The financial recommendations, which were approved by the city council’s cabinet resources panel on Wednesday, are being implemented to meet the increase in the minimum National Living Wage (NLW) due to be introduced in April.
Care service providers are legally obliged to pay the rise in the living wage, which is one of the reasons the council has agreed to increase the fees paid – amounting to a total estimated cost increase of around £1.4 million.
The council’s cabinet member for adults, Councillor Linda Leach, told members: “This move is to meet the additional costs resulting from the increases to the national living wage and increases to sustain the care market.
“The impact of Covid-19 has changed the usual demand and take-up of the care service. The long-term impact cannot be predicted and the adult commissioning team will continue to review sufficiency with providers, ensuring all residents’ needs are met.
“Wolverhampton fees compared to other areas are at the lower end but are comparable to our Black Country neighbours, and we have not had any issue in purchasing extra care services during 2020 at our local agreed rate.
“We are confident that we can continue to do this during 2021 with the proposed fees.
“The financial cost to implement a supporting and robust external market is under £1.4 million and will be met from adult services care purchasing, which has a net controllable budget of £71.8 million for 2021-22,” she added.
“The council have a duty to ensure the care needs of residents in Wolverhampton are met.
“This includes reviewing the sufficiency of externally commissioned care services, and whether the current fees enable provision of care and for the council to purchase them.
“We must take into account the cost of resource impact for providers, such as the national living wage, increases within inflation and the impact of Covid-19,” said Councillor Leach.
“Extra care was taken for adults with complex needs. Providers engaged and gave us regular feedback. Home care is an area of growth in line with ambition to support people to stay at home for as long as possible.”
The costs will be funded from Adult Services care purchasing, which has a net controllable budget of £71.8 million for 2021-2022.