Author Profile Picture

John Woodward

Read more about John Woodward

Why should HR care about the adult social care crisis?


HR practitioners are responsible for adapting benefits frameworks to meet changing workforce demands. Could adult social care vouchers be a tax-efficient solution for our ageing population?

Adult social care has reached breaking point. Not only is there a significant shortfall between what local authorities allocate per adult per week (£490) and what it actually costs (£600), an estimated 110,000 jobs in adult care in England are currently vacant. That’s a rise of 22,000 in the space of one year.

The existing funding system for adult social care is unfair and unsustainable, requiring those who have worked hard their entire lives to become homeowners or accrue a modest nest egg, to bridge the ever-widening funding gap. A gap that is on course to reach £3.5 billion by 2025.

The government is soon to publish its long-awaited green paper on the future of adult social care. It will hopefully include details of proposed policy reform that will aim to fix what is universally acknowledged to be a broken system.

It is likely to consider a variety of possible schemes, from care ISAs to an auto-enrolment pension-style system.

So, aside from a moral obligation, why should HR professionals care?

The aging population

It’s no secret that the population is aging. We’re living longer and working well into our seventies and beyond. Receiving a gold watch at sixty is a thing of the past.

Add to this the decline in family size and increase in women participating in the (paid) labour market, and it becomes apparent that demand for care will only increase in the future.

Savvy employers are already making changes – such as flexible working, sabbaticals or retirement planning workshops – to their employee benefits framework to accommodate the needs of an aging workforce.

But what about tomorrow’s older employees? Or employees who may take on the responsibility for coordinating and financing the care of a loved one in the future?

HR practitioners need to continuously think about the needs of their employees and how existing benefits frameworks can adapt to meet evolving workforce demands.

Employee benefits matter

We’re all familiar with the positive impact employee benefits schemes can have on a workforce – from reduced stress and absenteeism, to improved wellbeing, morale and motivation.

An appropriately tailored employee benefits framework can help to attract and retain the right talent and have a demonstrable effect on productivity and profitability too.

Yet, despite this acknowledgement, which is backed up by 69% of senior managers within SME businesses believing they have a duty to provide benefits beyond pensions, many SME owners (63%) feel unable to compete with larger employers.

Seizing the opportunity

Regardless of an organisation’s size or sector, the current adult social care funding crisis will affect all workforces. This impact will be felt both directly, in terms of how employees will access and pay for care provision in the future, and indirectly, by employees who need to support and fund a dependant’s care needs.

The latter would potentially contribute to increased absenteeism and decreased wellbeing and productivity, due to caring responsibilities.

With adult social care firmly in the spotlight, a tax-efficient means of saving for future care needs to represent an attractive benefit for many working age people. It should also represent an opportunity for employers – more specifically HR professionals – to differentiate themselves from the competition.

Responding to evolving needs

HR practitioners need to continuously think about the needs of their employees and how existing benefits frameworks can adapt to meet evolving workforce demands, whilst supporting recruitment, retention, motivation, morale, productivity and profitability.

Introducing an adult social care salary sacrifice scheme, similar in principle to childcare vouchers, would empower working age people to save in a tax efficient manner for their future care needs, or those of a dependant’s.

It would also tick a box for businesses by recognising the needs of tomorrow’s workforce and taking affirmative action to support employees. This would help deliver immediate value in terms of recruitment and retention of talent, while working towards longer-term objectives of increased wellbeing and reduced absenteeism.

Giving employees the autonomy to decide how their future care needs, or those of a loved one’s, are funded and delivered is a precious gift.

Implementing change  

Introducing an adult social care voucher scheme would be straightforward for businesses and HR professionals alike. The tried, tested and popular template for it exists in the form of childcare vouchers, which have already helped over 600,000 families.

The cost of administering the scheme would be offset by National Insurance savings, and the resource needed to manage the scheme would be minimal, as the scheme would be classed as a non-taxable benefit. Overall it would require little in the way of paperwork for either employer or employee.

Understanding the current climate in adult social care, and the radical funding reform that will hopefully result following the publication of the government’s green paper, is crucial in the bid to provide well rounded and relevant additions to existing employee benefits frameworks.

Giving employees the autonomy to decide how their future care needs, or those of a loved one’s, are funded and delivered is a precious gift and – political agendas aside – somewhat of a no brainer.

Author Profile Picture

Get the latest from HRZone

Subscribe to expert insights on how to create a better workplace for both your business and its people.


Thank you.