Market will support victims of future care provider collapses - LGA

The National Audit Office (NAO) has warned the government that people using personal budgets to fund their social care need more support and greater protection from provider failures.

However the Local Government Association (LGA) said the market will be able to support people should their care provider go bust in a similar manner to that of Southern Cross.

David Rogers, chair of the community wellbeing board at the LGA, was unable to identify what measures had been put in place to protect vulnerable people should it happen again.

When asked by BBC Radio 4's Today programme what support was available to people in that situation, Rogers said: "Clearly we're referring to Southern Cross and that's been exceptionally well managed by a combination of local and national partners working together for a smooth transition in very difficult circumstances.

"Let's hope that doesn't happen with other providers.

"But also we need to bear in mind we're not just talking about residential care, but in the majority of cases people who receive support in their own homes.

"And there, there is a vast and growing market of alternative providers who would be able to support them in the way that they need," he added.

The NAO report highlighted a number of "shortcomings" that must be addressed if social care personal budgets are to prove value for money in the future.

They are:

• more needing to be done to ensure that care markets deliver a genuine choice of services to all users,

• that support is available to help people exercise choice,

• and that essential services relied on by vulnerable people continue to be provided in the event of the failure of a major provider.

Other concerns surrounded the lack of awareness by local authorities over the numbers of people and sums they were effectively underwriting with few offering formal support to help prevent people falling back on state funding.

The NAO estimated that the total cost to the taxpayer of the state having to pay for self-funders who run out of money could rise from £0.5bn to £1bn per year by 2035.

However it recognised that most people using personal budgets reported improved wellbeing, although a small minority feel worse off, while some also noted that they found buying care for themselves difficult.

The introduction of personal care budgets in England, which put the onus on people to source and pay for their own care needs - including long-term care, has proved controversial.

Last month the NHS Confederation concluded its survey into the introduction process so far by calling for trials to be extended and further consultations with industry experts, with the full implementation date of April 2013 to be delayed.