Cuts to Local Authority funding – opportunity for a fresh approach?

The 26% cuts over 4 years to the grants from central to local government announced in last week’s CSR will burn a significant hole in the local public purse, and challenge even the most innovative and well-prepared local authorities to look again at how they can provide consistently ‘more for less’ between now and 2015.

The removal of ringfencing, the development of community budgets and the reduction of targets will be welcomed by many councils, as this will offer the freedom and flexibility they need to bring agendas together internally and externally to produce improved outcomes while reducing spend.

But will they take advantage of these new opportunities?

Age UK has recently been calling for a new cross-council approach to ageing, building the needs of older people into all departmental plans and factoring demographic change into all council budgets.

Too often ageing as an issue gets passed to the adult social care department. However, an Audit Commission report revealed that 85% of people over 65 don’t use council care services, but they do use – and often rely on – the majority of general council services and many use other services such as transport, leisure, and housing.

With growing numbers of older people in all but four of the local authorities in England, surely now is the right time to take a fresh look at ageing as a cross-cutting priority and bring together strategic thinking and budgetary planning at the highest levels to ensure reform of any or all public services has our ageing population in mind.

The fiscal clouds and the long-term vision

Pound coins - Photo: Flickr user hitthatswitchOver the last few days and weeks economists and analysts have speculated about the comprehensive spending review. In the build-up, endless rumours and ‘leaks’ and even snapshots of confidential papers inundated the media and kept almost everyone busy – and worried.

After the announcements, some breathed a deep sigh of relief, many felt disappointed while others felt outraged. However important it may be, the CSR only presents a set of fiscal measures to tackle the short term – until 2014 at the most – or, as the Chancellor put it in his speech, measures that ensure “that what we buy, we can afford; that the bills we incur, we have the income to meet; and that we do not saddle our children with the interest on the interest on the interest of the debts we were not ourselves prepared to pay.”

The Chancellor also announced that “a stronger Britain starts here”. Perhaps, but it will take a lot more than fiscal restraint for this attempt not to become a false start.

Fortunately, economics has developed the life-cycle approach, but unfortunately it is taught solely as a way to study consumption and saving decisions. There’s more to it than this.

Let’s consider the Marmot Review on health inequalities, for example. It lists a number of key policies over the life course. When it comes to ‘adults of retirement age’, one of the policy objectives was to increase access to apprenticeships. Certainly most apprentices are young adults – so, how come this is an appropriate objective for people past state pension age? It is, if we look far at the horizon where these young people get to retirement age.

Around 21 per cent of all economically active adults in England have qualifications below Level 2. Students who leave our schools with no or very low qualifications are twice as likely to claim job-related benefits before they are 25 as those with better qualifications. And it is also much more likely that it will be them who may have to struggle most to keep warm in winter and who may have to get by on very low incomes when they get to retirement age, and it is them who are more likely to endure worse health earlier in life and even more likely not to make it to retirement age.

A life-cycle or life-course approach helps dispel the short-term fiscal clouds and focus our effort on the long term vision more clearly. In our submission to the Comprehensive Spending Review, we highlighted 12 key long-term challenges we face as an ageing society. That is, even though we discussed and proposed measures related to public spending over the next four years, we refused to be locked in the short-term fog and never lost our vision.

The best thing about the CSR announcements – if there is such a thing as a ‘best thing’ about it – is that now the focus of the economic discourse may concentrate on the bigger, more meaningful and crucial picture, that of raising productivity and employability, and reducing inequalities, on behalf of everyone – including the people currently in older age and the future older people. This is the real challenge facing us in the longer term and Age UK will be seeking to ensure that it is not forgotten.

Spending Review – state pensions and welfare

The welfare budget has again been targeted for savings. In the Emergency Budget in June £11 billion of savings were announced and, in the recent Spending Review, George Osborne set out a further £7 billion of savings to be made by 2014-15. In the context of such major cuts it will be somewhat of a relief to many older people that cold weather payments will remain at £25 for each week of very cold winter weather and that despite rumours that the universal winter fuel payments could be restricted or means-tested they will not be changed.

Other much valued universal support such as bus passes and free prescriptions are also unscathed.  People aged 65 and over receiving the savings credit as part of their Pension Credit will be worse off as the maximum payment will be frozen for 4 years, although many of the other welfare savings will have limited impact on people under state pension age.

For those of working age, in the longer term the Work and Pensions Secretary Iain Duncan Smith has been given the green light to take forward his plans for major reforms to combine a range of benefits and tax credits into a single Universal Credit.

There is considerable support behind the principle of a simpler system with better incentives to save, but these are radical changes which  bring about major challenges. In the meantime, the contributory element of employment and support allowance will be restricted to one year from 2012-13 onwards. This will save £2 billion by 2014-15, but will mean that people unable to work due to disability and ill-health, who are not entitled to means-tested benefits, will get far less return from what may have been 30 or 40 years of working and paying  national insurance.

And the news isn’t good for some 5 million people in their 50s expecting to draw their state pension at 65 or earlier. Under current rules state pension age would have gradually increased to 65 for women by 2020 and then to 66 for both men and women between 2024 and 2026. The Coalition Government had already signalled their intention to speed up this increase and the Chancellor announced that equalisation will now take place in November 2018 and state pension age will rise to 66 for both men and women by April 2020.

This will be a particular blow to some women who face much steeper rises than expected and breaks the Coalition Agreement which says that any rise to 66 will no t start sooner than 2020 for women.   At Age UK we acknowledge that on average people are living longer but are concerned that disadvantaged groups who are most reliant on state pensions and have lower life expectancies  will be hit hardest. Proposals for further increase in state pension age in the future are also expected. We will be working hard to ensure that further reforms only go ahead if health inequalities are reducing, people have the ability and opportunity  to work longer,  disadvantaged groups are protected and everyone is entitled to a decent state pension.

Changing one thing in Rochdale

It takes just 2 hours to get to Manchester from London and only another 20 minutes to get to Rochdale by train. But when we arrive at the small cul-de-sac of bungalows, it feels a long way from Westminster and the Comprehensive Spending Review. But it is in places like this that the impact will be felt.

Welcome to RochdaleMy colleague and I are in Rochdale to meet with a group of older people. The driving force behind the group – I’ll call him Mr Jones – contacted Age UK because he was concerned about the state of the little cul-de-sac where he and his neighbours live.

I’m hoping that the group will take up our new Change One Thing campaign. We’re going to be supporting local groups of people in later life to campaign to make their neighbourhoods better.

We know from a wealth of research that the things older people say they need in their areas are often very practical – public transport to get around, benches and seats, accessible public toilets, and so on. We want to help groups identify the one thing which would make the most difference and run a local campaign to change it. (Hence the name!)

We’ve arranged to meet at the house of Mr Jones’ next-door-neighbour. While she makes us a cup of tea, Mr Jones pops across the cul-de-sac to gather the others. In the end we have a group of four.

We start to explore the problems that they face. Graffiti, litter and poor service from council and housing association contractors are all mentioned.

Two themes emerge from what they say. One is the degree to which they depend on ‘the powers that be’ (mostly the council and the housing association) for things like household repairs and maintenance, and the constant battle they feel they are waging to be heard by those powers.

The other is the support they give each other, and the sense of community they obviously have. I’m interested to see what the Big Society might look like here.

After quite some discussion, and with our encouragement, they settle on one issue to tackle: the poor state of the pavements in the cul-de-sac. Then we go on to think about who could deliver this, and how they can go about organising a campaign to persuade them.

If they can organise themselves, and stay focused, I think they have a reasonable chance of success. After all, in many ways, it’s a no brainer – the cost of repairing a few pavements is trivial compared to the cost of treating a hip fracture, or of providing home care to someone who is unable to get out and about after a fall.

But with cuts to council budgets inevitable, I have a nasty feeling that pavement repairs is exactly the kind of thing which may just not happen in the future. Let’s hope that councils will take the challenge of seeing the big picture.

Comprehensive Spending Review a fair deal for older people

Overall, today’s Comprehensive Spending Review represents a fair deal for people in later life, with a range of announcements on pensions, social care and universal benefits. Firstly, we were relieved to see no cuts to universal benefits paid to older people, from free eye tests to the Winter Fuel Allowance. These benefits make a huge difference to the lives of the millions of older people managing on low incomes, and their protection is very welcome.

The Treasury obviously listened to Age UK’s top call for the Spending Review, “Don’t cut care”, with care budgets fairing far better than expected just a few weeks ago.  The Chancellor rather over-egged the announcement, by describing the package as £2 billion of new money. In truth, the extra resource from the Department of Health will only plug the gap in the government-wide cut to local government support. Overall, we expect that spending on care will fall modestly in real terms over the next four years; but it could have been far, far worse. Half of the money for care will come from the NHS budget, which we support, as health and social care are inextricably linked. The rest will be a grant for councils that will be earmarked for care services, but not ring-fenced – so it will be down to local campaigners to ensure that councils actually maintain care budgets in each community.

On the NHS, we were pleased to see an acknowledgement that the proposed £20bn savings would need to be reinvested, and that it was important to make these savings to face up to the reality of our ageing population. Sustained funding for dementia research will be welcomed by the thousands of sufferers and their families and friends across the UK.

We saw good news on the Post Office network, a vital lifeline for many older people, particularly those in rural areas; the temporary increase in the level of Cold Weather Payments will become permanent; and the Government’s commitment to roll out superfast broadband should hopefully encourage more people in later life to go online.

However, it wasn’t all good news. The State Pension Age will now be raised to 66 between 2018 and 2020 for both men and women, substantially before the previous plan of 2025-26 – and in breach of the coalition agreement’s commitment not to raise women’s state pension age. Many people approaching the end of their working lives will be disappointed that this rise is coming six years earlier than expected, and it is worth bearing in mind that this change will not save the Government any money for another eight years. That said, it could have been worse, as the original proposal was for men’s pension age to rise from 2016.

The Warm Front programme will, as expected, be phased out when new energy efficiency and climate change programmes come on stream. To accompany this, we now need urgent national and local plans for tackling fuel poverty, particularly among older people. One in five households containing someone over 65 are currently experiencing fuel poverty – that’s too many households facing the difficult choice between heating and eating. With energy prices continuing to rise, we’ll be scrutinising the Government’s forthcoming proposals to ensure they prioritise affordability for low income groups, not just climate change.

The Chancellor has done better than many feared at safeguarding public services and pensioner benefits over the short term. But so far, the Government’s thinking has been focused on the next four years, not the decades to come. With the immediate task of cutting the deficit now underway, Age UK will be challenging the Government to raise its sights to the horizon and develop responses to the long-term challenges of our ageing society, across care, the NHS, pensions and the consumer market.

12 challenges for our ageing nation

Welcome to Age UK’s new blog for everyone interested in later life and our ageing society. Age UK experts will be writing on age-related topics across politics, public policy, service delivery, research, campaigning and international affairs.

Over the next week or so, our main focus will be Wednesday’s Spending Review announcement (no surprise there). We’ll be blogging live while the Chancellor is speaking and providing more detailed analysis in the hours and days that follow. But in my first post, I want to step back from the nitty gritty of spending cuts and policy programmes.

Spending Reviews should be a moment for governments to ask themselves big, long-term questions. So what are the key long-term challenges we face as an ageing society, to which the Government should be responding? In our submission to the Spending Review we picked 12:

  1. Creating a savings and pension culture, to deliver good pension provision for everyone currently in working life
  2. Extending working lives to achieve sustainable national and personal finances as life expectancy rises
  3. Preventing longer periods of illness in later life, through the promotion of healthy lifestyles, the rollout of recent innovation in health and care, and sustained Research and Development.
  4. Reducing levels of inequality within each age cohort and moving towards the progressive eradication of pensioner poverty
  5. Delivering care and support which provides autonomy, security and dignity to frail older people and their families
  6. Fundamentally changing attitudes to later life and ageing
  7. Building communities that can tackle severe isolation and exclusion towards the end of life
  8. ‘Age proofing’ services and environments so they meet the needs and aspirations of every age group, including reform of the NHS to meet the needs of late old age
  9. Engaging people in later life with successive waves of new technology
  10. Re-imagining and re-designing every stage of life in the knowledge of very long life expectancies – ie, how we combine education, work, leisure and retirement across our lives
  11. Supporting strong families and intergenerational ties at a time of huge social change: growing ethnic and cultural diversity, increased family breakdown, and growing domestic and international mobility
  12. Planning for sustainable growth in the share of GDP spent on age-related social security and public services and the long-term fiscal implications

Now, there’s nothing like a list to kick off discussion, and we’d love to hear your thoughts. Are these that issues that will really matter over the next decade or so, if we’re going to improve later life in the UK? Have we missed something? Which matter most? And how on earth should politicians, public servants, businesses, charities and individuals set about responding?

Tell us what you think.

By Andrew Harrop

Why Age UK is blogging

This is Age UK’s pilot blog and we’re really excited about it.

Primarily, it will be used to talk about political and policy issues that affect people in later life and some of Age UK’s experts in various key areas will be posting their thoughts over the next few months.

While we don’t believe that any time is more important than any other for older people, the Government’s Comprehensive Spending Review and the fallout from the cuts is liable to affect people in ways that no-one can imagine.

The Age UK blog is here to try and make sense of the key decisions and issues that affect people in later life.

And, as we’ve already mentioned, this is a pilot blog and we’re keen for you to get involved and let us know what you think. A blog is nothing without comment and feedback from its audience, so please make your views heard.

We look forward to hearing from you.