Chancellor Rachel Reeves has allocated extra funding for local government to spend on social care.

In her Budget speech in the House of Commons this afternoon Reeve said: “To repair our public services, we also need to work alongside our mayors and local leaders. We will deliver a significant real terms funding increase for local government next year including £1.3 billion of additional grant funding to deliver essential services, with at least £600 million in grant funding for social care.”

Professor Martin Green, chief executive of Care England, said: “Today’s Budget is a glaring missed opportunity by a government full of promises to make a real difference to adult social care and establish a sustainable funding framework that meets the gravity of our current crisis. The government’s £600 million commitment to be shared between adult social care and children’s services is, unfortunately, a drop in the ocean compared to the staggering £2.4 billion in rising costs associated with wage increases and employer national insurance contributions. When we see £22.6 billion directed towards the NHS, it’s disheartening that social care once again receives only a fraction of the support it needs, despite its critical role in easing NHS pressures

“Adult social care is not simply a supplementary service but a core component of our healthcare system enabling timely hospital discharges and ensuring thousands receive safe, dignified care at home or in their communities. Social care stands as a solution to many challenges facing the NHS. Yet, this Budget and this government fail to recognise its vital role. Without immediate, adequate funding, the cost of inaction will be devastating; delayed hospital discharges, overstretched providers, and vulnerable people left without the care they desperately need.

“The reality is that without serious investment in adult social care, the government is choosing short-term savings over long-term stability. We needed a bold step forward, a signal that adult social care matters to the fabric of our society. Instead, today’s announcement leaves the sector struggling to cover basic costs, pushing it further toward a point where both capacity and access will inevitably decline. If the government truly wants to create a more resilient health and care system, it must support social care with the same commitment it shows the NHS.”

Sarah Jones, chief executive at Anchor, a not-for-profit provider of housing and care for people in later-life, commented: “We were disappointed to see social care funding reform overlooked once again and urge the government to bring forward details of its plans for the sector as soon as possible. With an ageing population, funding reform is key to futureproofing both social care and the NHS. Addressing this issue will benefit not only the older people of today but those of tomorrow.” 

Jo Henney, chief executive of Nugent, a social care charity with 18 services supporting more than 6,000 people in the Liverpool City region said: “There are no fast fixes and shortcuts in today’s budget but I am encouraged that what the Chancellor has set out will result in real change for the economy and our essential services over the next five years and beyond. 

“I’m delighted to see acknowledgement for care workers with the increase in the Carers’ Allowance, meaning that they can keep more of their money while doing one of the most important and demanding jobs.

“However, I cannot ignore the financial implications that raising employer National Insurance will cause as a charity leader; more clarity on how the third sector will navigate this rise in tax would have been appreciated. 

“In the immediate future, this rise in employer National Insurance will mean less money is available for core missions and initiatives within charities and could affect the essential services that we provide – making ‘need to haves’ into ‘nice to haves.”

Findlay MacAlpine, chief executive of Preferred Homes, said: This was the most important fiscal event of the past decade and funding for affordable housing will be welcomed by registered providers.  While there was additional money for social care, we still await a much-needed strategy to address the root causes of the care crisis.

“A shortage of extra care housing supply means elderly people often move into institutional care homes before they need to, or live in family homes until they reach a crisis point and need to rely on the NHS.  Specialised, affordable, and fit-for-purpose housing can allow people to retain their independence while having access to care when necessary, in a home developed with their needs in mind.

“Housing, health and care needs have to be considered together.  The new government’s ‘mission led’ approach provides a chance to cut across departments and do exactly this.  Building more extra care housing can free up housing supply in the wider market, save money for the NHS and local authorities and – most importantly – help older people to live well.   So while it is excellent to see a renewed focus on social housing, we must ensure that a good proportion of these new homes are built for older people.”

Richard Keyse, co-founder and chief executive of healthtech company Andi said: “We welcome the Chancellor’s decision to provide a £1.3 billion real term funding increase to local government, with £600 million set aside for social care. Local authorities must ring-fence part of this money for adult social care to meet the looming two-year deadline to switch telecare from analogue to digital.

“Investing in these new smart, preventative digital solutions will allow the elderly and vulnerable to stay in their own homes for longer, increasing their happiness and wellbeing as well as reducing costs to the taxpayer by millions. Without this technology, our care sector will be trapped using 1980s technology for at least another five years.”