Purpose

Annual inflationary uplift for the independent care market. Approval required.

Decision

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.

Provision Type

Recommendation

Net increase in cost £’s

Home Care framework

Uplift from April 2026: the Urban Hourly rate by 2.32% to £23.88; the suburban hourly rate by 2.22% to £24.92; the Rural Hourly rate by 2.04% to £27.01; and the Extra Rural Hourly rate by 1.82% to £30.26; resulting in an average uplift percentage of 2.1%.

Uplift the support at home standard and enhanced hourly rate from April 2026 by 5% to £22.05 and £24.19.

Total

£995,250

£88,655

£1,083,905

Older Persons Residential Care

Increase the expected to pay rates from April 2026 by up to 12% to £837.31 per week.

£350,000

Older persons Dementia Residential Care

Increase the expected to pay rates from April 2026 by up to 6% to £897.53 per week.

£700,000

Older Persons Nursing Care

Increase the expected to pay rate from April 2026 by up to 6% to £973.60 per week (excluding funded nursing care).

£180,000

Older Persons Dementia Nursing Care

Increase expected to pay rate from April 2026 by up to 6% to £1,054.73 per week (excluding funded nursing care).

£465,000

Working Age Adults Residential Care

No uplifts from April 2026, combined with a targeted programme of work to review accommodation-based service expenditure. Uplifts to be considered later in the year (applied from December 2026), as indicated by the review programme once it has concluded.

£135,000

Supported Living and Supported Accommodation Providers

No uplifts from April 2026. Framework rates to be set on conclusion of the current recommissioning of these services. All expenditure to be included in the targeted programme of work to review accommodation-based service expenditure.

£0

Day Opportunities

Increase session rates by 4.1% from April 2026.

£148,000

Independent Living Framework (Extracare)

Increase care and support hourly and core payments by 2.96% from April 2026.

£10,000

Direct Payment increase where personal assistants are employed

Increase hourly rate for Personal Assistants (PAs) by 4.1% to meet National Living Wage from April 2026.

£215,000

Total

£3,286,905

Reasons for Recommendations

•         The National Living Wage (NLW) increase for 2026/27 is 4.1%. This compares to 6.73% in 2025/26, 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; and the impact of the Employment Rights Bill / employment reforms, including changes to statutory sick pay.

•         Our Benchmarking data which compares our expenditure as a Council with other local councils and our CIPFA comparators shows that, while our overall adult social care spend per adult is below the national average, our spend on working age adults (18–64) is materially higher than peer councils. In 2024/25 we spent £397.42 per younger adult, compared with £332.50 for England (around 19.5% higher). We also recorded higher average costs per younger adult supported than the national position. Whilst we have been working with providers, individuals, families and other experts to look at ways to address this through current recommissioning, this alone is not enough. The proposed uplift approach and targeted programme of work for working age adult (18-64) accommodation-based services (residential, supported living and supported accommodation) seeks to address this, whilst ensuring care and support is outcome focused, independence enabling and least restrictive.

•         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 6.2% (600 vacant posts) in 2024/25 (similar to 2023/24; which was 3% lower than in 2022/23) and a turnover rate of 23.4% for care providers (0.6% lower than in 2023/24). [Source: Skills for Care Workforce Intelligence published 15 October 2025.]

•         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 (23.4% turnover compared with the regional average of 24.7% and England at 23.7%; 6.2% vacancy rate lower than the regional average of 7.3% and similar to England at 6.8%). 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 reviews 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 some types of provision and to commission individual packages of care with these non-framework providers. There has been a significant decrease in the number of non-framework providers commissioned; however, 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 framework contract 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 with our framework providers.

•         Our strategy is to focus our development and commissioning activity specifically with our framework providers. 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 solely for framework providers. This enables the Council to support improvement in the quality of its framework-contracted care and support providers, secure a sustainable market of high-quality providers and secure value for money in our independent care spend.

•         A benchmarking exercise of older adults residential fees has demonstrated that additional investment is required into this segment of the local social care market. Less than 50% of placements for standard older adults residential placements have been with a framework provider. Our benchmarking has demonstrated our framework fees for these specific placements do not compare favourably with comparable authorities. This is driving an increase in higher average weekly fees for new placements. When we uplifted the Expected to Pay rate for nursing in 2025/26 by 17%, this increased the average weekly cost per person by only 1.2% to 1.4%. Utilising a similar approach, the proposed older adults residential fee uplift will increase the number of placements with framework providers, resulting in a net decrease in the cost of new standard older persons residential placements with the Expected to Pay Rate set at £837.31 for standard older persons care (12% increase) and £897.53 for more complex / dementia older persons care (6% increase). This reduction is built into the Council’s Medium Term Financial Plan.

Alternative Options Considered: The alternative options, in summary, considered included:

Option 1: Do nothing and apply no uplifts (Not recommended)

Option 2: Target uplifts only at specific service types (Not recommended)

Option 3: Combine an uplift in fees for all other adult social care framework services, with a targeted programme of work to ensure working age adult accommodation-based expenditure is in line with national benchmarks. This is to support providers in meeting the additional financial pressures including National Living Wage for frontline care workers, whilst maintaining expenditure within budgetary limits and ensuring a sustainable provider market (Recommended Option)

Option 4: Apply a reduced uplift to the whole market including non-framework and framework providers (Not recommended)