Hot Topic: Funding Cuts

Funding Cuts: the issue

Care and support budgets in Scotland's third sector continue to be affected by budget cuts - radically in many cases - threatening services and jobs in many local authority areas. Earlier this year, providers reported across-the-board cuts of between 4% and 20% are being imposed by a range of local authorities across the country.

CCPS is concerned that these cuts take no account of the significant reductions in operating costs already made by third sector providers in recent years, in respect both of efficiency savings and of difficult decisions about staff pay, terms and conditions. Neither do they take account of the consistently higher quality of care and support provided by the third sector, as demonstrated by inspection reports and gradings awarded by the national regulatory body, the Care Commission.

CCPS supports the four pillars of the Scottish Government’s programme for reforming public services contained in the Christie Commission response, focusing on preventative spend, greater partnership working and integration of services, workforce development and performance improvement. Three new change funds were announced in the November 2011 budget to support work on Reshaping Care for Older People, a shift to more early intervention with the Early Years Change fund, and a targeted change fund to focus on reducing reoffending. For more information on the Christie Commission response, please follow this link.

CCPS members sit on the Early Years Task Force and report back quarterly to the CCPS Committee on Children and Young People. Annie Gunner Logan sits on the Health and Community Care Delivery Group (part of the Scottish Government's integration structure), which among other things considered the individual Reshaping Care change fund plans for each local authority for 2012-13. More information about the Reshaping Care change funds can be found on the Scottish Government website here and copies of each change fund plan can be viewed on the JIT website here.

CCPS continues working to highlight issues affecting the social care workforce, including promoting and protecting staff terms and conditions and making the connection between the cost of care and the resulting quality of service and outcomes for service users; joint work with the main Scottish trade unions, and support for the Living Wage Campaign, particularly in relation to procurement. Previous Strathclyde University research commissioned by the CCPS-hosted Workforce Unit, highlighted the widespread job losses, pay freezes and reductions in terms and conditions for staff within the voluntary sector as a result of reduced or standstill funding and increased competitive tendering for care services in recent years. For the full report, see link in the right-hand column.

Our regular provider optimism survey tracks the impact of local authority funding decisions on the sustainability of care and support provider organisations, the the impact on quality of services and staff terms and conditions. You can view the November 2011 survey here. Our next survey will be timed to capture the impact of any further budget decisions following the May 2012 local authority elections.

Mapping the Cuts

From April 2011, The Guardian newspaper began to track public sector cuts across the UK (including Scotland). To view this map, please follow this link. The Guardian journalist Patrick Butler also has a cuts blog that mainly focuses on Engalnd and Wales but occasionally includes stories from Scotland.

As noted above, CCPS is also mapping cuts within its own membership through its regular provider optimism survey and keeps a watching brief on this issue - details of the latest survey are summarised below.

Latest News

November 2011 survey provides further evidence of ongoing impact of funding cuts

CCPS has published the sixth of its Service Provider Optimism surveys, a longitudinal study designed to track the way that social care providers view their organisations' prospects and the environment in which they operate. MSP Jackie Baillie picked up on the results of the CCPS survey in her recent Parliamentary motion, noting the headline results of the survey and flagging up her concerns about the impact of funding cuts on the quality of service provision.

The November 2011 iteration of the survey reveals the ongoing impact of a range of factors on voluntary sector providers.
Over the three months prior to November 2011:
• 35% of respondents report a downturn in business / turnover
• 41.9% report the numbers of staff in employment has gone down
• 41.9% report a decrease in surplus

While some figures show signs of stabilising in the short term (compared with May 2011 results), the price paid has been a high one, with nearly two thirds of respondents implementing major changes to staff terms and conditions, redundancies across frontline and management levels, and/or reductions in services.

100% of respondents have seen budget reductions from local authorities for 2011/12, with a growing concern that funding cuts are having a detrimental effect on the quality of service provision.

May 2011 survey reveals early effect of cuts to voluntary sector care provision

The latest CCPS Provider Optimism Survey (May 2011) reveals the extent of current financial pressures on voluntary sector providers. Over the last three months:

44% of providers responding to the survey report a downturn in business/turnover
58% report that the number of staff in employment have gone down
47% report a decrease in operating surpluses.

Meanwhile 93% of survey respondents have been notified of budget cuts to services in at least one Scottish local authority area for 2011/12, while 78% of respondents have experienced cuts in multiple areas. The survey findings will be disseminated to a wide range of stakeholders, including key policy and decision makers.

New research reveals impact of funding constraints on workforce terms and conditions in the voluntary sector

There are now no remaining elements of public sector pay and conditions universally available to social care staff in the voluntary sector, according to new research from the University of Strathclyde, even though voluntary organisations provide more than a third of Scotland’s publicly-funded registered care services.

The research, conducted by Dr Ian Cunningham of the Department of Human Resource Management, and commissioned by the Voluntary Sector Social Services Workforce Unit, highlights the radical measures that organisations have had to take in order to remain in operation as providers of care and support.

In the last three years:

79% of voluntary sector care organisations have been unable to award a cost of living rise to staff equivalent to the increases paid to the public sector workforce 57% have implemented pay freezes
44% have made redundancies to frontline staff, and 55% have lost line managers
60% have made cuts to training budgets
73% report that they are increasingly having to raid organisational reserves in order to maintain services
Only 15% retain any link with public sector pension arrangements.

Pay scales and conditions of service in the voluntary sector used to be broadly equivalent to public sector terms and conditions, but intense and sustained pressure to cut costs has meant that very few voluntary care organisations now retain any link with public sector conditions of service. The research warns that the quality and sustainability of care services in the sector is being put at risk as a result.

Campaign for a Fair Society

CCPS has added its name to the 'Campaign for a Fair Society', a UK-wide initiative launched on 8 February protesting about the impact of cuts on disabled people.
The campaign is highlighting a range of cuts affecting disabled people:

Reductions in local authority budgets leading to reductions in funding to all local authority funded care and support services.
The closure of the Independent Living Fund (ILF) which will affect 21,000 of the most severely disabled people and may prevent many from continuing to live independently in the community.
Changes to Support for Mortgage Interest benefit that effectively rule out shared home ownership for disabled people.
A threat to the mobility component of Disability Living Allowance (DLA) for people in residential care, which helps meet some of the cost of things such as electric wheelchairs, mobility aids and taxis where there is no accessible public transport, and without which many people could be isolated.