State of play
The Caritas state of play alert on key regulatory changes on the horizon
Public services modernisation
The Open Public Services White Paper was published on 11 July and commits the government to giving charities, social enterprises and voluntary groups a much bigger role in public services. Charities minister Nick Hurd has confirmed that a ‘roadmap’ will shortly be published to inform civil society organisations of the practical new opportunities opening up to deliver these services.
The listening period will take place between July and September, after which the government will set out an implementation programme.
Hannah Terry, head of policy and public affairs at CAF observed that the government would need to ensure all commissioners were empowered to value social impact over pure cost considerations and that access to capital was available for payment by results deals.
Patrick Butler, writing in the Guardian on 13 July remarked on the white paper being launched the same day that the Southern Cross, the beleaguered owner of 750 care homes went into administration (http://tinyurl.com/6lx5uhq).
Status: Listening period
www.cabinetoffice.gov.uk/resource-library/open-public-services-white-paper
Social enterprise and social value
The public services (social enterprise and social value) bill aims to strengthen the social enterprise business sector and make the concept of 'social value' more relevant and important in the placement and provision of public services. The bill:
- places a duty on the secretary of state to publish a 'national social enterprise strategy' to encourage engagement in social enterprise;
- amends section 4 of the Local Government Act 2000 so that local authorities are required to include in their sustainable community strategy proposals for promoting engagement with social enterprise in their area. They must also include a statement of the measures suggested to enable social enterprise to participate in implementing these proposals; and
- requires local authorities, when entering into public procurement contracts, to give greater consideration to economic, social or environmental wellbeing during the pre-procurement stage.
Status: Committee stage to be announced.
Health and welfare
Social care costs
The Commission on Funding of Care and Support has presented its findings to the government in its report Fairer Care Funding, (the Dilnot report) published on 4 July 2011.
The independent commission was asked to recommend a fair and sustainable funding system for adult social care in England. Recommendations included:
- Individuals’ lifetime contributions towards their social care costs – which are currently potentially unlimited – should be capped. After the cap is reached, individuals would be eligible for full state support. A cap of £35,000 was suggested as the ‘most appropriate and fair figure.’
- The means-tested threshold, above which people are liable for their full care costs, should be increased from £23,250 to £100,000.
- National eligibility criteria and portable assessments should be introduced to ensure greater consistency.
- All those who enter adulthood with a care and support need should be eligible for free state-support immediately rather than being subjected to a means test.
- The Commission estimates that its proposals – based on a cap of £35,000 – would cost the state around £1.7bn and the report’s authors anticipate this will encourage the take-up of insurance schemes to further cover individual long-term care costs.
- Costs to the treasury could be covered by a ‘specific tax increase’
Andrew Dilnot, chair of the Commission said: “Under our proposed system everybody who gets free support from the state now will continue to do so and everybody else would be better off. Putting a limit on the maximum lifetime costs people may face will allow them to plan ahead for how they wish to meet these costs. By protecting a larger amount of people’s assets they need no longer fear losing everything.”
Status: Government response due in Spring 2012, with proposals for the reform of adult social care to follow in a white paper.
Accounting
PBEs spared having to adopt EU IFRS standards
The following decisions were made by the Accounting Standards Board on 16 June 2010:
- to remove from FRED 43 and 44 the requirement for publicly accountable entities to prepare accounts under EU-adopted IFRS. As a consequence the application of EU-adopted IFRS will not be extended beyond the current requirements in law;
- to change the principles for amending the IFRS for SMEs to permit or require accounting options that exist in current UK and Republic of Ireland Financial Reporting Standards at the transition date that align with EU-adopted IFRS; and
- to defer the effective date to 1 January 2014.
See the CFDG briefing paper at http://tinyurl.com/3oygtua
and the online Caritas news story at: http://tinyurl.com/6yqd5ac
Status: Consultation on three-tiered frame work closed 31 July and new Charity SORP consultation expected in 2012
Author: Clarissa Dann
Clarissa Dann was the editor of Caritas as well as an HR and management online service,he People Bulletin until July 2011.
She is now the editor of the specialist trade finance magazine, Trade and Forfaiting Review which can be viewed at www.tfreview.com but does write on charity finance and investment from time to time.
Clarissa has a background in legal and professional publishing, as well as business journalism and holds an MBA from
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