutting corners with customer service - as evidenced by consumer surveys. SSE has already sold off its supply business and Npower is effectively closing its business. I have long argued that the Scottish government should offer to take over ScottishPower’s supply arm rather than set up its own company. I suspect that might get the favourable attention of decision-makers in Bilbao.   

The so-called energy market has led to higher costs, consumer confusion over tariffs, and discrimination against low income pre-paid meter customers. Labour will create a green army of workers focused on energy efficiency, not selling energy in a flawed and false market. Just compare the confusion of the smart meter rollout with the way North Sea gas conversion was achieved in the 1970s. 

I’ll end by quoting Brian Wilson, the best energy minister I have ever worked with. He recently said: 

“In meeting the climate emergency, it is the state that must step in. It is government which needs the power to determine a response, rather than be in the supplicant position of asking a whole range of players if they would mind adjusting their priorities, please.”

Labour’s plans may not be well received in some corporate boardrooms, but they are very much focused on tackling the climate emergency for the many, not the few.