Expenditure on Social Care for Older People to 2026: Projected Financial Implications of the Wanless Report

As part of the Wanless Review of social care for older people, the King’s Fund commissioned the Personal Social Services Research Unit (PSSRU) at the London School of Economics and the University of Essex to make projections of expenditure on social services for older people. This paper presents the results of the research. It reports on projections to 2026 of demand for social services for older people and associated expenditure in England. The approach taken by the Wanless Review team is described in detail in their report, Securing Good Care for Older People: Taking a long-term view (Wanless 2006) and can be characterised as ‘normative’; projections are based on various assumptions about how, in the view of the Wanless Review team, services should be allocated to achieve stated outcomes. This represents a departure from the ‘positive’ approach taken by the PSSRU long-term care team, where projections are based on analyses of how services are currently allocated. A separate version of the PSSRU long-term care finance model has been developed to produce the analysis commissioned by the Wanless Review team. The structure and basis of the Wanless Review version of the model, however, draws on existing work carried out by the PSSRU long-term care team and established links with the CARESIM model at the University of Essex. It should be emphasised that the estimates provided by this report are not forecasts about the future; they are projections on the basis of specific assumptions about future trends. This is of particular importance to the Wanless Review version of the model as it assumes a completely different pattern of services, based on explicitly stated outcomes that, in the view of the Wanless Review team, should be delivered by social services. We can never know with any degree of certainty how people will react to changes in a system, especially one as complex as social services; we can only extrapolate how they might behave according to past behaviour. The paper has five sections. A description of the models used to produce the projections in this report is given in section two. Section three discusses the main projections. Three different scenarios are presented that model the two possible future service models commended by the Wanless Review team and a further scenario reflecting existing patterns of care. In section four we explore the sensitivity of these projections to changes in key assumptions. Section five concludes the paper with a brief discussion. This paper is one of two major research papers commissioned by The Wanless Social Care Review to help in the estimate of future trends and costs. The two research papers and a number of background papers are available on the King's Fund website .