London councils' £200m overspend on adult social care

The cost of providing care for older Londoners is driving London's local government into greater debt, a body representing the capital's boroughs has warned.

London Councils, the collective of London local government, said the capital's boroughs overspent on their adult social care budgets by £200m in 2025-26.

All 32 London boroughs will elect councillors to serve for the next four years on 7 May.

There are two types of spending for councils, statutory duties that by law they have to fund, including adult and children's social care, and discretionary spending.

The rise in the costs of statutory duties reduces the amount local authorities can spend on other services.

London Councils said last year that based on current trends in service demand and expected government funding levels, it anticipated a cumulative £4.7bn shortfall for the 32 boroughs and the City of London in the four-year period 2025 to 2029.

This four-year gap has more than doubled since 2024-25, when boroughs forecast a £2.2bn gap.

The annual budget gap estimated at £1.5bn in this financial year.

London Councils said the deficit was "driven by the relentless increase in demand for homelessness support and adult and children's social care – all statutory services where boroughs have strict legal duties and limited ability to cap their spending".

They added: "After more than a decade of boroughs making significant savings and efficiencies, further savings on this scale will be a major challenge.

"While boroughs will initially look to non-statutory services, it is likely statutory services will also be affected.

"Local provision of libraries, children's centres, waste collection, road maintenance, and sports and leisure facilities could all be impacted."

An addition to adult social care, London's local authorities collectively overspent on children's services by £110m.

Health thinktank The King's Fund reported in March that across England local authorities are having to fund spending on adult and children's social care through cuts in other areas such as waste collection, roads, libraries and leisure services.

In 2023-24, local authorities with social care responsibilities, like London boroughs, spent 61% of their total revenue on adult and children's social care compared with 57% in 2015/16.

Councils also fund spending through increases in fees and charges on people receiving care.

In 2024-25, client contributions were 32% higher in real terms than in 2015-16.

Sandip Ruparelia, the owner of a number of care homes in north-west London, said the time taken for social care assessments and recruitment are two of the biggest issues right now.

He told BBC London: "Regarding the referrals we are getting... due to the funding issues, we find it takes longer to bring the residents in the care home and the discharge from hospitals seems to be taking longer to come in the care sector."

Staffing is another major issue for the sector: care homes can offer Health and Care Worker visa sponsorship to overseas workers for roles like care assistants and senior carers.

Applicants need a job offer from an approved employer, who must be registered with the Care Quality Commission (CQC).

Ruparelia said: "Throughout the country, not only for my care home, but the entire care sector, there's a big shortage for the carers, nurses, and we do depend a lot on the sponsorship."

Caroline Russell, a Green Party member of the London Assembly, said: "One of the biggest issues is the scale of unmet need, and the fact that we don't even know how much unmet need there is.

"We've got a system that is under pressure, that has been suffering from austerity budgeting since back in 2010, so 16 years of budget cuts, year on year.

"I think that any elected Green councillors will be asking a lot of questions of officers about how they are assessing need, because if we are not even attempting to meet the need that exists, then we're going to have people who are not getting the care they need."

A Reform UK spokesman said social care funding is "fundamentally broken and demands urgent, decisive reform".

They added: "For years, successive governments have failed to act, leaving behind a system that is unsustainable, overstretched, and no longer fit for purpose.

"Reform UK councils will drive maximum efficiency and value for money within the constraints of this restrictive national framework. But tinkering at the edges is not enough.

"We are committed to closing the funding gap through meaningful national reform, including making careers in health and social care more attractive to tackle chronic workforce shortages."

Luke Taylor MP, Liberal Democrat spokesperson for London, said: "The spend on social care reached almost £30bn last year, and that's almost doubled since 2015, so council budgets are being hammered by this demand.

"The government has failed to act on our recommendation for a commission to agree sensible ways to fund things.

"What we want to see is the government get on with that, get round the table with all parties, and find a way to solve this problem once and for all."

He added: "Councils can't solve this problem on their own. Ultimately, it's the government who are leaving the local government sector in crisis."

Stuart Andrew MP, the Conservative shadow health secretary, said:

"Councils across England are being forced to pour ever more money into social care while Labour sits on its hands and commissions yet another review.

"Labour's Jobs Tax blasted a £2.8 billion hole into an already struggling care sector.

"Labour's record on social care is not new, having promised to fix it in 1997 and left office having done nothing.

"The Conservatives invested £8.6 billion in adult social care, sped up hospital discharge, and built a long-term workforce plan. Labour can't even say what their plan is because they don't have one."

A Labour Party spokesperson said: "We're spending over £700m more to help older and disabled people adapt their homes - to prevent falls, speed up hospital discharges and help them live safely and independently in their own homes.

"We're also supporting unpaid carers with the biggest increase to the Carer's Allowance since the 1970s - equal to around an additional £2,000.

"The issues facing adult social care go much deeper - and we know the sector faces financial challenges too.

"That's why the government appointed Baroness Louise Casey to lead the most comprehensive review of adult social care in a generation."

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