Proposed amendments to the National Care Service Bill could see development costs fall “substantively”, according to an updated financial memorandum.

Government decisions to retain care staff with local authorities and no longer establish care boards mean the total estimated costs of setting-up the National Care Service have fallen by almost half over the next eight financial years.

An updated Financial Memorandum sent to Holyrood’s Finance and Public Administration Committee show provisions in the Bill, as published, are estimated to cost at a minimum £229m by 2031/32.

With the government’s proposed changes, this would fall to £135m for the same period.

Upper projections estimate savings as high as £411m as a result of the changes.

Scotland’s Minister for Social Care and Mental Wellbeing Maree Todd says planned amendments to the Bill means set up costs are now estimated between £120m and £227m over the full 10 years since it was introduced.

In a long-awaited update to the financial memorandum, Ms Todd’s 134-page letter responds to the committee’s concerns around the costings of the National Care Service (NCS).

The committee told the Minister back in April that it was becoming ‘increasingly concerned’ at a lack of information on the financial implications of the Bill, and requested updated costings to allow it to continue its scrutiny.

Proposed changes

Ms Todd outlines in her letter that three main changes proposed since the Bill’s introduction in June 2022 are driving the differences in costing.

The decision to backtrack on plans to create 31 new care boards presents the greatest costings change.

Reforming integration authorities instead, she says, will eliminate costs associated with the setup, operation and governance of new entities.

Costs associated with training and support for the boards and committee members, including those with lived experience, will bring some new costs but not enough to offset ‘significant cost reductions’, according to the letter.

She says the additional costs associated with the process of transferring staff and assets to care boards will no longer be incurred thereby ‘significantly reducing’ the associated risks previously highlighted by the committee.

Accounting for this, reforming and running IAs is projected to cost £11-£16m in 2031-32, with work not estimated to start until 2026/27 according to the estimates.

With the creation of Care Boards estimated to cost £108-164m by 2031-32, this decision represents a significant cost reduction.

Meanwhile, with local authorities set to retain their responsibilities for the delivery of social work and social care services, there will be no need to transfer staff or assets.

In reaching this agreement for local authorities, says Ms Todd, the government has managed to minimise structural change and any associated ‘unnecessary disruption and cost’ while making the necessary changes to secure improvement and align with the Bill’s ambitions.

Finally, the establishment of a National Board is estimated to cost between £3m and £5m when it is fully up and running by the 1st of April 2026.

In current plans, the Board will help secure and manage the shared accountability across services involved in delivering social care.

The delivery of the Board remains under consideration – potentially to sit as a public body, though it will ‘at a minimum’ include an independent chair, representatives from local government, the NHS and people with lived experience.

Although Ms Todd writes that its ‘final shape’ is still to be agreed, the cost estimates assume the establishment of a public body.

Reflecting on the affordability of the NCS, the Programme Business Case (PBC) enclosed in the letter states that this investment is required ‘to deliver the impactful long-term ambitions and meet future demand for health and social care’.

With social work and care services in 2021-22 costing around £8.2bn and demand forecasted to increase, the PBC states that delivering the NCS represents both a necessary investment and an opportunity for efficiencies to emerge in areas like delayed discharge.

Ms Todd says the government can continue to provide updates on costs as further decisions are made through its co-design process and as other factors change.

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