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Capping homecare funding

Money iStock 000008683901XSmall 146x219Has the Care Act changed the legality of policies which cap homecare funding? Jonathan Auburn considers the issues faced by local authorities.

Local authorities, under pressure to reduce spending, have for a number of years been considering, and some implementing, policies which limit the funds they will provide to an individual living in their own home, such that the local authority in the normal course of events will decline to pay more than the cost of appropriate care in a suitable care or nursing home.

In the last few months Southampton City Council consulted on a proposal to introduce such a scheme, whereby it would review all care packages costing over £500 for people with physical or learning disabilities who were supported at home, and if the person’s needs could be met for less cost in a care home, then the budget would be set at the cost of that placement.

Southampton’s proposal was far from unique. Numerous councils either have or are proposing to implement similar policies. In Southampton’s case, the proposal attracted widespread attention, and a backlash. Two weeks ago the proposal was dropped.

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The furore on the South coast prompts us to consider the issue more generally. Are such policies lawful, and if so, what are the requirements for legality?

Pre-Care Act 2014 law: D v Worcestershire

The case of R (D) v Worcestershire County Council [2013] EWHC 2490 (Admin) is generally cited as authority for the proposition that local authorities may lawfully operate a policy such as that described above. In that case Worcestershire was certainly operating a policy of the type described here, and the judicial review challenge was dismissed. However the support provided by that case to such policies may not be as strong as may be assumed.

The challenges brought in that case were the well-worn ones of consultation (alleged failure to provide consultees with sufficient information to enable them to make a sufficiently informed response) and breach of the public sector equality duty. Interestingly, there was no wider root-and-branch challenge to the approach or principle underlying such a policy. That is unfortunate, as it means the impact of the case is rather limited. The case goes no further than demonstrating that such a policy may survive consultation and public sector equality duty challenges. It does not support a deeper proposition that such policies are lawful when judged against fundamental principles underpinning social care legislation.

Impact of the Care Act 2014

D v Worcestershire was decided prior to the coming into force of the Care Act 2014. Should the Act now lead to a different result now? In my view, yes.

First, it is worth noting that the provisions which one would expect to be the most likely to bear on the issue, the Care and Support and After-care (Choice of Accommodation) Regulations 2014, do not really affect this issue. The right of preference in regulation 2 of those Regulations applies only to preferences expressed for care home accommodation, shared lives scheme accommodation, and supported living accommodation. It does not apply to the expression of a preference for care at home. In any event, regulation 3 limits the amount paid to that in the individual’s personal budget.

However that is not the end of the story. The Act brings with it an emphasis on “wellbeing”, explained in detail in section 1 of the Act. Proper account must be taken of the individual’s needs and wishes before a decision made.

Further, and more directly, there are statements buried deep in the Care and Support Statutory Guidance which are clearly against policies of the type here in issue. Annex A, paragraph 11.7 states: “At all times, the wishes of the person must be considered and respected. For example, the personal budget should not assume that people are forced to accept specific care options, such as moving into care homes, against their will because this is perceived to be the cheapest option”. And paragraph 11.22 Annex A provides that “Local authorities should not have arbitrary ceilings to personal budgets that result in people being forced to accept to move into care homes against their will”.

This is supported by paragraph 1.18 of the Guidance, which makes “independent living” a “core part of the wellbeing principle”, also stating that wellbeing “includes matters such as individual’s control of their day-to-day life, suitability of living accommodation … and crucially, requires local authorities to consider each person’s views, wishes, feelings and beliefs …”. Paragraph 1.19 of the Guidance states that the principle of well-being covers the “key components of independent living”, and that supporting people to live “as independently as possible, for as long as possible” is a “guiding principle of the Care Act”.

The Care and Support Statutory Guidance has (as the name suggests) a statutory basis, underpinned by section 78 of the 2014 Act. Guidance, even statutory guidance, does not have to be slavishly followed: R (Khatun) v Newham LBC [2005] EWCA Civ 55, [2005] QB 37, para 47. However, a local authority will usually be required to act in accordance with statutory guidance unless there is a good reason for departing from it: R v LB Islington, ex p Rixon (1996) 1 CCLR 119, QBD, 123; R (TG) v Lambeth LBC [2011] EWCA Civ 526, [2011] 4 All ER 453, para 17. I doubt that financial pressure alone would suffice.

Interestingly, in the Worcestershire case, the local authority assured the claimant that the policy would not lead to the person having to move into residential care. However it is difficult to see how that would be the case generally. If any such policy is to achieve its aim of saving money, it can only do this by imposing on individuals, cheaper care arrangements than they would otherwise wish for.

Policies and individual decisions

What has been said above has been directed primarily to local authority policies. It does not, or should not, require local authorities to fund individuals in their own homes if in the individual case the local authority considers the cost involved to be unjustifiable having regard to their other competing financial obligations. Local authorities can still decide in individual cases to limit funding to that sufficient to pay for a particular suitable care home placement, providing the decision is taken lawfully.

Further legal hurdles

The further legal requirements of any such policy implemented as an exception to Annex A of the Guidance would include that:

(a) the public sector equality duty would need to be complied with,

(b) it is possible, though uncertain, that a local authority may be under a duty arising under common law to consult prior to deciding on such a policy,

(c) any such policy must be recorded and published,

(d) any such policy must be applied consistently with individualised assessment and decision-making. Individual cases, and the policy should not be framed in automatic, blanket or absolute terms. The policy must retain discretion to reach a different outcome in exceptional circumstances. The local authority cannot assume that a care home will always be appropriate to meet needs.

For any individual decision, as well as individualised assessment and decision-making, taking into account the views and wishes of the individual and the importance to them of remaining in their own home, there must be an actual alternative setting identified which is appropriate to meet the individual’s care needs.

If the person lacks capacity to decide whether to pay for a top-up then some mechanism needs to be found for a decision to be made on that person’s behalf.


Maximum expenditure, or funding capping policies, were popular following D v Worcestershire. The Care Act has imposed significant hurdles to their future use. It is likely to be only a matter of time until the issue is tested in the courts.

Jonathan Auburn is a barrister at 11 KBW specialising in community care and local government law. Jonathan can be contacted on 020 7632 8500 or This email address is being protected from spambots. You need JavaScript enabled to view it.. Twitter: @jonauburn11kbw

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