Decision Maker: Executive

Outcome: Recommendations Approved

Is Key Decision?: Yes

Is Callable In?: Yes

Date of Decision: March 13, 2025

Purpose: To agree the annual inflationary uplift

Content: RESOLVED   KEY DECISION   That the Executive approved an uplift in fees paid to adult social care providers to support providers in meeting the additional financial pressures including National Living Wage for frontline carers inflationary pressures from 1st April 2025.   Provision Type Recommendation Net increase in cost £’s Home Care framework Uplift: the Urban Hourly rate by 3.85% to £23.34; the suburban hourly rate by 3.7% to £24.38; the Rural Hourly rate by 3.4% to £26.47; and the Extra Rural Hourly rate by 3% to £29.72; resulting in an average uplift percentage of 3.49%.   Uplift the support at home standard and enhanced hourly rate by 6.25% to £21.00 and £23.04; and the overnight sleeping and waking rate by 4.71% to £105.46 and £162.89.   Total £819,668           £99,814             £919,482   Older Persons Residential Care and Older persons Dementia Residential Care Increase the expected to pay rates by 5% to £747.60 per week and £846.73 per week. £693,506 Older Persons Nursing Care Increase the expected to pay rate by 17% to £918.49 per week (excluding funded nursing care). NLW only would be 4.96% (applying the 6.73% NLW uplift to the staffing elements) and this represents an additional investment of 12.04% to incentivise providers to join the Council’s Frameworks. £196,198 Older Persons Dementia Nursing Care Increase expected to pay rate up to 17% to £995.03 per week (excluding funded nursing care). NLW only would be 4.96% (applying the 6.73% NLW uplift to the staffing elements) and this represents additional investment of 12.04% to incentivise providers to join the Council’s Frameworks. £413,706 Working Age Adults Residential Care Increase Tiered Payments by 5% £448,414 Supported Living Providers Increase tiered payment rates by 3.5% £911,724 Day Opportunities Increase session rates by 3.5% £101,068 Independent Living Framework (Extracare) Increase care and support tiered payments by 3.85% £14,890 Direct Payment increase where personal assistants are employed Increase hourly rate by 6.73% to meet National Living Wage £396,766 Total   £4,095,754     Reasons for Recommendations:   The National Living Wage (NLW) increase for 2025/26 is 6.73%. This compares to 9.8% in 2024/25 and 9.7% in 2023/24. In addition to this we know that providers continue to face broader inflationary pressures, in particular the impact of the changes to National Insurance in the 2024 Autumn budget that will impact in 2025/26.   The care and support market in North Northamptonshire continues to experience difficulties with the recruitment and retention of care staff with a vacancy rate of 6.8% (3% lower than in 2022/23) and turnover rate of 23.4% for care providers (0.6% lower than in 2022/23).   Whilst this is an improving trend the data continues to demonstrate that providers still face challenges in recruiting and retaining staff locally, this is evidenced by high numbers of staff working with certificates of sponsorship across all Adult Social care markets.   The ability of providers to recruit and retain a sufficient workforce has been one of the key challenges and risks for the sector for some time. By effectively targeting our annual uplifts we support our contracted care providers’ ability to develop strategic responses to workforce challenges, including offering rates of pay that are competitive with other local sectors.   The position in North Northamptonshire is in keeping with the national picture. Alongside targeting our inflationary uplifts, we continue to work in partnership with our contracted providers to make social care an attractive career proposition within North Northamptonshire.   We continue to work with providers to offer and signpost to training and development opportunities. However, fee uplifts remain a crucial lever in ensuring providers can support social care as being an attractive career option for people in North Northamptonshire.   There continues to be a need to utilise non-framework providers for many of the types of provision and to commission individual packages of care with these non-framework providers. Whilst there has been a significant decrease in the number of non-framework providers commissioned (with none required for homecare), many of these providers continue to be comparatively more expensive on a unit (hour or week) basis.   Non-framework provision can be costly to the Council and the proposed uplift seeks to positively influence existing contract framework supply through retention and sustainability whilst also incentivising an increase in supply through levering better rates of pay and reward for our framework providers. Work continues to minimise our utilisation of non-framework providers and to focus our commissioning activity solely with our framework providers.   Our strategy is to focus our development and commissioning activity specifically with our framework providers. Alongside this fee uplift we are focused on utilising our enhanced provider offer for framework providers that includes training opportunities, an enhanced quality monitoring and support function and access to other resources (such as a provider portal currently under development). This enables the Council to support improvement in the quality of its framework-contracted care providers, secure a sustainable market of high-quality providers and secure value for money in our independent care spend.   A benchmarking exercise of nursing fees has demonstrated that additional investment is required into this segment of the local social care market. Only 35% of placements for nursing care are with a contracted provider; feedback from providers is that this is because of contracted fees are not attractive and our benchmarking output has demonstrated that our contracted fees do not compare favourably with comparable authorities. This is driving an increase in off framework placements and higher average weekly fees (£1038) for new nursing care placements. The proposed fee uplift will incentivise providers to join our framework, increase the number of placements with contracted providers and result in a net decrease in the cost of new nursing care placements with the Expected to Pay Rate set at £918.49 for nursing care and £995.03 for Dementia Nursing Care. This reduction is built into the MTFP.   Alternative Options Considered: The alternative options, in summary, considered included:   Option 1: Do nothing and apply no uplifts (not recommended)   Option 2: Targeting uplifts at particular service types (not recommended)   Option 3: Uplift in fees paid to adult social care providers to support providers in meeting the additional financial pressures including National Living Wage for frontline carers  recognising inflationary pressures (Recommended Option)   Option 4: Lower uplift to the whole market including non-framework and framework providers (Not recommended)   The options are presented in more detail in section 6 of this report.