Stuart Hoddinott
@stuarthoddinott.bsky.social
Associate Director in the public services team
@InstituteforGov. Interested in the NHS, adult social care, and local government. All views my own. He/him
@InstituteforGov. Interested in the NHS, adult social care, and local government. All views my own. He/him
In fact, social insurance models are often associated with higher admin costs
And the cost of shifting our model would be enormous, the "mother and father" of all NHS reforms
All for almost no real efficiency gain
Read our paper here: www.instituteforgovernment.org.uk/publication/...
And the cost of shifting our model would be enormous, the "mother and father" of all NHS reforms
All for almost no real efficiency gain
Read our paper here: www.instituteforgovernment.org.uk/publication/...
October 30, 2025 at 5:50 PM
In fact, social insurance models are often associated with higher admin costs
And the cost of shifting our model would be enormous, the "mother and father" of all NHS reforms
All for almost no real efficiency gain
Read our paper here: www.instituteforgovernment.org.uk/publication/...
And the cost of shifting our model would be enormous, the "mother and father" of all NHS reforms
All for almost no real efficiency gain
Read our paper here: www.instituteforgovernment.org.uk/publication/...
In addition to the £11bn, they claim that moving to a social insurance model would deliver "substantial savings". They don't even bother having a source for this
The evidence is clear: there is no benefit from a social insurance model vs funding from general taxation
www.oecd.org/content/dam/...
The evidence is clear: there is no benefit from a social insurance model vs funding from general taxation
www.oecd.org/content/dam/...
October 30, 2025 at 5:50 PM
In addition to the £11bn, they claim that moving to a social insurance model would deliver "substantial savings". They don't even bother having a source for this
The evidence is clear: there is no benefit from a social insurance model vs funding from general taxation
www.oecd.org/content/dam/...
The evidence is clear: there is no benefit from a social insurance model vs funding from general taxation
www.oecd.org/content/dam/...
There's supposedly £1bn further savings from reducing agency staff. The NHS spent ~£2bn on agency staff in 2024/25
The govt has an ambition to reduce it by another £1bn over 5 years as part of SR departmental efficiency plans. A further £1bn seems extremely unlikely
www.gov.uk/government/n...
The govt has an ambition to reduce it by another £1bn over 5 years as part of SR departmental efficiency plans. A further £1bn seems extremely unlikely
www.gov.uk/government/n...
October 30, 2025 at 5:50 PM
There's supposedly £1bn further savings from reducing agency staff. The NHS spent ~£2bn on agency staff in 2024/25
The govt has an ambition to reduce it by another £1bn over 5 years as part of SR departmental efficiency plans. A further £1bn seems extremely unlikely
www.gov.uk/government/n...
The govt has an ambition to reduce it by another £1bn over 5 years as part of SR departmental efficiency plans. A further £1bn seems extremely unlikely
www.gov.uk/government/n...
Once you exclude the old and the young, the "savings" drop dramatically. We estimated that a £10 charge would raise £350m-£400m, so £700m-£800m for a £20 charge
But it would also deter people from seeking care, potentially adding costs later when they need more intensive treatment
But it would also deter people from seeking care, potentially adding costs later when they need more intensive treatment
October 30, 2025 at 5:50 PM
Once you exclude the old and the young, the "savings" drop dramatically. We estimated that a £10 charge would raise £350m-£400m, so £700m-£800m for a £20 charge
But it would also deter people from seeking care, potentially adding costs later when they need more intensive treatment
But it would also deter people from seeking care, potentially adding costs later when they need more intensive treatment
Quite a bold claim from the NHS, given that it published its 10 year health plan just a few months ago
October 30, 2025 at 8:27 AM
Quite a bold claim from the NHS, given that it published its 10 year health plan just a few months ago
They also lay out other options like reducing demand, delivering services more efficiently, and cutting their capital budget
But many of those options will themselves need upfront funding to realise
There are no easy options left
But many of those options will themselves need upfront funding to realise
There are no easy options left
October 24, 2025 at 9:48 AM
They also lay out other options like reducing demand, delivering services more efficiently, and cutting their capital budget
But many of those options will themselves need upfront funding to realise
There are no easy options left
But many of those options will themselves need upfront funding to realise
There are no easy options left
And WCC acknowledge the pressure on residents, but spell out what will happen if they don't increase council tax:
- Fewer services or reduced access
- Longer waiting times for support
- Less support for vulnerable people
That's a pretty explicit warning to residents about the consequences
- Fewer services or reduced access
- Longer waiting times for support
- Less support for vulnerable people
That's a pretty explicit warning to residents about the consequences
October 24, 2025 at 9:48 AM
And WCC acknowledge the pressure on residents, but spell out what will happen if they don't increase council tax:
- Fewer services or reduced access
- Longer waiting times for support
- Less support for vulnerable people
That's a pretty explicit warning to residents about the consequences
- Fewer services or reduced access
- Longer waiting times for support
- Less support for vulnerable people
That's a pretty explicit warning to residents about the consequences
They also float the idea of applying to central govt to be allowed to raise council tax by 10%, rather than the 5% limit
This is increasingly common. Six LAs received permission to do so last year
But it adds costs to residents who are already living through a cost of living crisis
This is increasingly common. Six LAs received permission to do so last year
But it adds costs to residents who are already living through a cost of living crisis
October 24, 2025 at 9:48 AM
They also float the idea of applying to central govt to be allowed to raise council tax by 10%, rather than the 5% limit
This is increasingly common. Six LAs received permission to do so last year
But it adds costs to residents who are already living through a cost of living crisis
This is increasingly common. Six LAs received permission to do so last year
But it adds costs to residents who are already living through a cost of living crisis
What solutions are WCC considering? They've applied for £43.6m of EFS in 2026/27
That money will be a mix of borrowing and asset sales
But borrowing is risky
They say they are near the "safe, affordable, and sustainable" amount of borrowing and that additioanl will add costs for the next 20 years
That money will be a mix of borrowing and asset sales
But borrowing is risky
They say they are near the "safe, affordable, and sustainable" amount of borrowing and that additioanl will add costs for the next 20 years
October 24, 2025 at 9:48 AM
What solutions are WCC considering? They've applied for £43.6m of EFS in 2026/27
That money will be a mix of borrowing and asset sales
But borrowing is risky
They say they are near the "safe, affordable, and sustainable" amount of borrowing and that additioanl will add costs for the next 20 years
That money will be a mix of borrowing and asset sales
But borrowing is risky
They say they are near the "safe, affordable, and sustainable" amount of borrowing and that additioanl will add costs for the next 20 years
WCC acknowledges that the Fair Funding Review should better match funding with need
But uncertainty about allocations until the end of 2025 makes planning for 2026/27 extremely difficult
Central govt policy - even if well intentioned - adds uncertainty
But uncertainty about allocations until the end of 2025 makes planning for 2026/27 extremely difficult
Central govt policy - even if well intentioned - adds uncertainty
October 24, 2025 at 9:48 AM
WCC acknowledges that the Fair Funding Review should better match funding with need
But uncertainty about allocations until the end of 2025 makes planning for 2026/27 extremely difficult
Central govt policy - even if well intentioned - adds uncertainty
But uncertainty about allocations until the end of 2025 makes planning for 2026/27 extremely difficult
Central govt policy - even if well intentioned - adds uncertainty
WCC is going through local govt reorganisation (LGR), as are all county councils. That will abolish district councils
WCC say it aims to make local govt "simpler and more efficient"
But also warns that it is likely to add spending pressures in the short-term and makes long-term planning difficult
WCC say it aims to make local govt "simpler and more efficient"
But also warns that it is likely to add spending pressures in the short-term and makes long-term planning difficult
October 24, 2025 at 9:48 AM
WCC is going through local govt reorganisation (LGR), as are all county councils. That will abolish district councils
WCC say it aims to make local govt "simpler and more efficient"
But also warns that it is likely to add spending pressures in the short-term and makes long-term planning difficult
WCC say it aims to make local govt "simpler and more efficient"
But also warns that it is likely to add spending pressures in the short-term and makes long-term planning difficult
Their school's spending is in deficit because of the growing number of children with an EHCP
That's led to WCC building up a deficit of £184m by the end of 25/26
The only thing that's stopped WCC going bust is the "statutory override" - a tool used by govt to keep these deficits off LAs' books
That's led to WCC building up a deficit of £184m by the end of 25/26
The only thing that's stopped WCC going bust is the "statutory override" - a tool used by govt to keep these deficits off LAs' books
October 24, 2025 at 9:48 AM
Their school's spending is in deficit because of the growing number of children with an EHCP
That's led to WCC building up a deficit of £184m by the end of 25/26
The only thing that's stopped WCC going bust is the "statutory override" - a tool used by govt to keep these deficits off LAs' books
That's led to WCC building up a deficit of £184m by the end of 25/26
The only thing that's stopped WCC going bust is the "statutory override" - a tool used by govt to keep these deficits off LAs' books
What's driving all this pressure on WCC's budget?
Spending on adult and children's social care as well as home-to-school transport has risen faster than any other service
That's being driven by rising demand and increasing complexity of demand, combined with rising costs of delivering services
Spending on adult and children's social care as well as home-to-school transport has risen faster than any other service
That's being driven by rising demand and increasing complexity of demand, combined with rising costs of delivering services
October 24, 2025 at 9:48 AM
What's driving all this pressure on WCC's budget?
Spending on adult and children's social care as well as home-to-school transport has risen faster than any other service
That's being driven by rising demand and increasing complexity of demand, combined with rising costs of delivering services
Spending on adult and children's social care as well as home-to-school transport has risen faster than any other service
That's being driven by rising demand and increasing complexity of demand, combined with rising costs of delivering services
As WCC say, EFS is not a sustainable approach to funding services it "is simply a mechanism that provides the council time to radically change and develop sustainable
solutions"
But some LAs are becoming increasingly reliant on it
Slough and Croydon have used EFS for 8 and 7 years respectively
solutions"
But some LAs are becoming increasingly reliant on it
Slough and Croydon have used EFS for 8 and 7 years respectively
October 24, 2025 at 9:48 AM
As WCC say, EFS is not a sustainable approach to funding services it "is simply a mechanism that provides the council time to radically change and develop sustainable
solutions"
But some LAs are becoming increasingly reliant on it
Slough and Croydon have used EFS for 8 and 7 years respectively
solutions"
But some LAs are becoming increasingly reliant on it
Slough and Croydon have used EFS for 8 and 7 years respectively
The remainder of that gap will be filled with "exceptional financial support" - emergency funding that comes from either selling assets (e.g. buildings) or borrowing
That's a really bad way to fund day-to-day services
WCC has applied for more EFS in 2025/26, this time worth £43.6m
That's a really bad way to fund day-to-day services
WCC has applied for more EFS in 2025/26, this time worth £43.6m
October 24, 2025 at 9:48 AM
The remainder of that gap will be filled with "exceptional financial support" - emergency funding that comes from either selling assets (e.g. buildings) or borrowing
That's a really bad way to fund day-to-day services
WCC has applied for more EFS in 2025/26, this time worth £43.6m
That's a really bad way to fund day-to-day services
WCC has applied for more EFS in 2025/26, this time worth £43.6m
WCC has overspent its budget every year since 2022/23 and expects that to continue
They have a budget gap of £48.6m in 2025/26 (on a budget of roughly £440m). That's even after making savings of £12.5m
They drew down reserves worth £15m to close the gap to £33.6m
They have a budget gap of £48.6m in 2025/26 (on a budget of roughly £440m). That's even after making savings of £12.5m
They drew down reserves worth £15m to close the gap to £33.6m
October 24, 2025 at 9:48 AM
WCC has overspent its budget every year since 2022/23 and expects that to continue
They have a budget gap of £48.6m in 2025/26 (on a budget of roughly £440m). That's even after making savings of £12.5m
They drew down reserves worth £15m to close the gap to £33.6m
They have a budget gap of £48.6m in 2025/26 (on a budget of roughly £440m). That's even after making savings of £12.5m
They drew down reserves worth £15m to close the gap to £33.6m
Reform-led Worcestershire County Council (WCC) have published a briefing about their financial position, explaining why they might have to raise council tax by 10%
It's a pretty perfect encapsulation of the extreme financial pressures facing most local authorities
Key points 👇
It's a pretty perfect encapsulation of the extreme financial pressures facing most local authorities
Key points 👇
October 24, 2025 at 9:48 AM
Reform-led Worcestershire County Council (WCC) have published a briefing about their financial position, explaining why they might have to raise council tax by 10%
It's a pretty perfect encapsulation of the extreme financial pressures facing most local authorities
Key points 👇
It's a pretty perfect encapsulation of the extreme financial pressures facing most local authorities
Key points 👇
This has severe implications for LAs' finances and govt's political hopes
LAs are spending ever more of their budgets on social care
2009/10: 53% on adult and children's social care
2024/25: 69%
More spending for basically flat activity, while cutting other services = political kryptonite
LAs are spending ever more of their budgets on social care
2009/10: 53% on adult and children's social care
2024/25: 69%
More spending for basically flat activity, while cutting other services = political kryptonite
October 21, 2025 at 8:38 AM
This has severe implications for LAs' finances and govt's political hopes
LAs are spending ever more of their budgets on social care
2009/10: 53% on adult and children's social care
2024/25: 69%
More spending for basically flat activity, while cutting other services = political kryptonite
LAs are spending ever more of their budgets on social care
2009/10: 53% on adult and children's social care
2024/25: 69%
More spending for basically flat activity, while cutting other services = political kryptonite
That means that LAs will continue to spend more, while struggling to increase the amount of care they provide
Access will likely continue to stagnate, as it has for the last few years and a return to anywhere near 2010s levels is unimaginable (though also may not be needed)
Access will likely continue to stagnate, as it has for the last few years and a return to anywhere near 2010s levels is unimaginable (though also may not be needed)
October 21, 2025 at 8:38 AM
That means that LAs will continue to spend more, while struggling to increase the amount of care they provide
Access will likely continue to stagnate, as it has for the last few years and a return to anywhere near 2010s levels is unimaginable (though also may not be needed)
Access will likely continue to stagnate, as it has for the last few years and a return to anywhere near 2010s levels is unimaginable (though also may not be needed)
An effect that's harder to quantify is the govt's decision to end the health and care visa
The sector has become increasingly dependent on staff from outside the UK and EEA
2019/20: 8% international staff
2024/25: 24%
Ending the H&C visa will make it harder for the sector to recruit from abroad
The sector has become increasingly dependent on staff from outside the UK and EEA
2019/20: 8% international staff
2024/25: 24%
Ending the H&C visa will make it harder for the sector to recruit from abroad
October 21, 2025 at 8:38 AM
An effect that's harder to quantify is the govt's decision to end the health and care visa
The sector has become increasingly dependent on staff from outside the UK and EEA
2019/20: 8% international staff
2024/25: 24%
Ending the H&C visa will make it harder for the sector to recruit from abroad
The sector has become increasingly dependent on staff from outside the UK and EEA
2019/20: 8% international staff
2024/25: 24%
Ending the H&C visa will make it harder for the sector to recruit from abroad
The pattern is unlilely to change under this govt
Even a relatively large increase in spending in 2025/26 could be eaten up by economy-wide inflation, another above inflation increase in the NLW and the decision to increase employers' national insurance contributions at last year's budget
Even a relatively large increase in spending in 2025/26 could be eaten up by economy-wide inflation, another above inflation increase in the NLW and the decision to increase employers' national insurance contributions at last year's budget
October 21, 2025 at 8:38 AM
The pattern is unlilely to change under this govt
Even a relatively large increase in spending in 2025/26 could be eaten up by economy-wide inflation, another above inflation increase in the NLW and the decision to increase employers' national insurance contributions at last year's budget
Even a relatively large increase in spending in 2025/26 could be eaten up by economy-wide inflation, another above inflation increase in the NLW and the decision to increase employers' national insurance contributions at last year's budget
What's been driving that?
One key driver is the national living wage (NLW) which has risen more than 80% in real terms since 2015/16
That's a worthy policy goal, but because ASC staff are paid so little, an increase in the NLW means providers have to pay staff more, increasing councils' costs
One key driver is the national living wage (NLW) which has risen more than 80% in real terms since 2015/16
That's a worthy policy goal, but because ASC staff are paid so little, an increase in the NLW means providers have to pay staff more, increasing councils' costs
October 21, 2025 at 8:38 AM
What's been driving that?
One key driver is the national living wage (NLW) which has risen more than 80% in real terms since 2015/16
That's a worthy policy goal, but because ASC staff are paid so little, an increase in the NLW means providers have to pay staff more, increasing councils' costs
One key driver is the national living wage (NLW) which has risen more than 80% in real terms since 2015/16
That's a worthy policy goal, but because ASC staff are paid so little, an increase in the NLW means providers have to pay staff more, increasing councils' costs
Why not?
The cost of providing care has pretty consistently outstripped economy-wide inflation since 2015/16
There is no setting or age group which hasn't seen relatively large real-terms increases in cost of care
The highest (nursing care for adults 65+) has risen more than 40% in real terms
The cost of providing care has pretty consistently outstripped economy-wide inflation since 2015/16
There is no setting or age group which hasn't seen relatively large real-terms increases in cost of care
The highest (nursing care for adults 65+) has risen more than 40% in real terms
October 21, 2025 at 8:38 AM
Why not?
The cost of providing care has pretty consistently outstripped economy-wide inflation since 2015/16
There is no setting or age group which hasn't seen relatively large real-terms increases in cost of care
The highest (nursing care for adults 65+) has risen more than 40% in real terms
The cost of providing care has pretty consistently outstripped economy-wide inflation since 2015/16
There is no setting or age group which hasn't seen relatively large real-terms increases in cost of care
The highest (nursing care for adults 65+) has risen more than 40% in real terms
After large cuts in the first half of the 2010s, spending on adult social care rose consistently from 2014/15
Spending will likely rise further in this parliament after the govt increased funding for local govt
But even with that, there's good reason to think it won't improve access or performance
Spending will likely rise further in this parliament after the govt increased funding for local govt
But even with that, there's good reason to think it won't improve access or performance
October 21, 2025 at 8:38 AM
After large cuts in the first half of the 2010s, spending on adult social care rose consistently from 2014/15
Spending will likely rise further in this parliament after the govt increased funding for local govt
But even with that, there's good reason to think it won't improve access or performance
Spending will likely rise further in this parliament after the govt increased funding for local govt
But even with that, there's good reason to think it won't improve access or performance
NEW REPORT: adult social care is putting immense pressure on local authorities' budgets, but there's no real evidence of improved access
Since 2016/17, spending on long-term care: ⬆️25%
People receiving LT care: ⬆️1%
What's going on?
Findings from our new report on adult social care🧵👇
Since 2016/17, spending on long-term care: ⬆️25%
People receiving LT care: ⬆️1%
What's going on?
Findings from our new report on adult social care🧵👇
October 21, 2025 at 8:38 AM
NEW REPORT: adult social care is putting immense pressure on local authorities' budgets, but there's no real evidence of improved access
Since 2016/17, spending on long-term care: ⬆️25%
People receiving LT care: ⬆️1%
What's going on?
Findings from our new report on adult social care🧵👇
Since 2016/17, spending on long-term care: ⬆️25%
People receiving LT care: ⬆️1%
What's going on?
Findings from our new report on adult social care🧵👇