Agenda item

The Impact of the Energy and Cost of Living Crises on Caring for Vulnerable Adults - An Introduction

Officers will be in attendance to provide the scrutiny panel with a general overview and introduction to the topic.


The investigation will focus on matters including:


·        The impact of increased costs on care home and home care provision;

·        Government funding and the impact of increased costs on Adult Social Care funding / budgets; and

·        The impact of winter pressures.


The panel will be asked to consider the information provided and next steps for the review.


It was agreed at the last panel meeting that an additional topic would be added to the work programme, i.e. ‘The Impact of the Energy and Cost of Living Crises on Caring for Vulnerable Adults’.  The Overview and Scrutiny Board had subsequently approved the addition of this item at its meeting on 21 September 2022 (as part of the Scrutiny Chairs Update).


The Director of Adult Social Care and Health Integration and the Head of Strategic Commissioning and Procurement were present at the meeting to deliver a presentation to Members.  The information was presented in two parts.  The first part focused on ‘The Cost of Living Impacts on Adult Social Care’, and the second part focused on the risks and potential impact of the crises on both Adult Social Care and the wider directorates of the Council.


In terms of ‘The Cost of Living Impacts on Adult Social Care’, the following matters were raised:


-        By way of background, Members were advised that some of the issues experienced had recently been addressed by the government’s Mini-Budget, which was delivered on 23 September 2022.  However, some independent sector organisations that delivered services to vulnerable adults, and who continued to face pressures, had verbalised these to officers within Adult Social Care.

-        Homecare consisted of domiciliary care providers delivering services in clients’ own homes and in residential care settings.  Supported Living and Extra-Care Housing facilities were predominantly shared housing with care providers visiting; residents had their own tenancies in place and therefore faced the same pressures as other Middlesbrough residents, i.e. increased bills.  Mention was made of the Welfare Strategy discussed at the last panel meeting in assisting support recipients.

-        In terms of current issues being faced by providers, these were identified as follows:




-        A number of external factors had caused significant issues in respect of fuel, which had created an almost ‘perfect storm’.  In terms of the pandemic, the price of crude oil had fluctuated around the lockdown periods, and demand changed as businesses closed and then reopened.  Reference was made to the ongoing war in Ukraine, and the decreasing value of the pound versus the (oil costed) dollar.

-        Adult Social Care had five approved business providers for the delivery of domiciliary care; approximately 13,000 hours of homecare was commissioned per week.  An element of this was delivered by local staff able to walk and cycle to their clients’ homes, however, due to workforce pressures, there was an increasing reliance on drivers.  The viability of care work had decreased for many people, predominantly due to the rise in the cost of living and competition from other industry recruiters, such as retail.  It was indicated that a wider strategy around recruitment was required, as it was difficult to compete with organisations paying a higher wage.

-        In the period December 2021 to August 2022, fuel had increased by 26%.  When tendering for homecare contracts, providers needed to consider care workers’ hourly rate, which took into account insurance, registration fees, mileage fees, etc.  As a portion of the hourly rate was for mileage, and to try and maintain stability in the workforce, officers facilitated an additional fuel payment tracked against fuel prices.  A temporary (three-month) increase of 26p was subsequently applied to mileage payments.  The estimated cost of this for the three months was £26,300, which was dependant on the number of hours of care delivered.  Adult Social Care would continue to track the wholesale fuel price levels and review the baseline in three months’ time.

-        It was indicated that during school holidays and winter periods, it was difficult to recruit/retain homecare workers.  However, it was highlighted that Middlesbrough was faring far better than other areas, as some currently had a waiting list of 200 packages; Middlesbrough did not operate a waiting list.  It was emphasised that the reason for this was the excellent work of the Commissioning Team, and the relationships that had been built with partners.  The significant issues being experienced by other authorities fed into other areas such as hospital discharge, and therefore Middlesbrough’s position was especially positive.


       Residential Care


-        It was explained that care homes usually obtained energy supply under fixed rate deals.  Some of these terms may have been for three years-plus, others to the end of 2023.  Some care homes were fixed until February/March 2023 and were already approaching Adult Social Care and verbalising concerns. 

-        Care homes worked with brokers to identify deals.  The issue creating concern was that although the Government had capped KWPH rates for businesses, standing charges had not been capped.

-        In terms of potential increases, as an example comparison, one care home had advised that the cost of gas (KWPH) in October 2021 was £2.16, and £22.6 KWPH (a ten-fold increase) in mid-September 2022.  In terms of electricity, in February 2021 this was 15.68 KWPH, and 71.8 KWPH in mid-September 2022.  Cost-wise, for a typical 32 bed care home, this would equate to an increase from £20,000 to £160,000 per annum, or equivalent to an £85 per week, per resident, increase in fees (£3.5m).

-        It was indicated that the energy price cap had not filtered through to brokers as of yet, and the figures provided were pre Mini-Budget.  Care homes had no choice in whether to switch on their gas and electricity as they needed to keep residents warm, and therefore exactly what this would entail for those approaching the end of fixed rate deals remained to be seen.

-        From the Council’s perspective, in April 2022 the authority gave providers a highest ever inflation award of 9%, which was the highest in the North East and did provide much needed assistance.

-        At present, there had been no further support packages announced from the government for additional energy pressures for the vulnerable sector, other than the package announced in the Mini-Budget.


      Supported Living / Extra Care Housing Facilities


-        As tenants held individual contracts with energy suppliers, the increased bills being seen by all domestic households were being experienced by residents in these properties too.


Across the board, another pressing issue reported by providers concerned insurance premiums, which had increased significantly in the aftermath of COVID-19.  In some cases, providers could not acquire insurance.


After concluding this part of the presentation, the officers responded to several queries from Members.  The following information was provided in response:


  • In relation to the £400 energy bills discount to support households this coming winter, it was explained that care homes did not qualify for these payments because they were classed as businesses, not residential.
  • In terms of insurance, the panel was advised that this was for public liability purposes.  During the pandemic, COVID-19 was viewed as an unusual circumstance and opened the way for potential legal challenge; mention was made of public inquiries that had been established to investigate handling of the pandemic and how that affected insurers.  Notably, insurance companies had subsequently increased the cost of premiums.
  • Regarding workforce pressures, reference was made to the internal pressures that Adult Social Care faced, which were the subject of a previous review by the panel.  In addition to this, the independent sector struggled to recruit to care homes and care work in general because of competition by other sectors, such as retail.  It was highlighted that care work was a vocation and the workforce should be commended for the valuable work that they did.  A larger piece of work was needed around this.  The domiciliary care workforce was highly skilled and everyone involved delivered such a significant and important role – they could not be praised enough.
  • In terms of carers’ travel options, it was commented that this could potentially be linked in with the Green Strategy- through the provision of grants for electric bikes, for example.
  • In respect of fuel charges and fixed rate arrangements, the length of these were different for all the providers.  Some may have been fixed for several years, whereas others may have organised them as part of a national deal.  New longer term deals were not as frequent now, with more shorter term options now being presented.  It was anticipated that the current energy issues would be experienced for a further two years before any decreases would be seen.  There was enormous concern for care homes in that many would have failed to cope with the rate increases if not in fixed rate deals.


The second part of the presentation focused on the risks and potential impact of the cost of living and energy crises on both Adult Social Care and the wider directorates of the Council. 


By way of background, like most Local Authorities in the area, the Council was building a plan to support vulnerable individuals at a time when finances had never been more challenging.  A Wider Leadership Management Team (WLMT) session had been held for the individual directorates to come together and coordinate the response to the cost of living crisis.  The following matters, as discussed at the WLMT session, were detailed to the panel:


-        Regarding potential risks, the cost of living crisis could adversely impact by increasing demand for services, and increase the cost of delivering services (inflation, pay award and utility costs).  If these risks were not mitigated, the following may occur:


§  Increased number of children living in poverty;

§  Increase in the number of children needing to be cared for by the Council;

§  Increased suicide rates and increased demand for Mental Health services (potentially more so as a consequence of this than from COVID-19 and the associated isolation/pressures);

§  Increased volume of domestic abuse incidents;

§  An Increase in alcohol and substance abuse;

§  Additional pressures on the voluntary sector and reduced services from them (the Council needed to consider how it worked to support the VCS in order for the VCS to provide reciprocal support to the Council);

§  More hospital and care home admissions from people unable to remain safely in their homes;

§  An increase in household debt and reduced ability of the population to spend money in leisure and entertainment sectors could see the town centre collapse and reduce business rates; and

§  Care providers’ increased costs put care provision at risk.


-        In terms of the impact to date within Adult Social Care, the following was highlighted:


§  Access Team – no increased referral rate but an increase in individuals presenting with issues relating to poverty/food parcels was anticipated.  Reference was made to Staying Included groups, which were a legacy of Ageing Better Middlesbrough.  More people had been attending sessions to keep warm and have a hot drink.

§  Mental Health Teams – no obvious impact on referral rates; increased anxiety regarding inflation/costs being observed. 

§  Housing Support/Homelessness – not seeing impact on presentations yet but increased calls around anxiety on housing security.  An increase in presentations in 3 to 4 months’ time was anticipated.

§  Domestic Abuse – no obvious increase in referral rates, but an increase in the number of victims reporting as “hungry” at point of presentation.

§  Prevention Services – increased use of Staying Included groups.


-        Regarding action currently underway, work was taking place within individual directorates, as follows:


§  Adult Social Care: “Winter Warmth” activities/campaigns.  It was explained that heaters had been issued previously, but whether this was appropriate this year given the rising cost of energy had been considered.  Mention was made of heated blankets, which were less expensive to operate.  Clothing and accessories, such as hats, gloves, fleeces, jumpers, etc. would be provided, and funding to increase supplies this year was being identified.

§  Public Health: working to identify people who may have struggled to afford to heat their home and were vulnerable to adverse effects of low temperatures on their health, and develop a plan to support.

§  Children’s Services: looking to identify people at particular risk of heat or eat known to the Early Help team to identify those at risk and put in place plans to support them.

§  Finance and Governance: review of the Medium Term Financial Plan and taking action to sustain Council funds to support people.

§  Finance and Governance: review of organisational savings to mitigate the mid-year impacts of inflation.

§  A range of government interventions were being announced and the Council was responding/delivering as required.


-        In addition to action being taken specifically by Middlesbrough Council, a multi-agency task sponsored by the Health and Wellbeing Board was also currently underway.  A task and finish group was looking at vulnerable risk groups to identify who was most at risk of harm from a cold house; what the local support offer was; and the ways in which the demand could be connected to the offer in order to minimise risk to health.  The project would triangulate and coordinate NHS and Adult Social Care information to provide appropriate support by ensuring that those requiring support were successfully linked to services.


Following conclusion of the presentation, Members asked a series of questions of the officers; the following matters were considered:


-        In terms of identifying vulnerable people, this was a significant challenge and it was indicated that not every vulnerable individual would be identified.  Appropriate ways to communicate with the cohort were currently being devised.  Consideration was given to the various facets and challenges involved, and the role of the Voluntary and Community Sector (VCS) in assisting with this.  However, the VCS too were significantly under resourced, with volunteers impacted by the cost of living and therefore not always able to make themselves available.

-        A Member congratulated the team at looking at both the strategic and practical levels associated with this, but expressed significant concern in terms of the projected increases in some areas, with no real hope of an early resolution.  It was felt that national change was possible and needed to be actively pursued.  Locally, deficits were being faced and the Member wished to see a way of committing to the future support of the teams and to the retention of preventative services, including the VCS.  In response, reference was made to the statutory duty to support those accessing such services as Mental Health; Council funding and impending budgetary challenges; the differences between the VCS and prevention services; the national recruitment crisis facing Adult Social Care; and current vacancies that existed within teams. 

-        Members wished to convey their gratitude to all of the teams for working through such very challenging times, and felt reassured that matters were being actively considered.


In terms of next steps, the panel felt that, having received the information, it would be more appropriate to revisit this topic for periodic updates, rather than as a short-term scrutiny investigation.  The following suggestions were made and subsequently agreed by the panel:


  • In respect of the ‘impact to date’ and ‘action currently underway’ elements of the presentation, the Director of Adult Social Care and Health Integration would provide an update at the 30 November 2022 panel meeting.
  • With regards to care home operational costs and fees that were chargeable, the Head of Strategic Commissioning and Procurement would provide an update at the 8 February 2023 panel meeting.


The Chair thanked the officers for their attendance and contributions to the meeting.




  1. That the Director of Adult Social Care and Health Integration would provide an update to the panel on 30 November 2022, in relation to the impact of the cost of living crisis and the action taken in respect of it.
  2. That the Head of Strategic Commissioning and Procurement would provide an update to the panel on 8 February 2023, in relation to care home operational costs and fees that were chargeable.
  3. That the information, as provided, be noted.