Portfolio: Adult Care Services

APPENDIX 1

PORTFOLIO: ADULT CARE SERVICES

PROPOSED RESOURCE BUDGET 2006/07 – 2009/10

Chief Officer: Sarah Pickup, Director of Adult Care Services (01992 556300)

Contact for queries: Ralph Paddock, Head of Finance (01992 556354)

APPENDIX 1 - CONTENTS

A Commentary

B Revenue Budget 2006/07 - 2009/10 and Movement from Current Year’s Budget

C Pressures for Change

D Savings

APPENDIX 1A

COMMENTARY

1.1  This Appendix outlines details of the proposals for a revenue budget of £215,582 million (excluding capital charges and the FRS17 pension adjustment) for Adult Care Services.

1.2  The cashable efficiency savings included in the proposals are summarised below with fuller details provided in the following appendices:

Cashable Efficiency Savings / £’000
FYE of Previous Efficiencies / 234
06/07 Gershon Savings / 4,526
06/07 Other Savings / 237
Total / 4,997

1.3  In addition to the cashable efficiencies, a further £1.9 million of non-cashable efficiency savings have been identified and these are detailed in appendix 1D.

1.4  There continues to be severe pressures on the Adult Care Services budget.

1.5 The key continuing pressures on the budget are as follows:

·  There is continuing demographic pressure on all budget areas. The largest client group is those aged over 85 and the number of such people in Hertfordshire is expected to increase by 4.26 per cent over the year. The number of adults with learning disabilities is expected to increase by 60 in 2006/07 and most of these will receive a service from the County Council. Similarly, there are year on year increases in the numbers of people with mental health problems and with physical disabilities.

·  The service continues to face increasing targets that have to be met. The elderly and physical disability staffing review is in part a response to this and the need to meet tougher assessment targets, ensuring that all assessments are completed within 28 days.

·  Person centred care and the increased registration standards that Adult Care Services and the private and voluntary sector suppliers have to meet is also a major challenge. This continues to put pressure on prices and, in terms of the accommodation the County Council owns, also results in cost pressures. For example, to meet Supported Living standards, there is a possibility that the number of beds will reduce and this will mean ultimately that higher prices will have to be paid in the private and voluntary sector, or more accommodation will have to be provided using County Council capital.

·  Adult Care Services continue to operate in a challenging environment in which to recruit and retain staff, particularly in terms of care workers. This leads to particularly high vacancy levels in supporting people in accommodation and many recruitment initiatives have to take place to avoid an increasing dependency on agency staff.

APPENDIX 1B

REVENUE BUDGET 2006/07 – 2009/10

AND MOVEMENT FROM CURRENT YEAR’S BUDGET

ADULT CARE SERVICES

2006/07 / 2007/08 / 2008/09 / 2009/10
£'000 / £'000 / £'000 / £'000
2005/06 Original Budget / 197,659 / 197,659 / 197,659 / 197,659

Technical Adjustments 2005/06

/ 5,710 / 6,067 / 6,397 / 6,702
2005/06 Adjusted Budget / 203,369 / 203,726 / 204,056 / 204,361
Technical Adjustments 2006/07 / 1,322 / 1,322 / 1,322 / 1,322
Inflation / 9,134 / 9,134 / 9,134 / 9,134
Pressures for Change:
Previous Policy Decisions:
2005/06 & Prior Years
a) Introduction of fairer charging / (2,824) / (3,184) / (3,184) / (3,184)
b) Maximising charging income / (327) / (350) / (350) / (350)
FYE of previous efficiencies:
a) Homecare externalisation / (104) / (166) / (217) / (217)
b) Business Process Review / SHARP savings / (80) / (80) / (80) / (80)
c) Enabling Homecare / (50) / (100) / (150) / (150)
Demography:
a) Elderly / 2,593 / 5,186 / 7,779 / 10,372
b) Learning Disability – previous years / 2,400 / 2,400 / 2,400 / 2,400
c) Learning Disability / 2,820 / 5,357 / 7,860 / 10,048
d) Physical Disability / 812 / 1,624 / 2,436 / 3,248
e) Mental Health / 788 / 1,576 / 2,364 / 3,152
Legislative Changes:
a) Introduction of national minimum standards / 40 / 80 / 80 / 80
Other Pressures:
a) Business Rates / (2) / 3 / 6 / 6
b) LGPS employers’ contributions / 283 / 573 / 796 / 1,292
c) Regrading of in house unit managers’ posts / 31 / 31 / 31 / 31
d) Revenue Effects of Capital / 93 / 466 / 686 / 786
e) Revenue Effects of Telecomms / 21 / 47 / 91 / 134
f) Capital Payback / 198 / 313 / 273 / 220
g) Reduction in Supporting People grant / 1,000 / 1,500 / 1,500 / 1,500
Funded from Grant / (1,172) / (499) / 0 / 0
2006/07 / 2007/08 / 2008/09 / 2009/10
£'000 / £'000 / £'000 / £'000
Cashable Efficiency Savings:
a) Individual banded budgets for Learning Disability placements / (180) / (360) / (540) / (720)
b) Expert purchasing of care placements for Learning Disability / (250) / (500) / (1,500) / (2,000)
c) Community Learning Disability Teams / (150) / (150) / (150) / (150)
d) In-house: reduction in holiday entitlements / (100) / (100) / (100) / (100)
e) Transport / (200) / (200) / (200) / (200)
f) Review day services for older people / (500) / (500) / (500) / (500)
g) Cost benefits of long stay booking system / (100) / (100) / (100) / (100)
h) Reduction in top up targets for older people / (200) / (200) / (200) / (200)
i) Greater use of sheltered housing / (100) / (200) / (300) / (400)
j) Rollout enabling homecare / (500) / (500) / (500) / (500)
k) Central units staff / (123) / (123) / (123) / (123)
l) Finance / (140) / (240) / (240) / (240)
m) Manpower contract / (207) / (207) / (207) / (207)
n) Supporting People Budget / (1,000) / (1,500) / (1,500) / (1,500)
o) Meals on Wheels / (20) / (160) / (160) / (160)
p) Delayed discharges agreement / (200) / (200) / (200) / (200)
q) Reduce EPD agency staff / (20) / (20) / (20) / (20)
r) Reduce Blue Badge admin / (100) / (100) / (100) / (100)
s) Better procurement & individual budgets for Physical Disability / (50) / (100) / (150) / (200)
t) Herts Partnership Trust (HPT)– better purchasing / (300) / (300) / (300) / (300)
u) Employer’s liability insurance / (56) / (66) / (66) / (66)
v) Disability Information Project / (30) / (30) / (30) / (30)
w) Learning & Development grant additional work / (200) / (200) / (200) / (200)
x) Mainstreaming Supporting People admin / (37) / (37) / (37) / (37)

STANDSTILL BUDGET

/ 215,582 / 222,866 / 229,410 / 235,852

APPENDIX 1C

2006/07 PRESSURES FOR CHANGE / £’000 /
Previous Policy Decisions
2005/06 & Prior Years
a) Introduction of Fairer Charging
Introduce fairer charging – charge against benefits. / - 2,824 / 2006/07
- 3,184 / 2007/08
onwards
b) Maximising Charging Income
Maximising charging income by implementing policy changes including:
- a charge for meals that reflects more closely the cost of providing the meal
- introduce charging for transport services / - 327 / 2006/07
- 350 / 2007/08
onwards
Full Year Effect of Previous Efficiencies
a) Home care externalisationThe in house home care service was transferred to Leonard Cheshire on 1 February 2000. The estimated savings are based on the same assumptions as last year in respect of the rate at which transferred staff are leaving Leonard Cheshire to be replaced by new staff appointed by Leonard Cheshire. / - 104 / 2006/07
- 166 / 2007/08
- 217 / 2008/09
onwards
b) Business process reviewIt is anticipated that significant savings will be generated by the review of the department’s business processes. This is the full year effect of the savings identified last year with the main impact being on financial services. / - 80 / 2006/07
onwards
c) Enabling HomecareThis is part of the new model for homecare and the pilot indicated that there would be an estimated annual reduction in costs, net of the enablement service, of £956 per client.
The £956 could be increased by improved commissioning but reduced by loss of charging income (approximately 10%). An estimated saving of £1,000 per client has therefore been assumed. / - 50 / 2006/07
- 100 / 2007/08
- 150 / 2008/09
onwards
Demographic Changes
Unavoidable increased service demands result in the following pressures for each of the four main client groups.
a) Elderly
Around 50% on the ACS budget for older people is spent on the 85 and over age group, 40% on the 75 to 84 age group and 10% on the 65 to 74 age group. The projected increases in the numbers in these age groups have been used together with the estimated spends on these age groups to produce the year on year budget increases required to meet demographic pressures. / + 2,593 / 2006/07
+ 5,186 / 2007/08
+ 7,779 / 2008/09
+ 10,372 / 2009/10
b) Learning Disabilities – previous years
Demography for 2004/05 and 2005/06 was understated. It was based on 40 net new clients and 52 unavoidable placements were made in 2004/05 and 62 are expected to be placed in 2005/06. Needs have also increased. Care and Health Consultants have reviewed placements and confirmed that they were appropriate and unavoidable as eligibility criteria they "could not be tightened as they were set at the most stringent level acceptable to central government" Consequently the base budget is £2.4million short and extra demography is required. / +2,400 / 2006/07
onwards
c) Learning Disability
The demographic pressure estimates for the Learning Disability client group are those calculated by Care and Health Management Consultants in their draft report Modelling of Demand and Future Costs. / +2,820 / 2006/07
+5,357 / 2007/08
+7,860 / 2008/09
+10,048 / 2009/10
d) Physical Disability
The projection for demographic pressures is based on the increase in costs and numbers of clients (especially for residential care) over the last three years. / + 812 / 2006/07
+ 1,624 / 2007/08
+ 2,436 / 2008/09
+ 3,248 / 2009/10
e) Mental Health
The projection for demographic pressures is based on the increase in costs and numbers of clients (especially for residential care) over the last three years. HPT have assisted in producing these estimates. / + 788 / 2006/07
+ 1,576 / 2007/08
+ 2,364 / 2008/09
+ 3,152 / 2009/10
2006/07 PRESSURES FOR CHANGE / £’000
Legislative Changes
a) Introduction of national minimum standards
Introduction of national minimum standards in care homes will result in an increase in the charges made by some providers.
This change is being phased in by 2007. Providers will increase their weekly rates to reflect, for example, room size and en-suite specifications in independent sector residential homes. / + 40 / 2006/07
+ 80 / 2007/08
onwards
Other Pressures
a) Business RatesThis relates to the estimated additional costs arising from the 2005 revaluation of property for rating purposes. / - 2 / 2006/07
+ 3 / 2007/08
+ 6 / 2008/09
+ 6 / 2009/10
b) LGPS employers’ contribution / + 283 / 2006/07
Estimated cost of the increase in employers‘ / + 573 / 2007/08
contributions to the local government pension scheme. / + 796 / 2008/09
+ 1,292 / 2009/10
c) Regrading of in house unit managers’ posts
A review of the grading of certain in house unit managers’ posts has resulted in additional staffing costs being incurred in 2004/05 and subsequent years. / + 31 / 2006/07
onwards
d) Revenue Effects of CapitalThese are the revenue consequences of undertaking capital works within the agreed capital programme. / + 93 / 2006/07
+ 466 / 2007/08
+ 686 / 2008/09
+ 786 / 2009/10
e) Revenue Effects of TelecomsThe department’s share of the revenue consequences of undertaking corporate telecommunications capital works within the agreed capital programme and the Telecommunications Infrastructure Fund. / + 21 / 2006/07
+ 47 / 2007/08
+ 91 / 2008/09
+ 134 / 2009/10
f) Capital PaybackPayback associated with the ACS general capital programme. / + 198 / 2006/07
+ 313 / 2007/08
+ 273 / 2008/09
+ 220 / 2009/10
g) Reduction in Supporting People Grant / + 1,000 / 2006/07
Funding to replace the anticipated reduction in / + 1,500 / 2007/08
Hertfordshire’s allocation of Supporting People Grant. / onwards

APPENDIX 1D

SAVINGS / £’000 /
Cashable Efficiency Savings - Gershon
a) Individual Banded Budgets for Learning Disability Placements
This is a pilot scheme that will require a project manager and will be applied to “client turnover”. / - 180 / 2006/07
- 360 / 2007/08
- 540 / 2008/09
- 720 / 2009/10
b) Expert Purchasing of Care Placements for Learning Disability Expert purchasing of care placements for Learning Disabilities will produce savings. These savings will be generated by reviewing unit costs. / - 250 / 2006/07
- 500 / 2007/08
- 1,500 / 2008/09
- 2,000 / 2009/10
c) Community Learning Disability Teams
Estimated savings of 5% will be generated by streamlining Community Learning Disability Teams. / - 150 / 2006/07
onwards
d) In-house: reduction in holiday entitlements
In-House services – possible reduction in staff entitlement to holidays when they are on sick leave. Subject to necessary changes in Corporate Policy. / - 100 / 2006/07
onwards
e) Transport
Savings on transport will be achieved through a variety of measures including:
- changing the eligibility barrier
- reimbursement of staff and carers for mileage