As adult social care costs rise, local authorities must ensure the care they’re funding has the maximum positive impact for the given budget This means agreeing with all stakeholders what makes up that impact, with an explicit focus on improved well-being for the target group, as well as cost-effectiveness.
Technology is now recognised to be part of the answer. But though this recognition is near-universal, adoption and implementation are patchy.
On the money side: many councils have now introduced technology for managing care budgets, though many have not. And on the care side: only a handful of councils mandate the use of digital social care records (DSCR).
Without the ability to manage care spending alongside care delivery and measurement of outcomes, and marry up those datasets, councils lack the means to balance cost and value in their decision-making – despite this now being a legal requirement.
Recipients of community direct payments, meanwhile, have almost no access to solutions which could allow them to manage their own support, and ultimately help drive down the costs of care.
To identify the way forward, we spoke to Paul Hainsworth of Colligo Labs, and Chris Watson of Self-Directed Futures. Both individuals have been involved in supporting the sector for over a decade, one as a former care commissioner. Their organisations work with local authorities to make better use of technology, whilst championing the cause of those who receive local authority-funded care.
The opportunity: how technology can drive efficiencies and care
In 2024, four English local authorities made the pioneering step of mandating or incentivising the use of digital social care records (DSCR) by care providers.
Dorset offered £4,000 to each care business to help them adopt care tech; Birmingham City Council took the further step of requiring such solutions to be used by any care provider that wins a tender.
It’s obvious what motivated these moves. These local authorities rightly assume that any care provider that manages its operations through technology is likely better organised, more competent, more accountable and less exposed to risk – all factors which ultimately help to control costs and improve outcomes.
Unfortunately, tech adoption in local-authority funded support remains patchy, leaving gaping holes in some areas, in particular around some of the most complex and expensive care packages.
Where tech adoption has moved more quickly, recently, is around management of the money, which is positive both for funders of care, and for supported people.
Councils are now widely adopting budget management software such as Alocura to give them better visibility of spending.
This is also welcome for supported people. Managing a personal care budget can be like running a small business, with some budgets running into the millions. Few people have had prior experience of this kind of work, so any tech that with this likely to be beneficial.
Around care management and reporting, however, the pace of change has been much slower.
Central government has incentivised the adoption of DSCR for several years now, leading to around 75% of UK care providers now using DSCR.
But, the vast majority of councils have not applied equivalent pressure, and even in those that have, personal budget holders have been overlooked.
As a result, almost nobody who receives a community direct payment has access to technology to manage their support. That equates to over £6m in care spending per local authority, per year, taking place with no software for managing, monitoring and improving support delivery.
So, while councils may be able to quantify how many of hours of support are delivered for their budgets, they have no visibility on the impact of that spending, or any ability to identify things like:
- where wastage may be occurring
- where reductions in the budget may have hidden costs, potentially exposing people to greater risk, causing them to re-enter residential care or hospital
- where changes on the support package could help people better integrate into the community, become more economically productive, or live more independent lives.
Outdated local authority procurement limits efficiency-savings in care
Under the Procurement Act 2023, which came into force in spring 2025, local government procurement is supposed to be geared towards the expected outcomes of that investment.
Of course, if you only measure the budget, but don’t measure what it’s being spent on, you can’t measure the outcomes. This means you can have no certainty about the impact of the budget and whether it is offering best value to the supported individual or the local authority.
These outcomes should be measured both at population-level, and at the level of individual supported people.
Chris Watson cites the value of…
“…strategic data that digitalisation will bring and the ability to understand populations…but I’m also fascinated at individual-level outcomes. As a sector, I’m not convinced we show the impact of services particularly cohesively: the person, understand their patterns of life, what’s important to them. There’s an opportunity to capture a richness of detail in plans that just doesn’t go anywhere on paper. But if you scale that up, there’s opportunities to extract data from people’s life patterns that can improve their lives.”
Paul Hainsworth draws attention to the potential for joined-up datasets…
“..to manage large amounts of data and distil that down to relatively simple decisions at the end of that assessment… for systems to be interoperable, mine the data sets and look for trends, ideas, examples of best practice, early warnings, etc.”
This is not revolutionary thinking; optimisation of resources is one of the main reasons that businesses licence technology. Indeed, in any sector, procurement should at least partly come from an investment mindset: buying services today which can save money tomorrow.
The trouble is this joined-up thinking is lacking in local-authority funded care, where purchasing decisions are often geared towards functional needs rather than efficiency improvements.
Lack of resources is certainly a challenge. Chris comments…
“Everything in a local authority has an opportunity cost; any programme you adopt pushes out other work you could do. Short-term savings are often prioritised over longer term strategic commissioning and market-shaping and this can be counter-productive.”
As a result, many councils are paying for expensive legacy systems almost by default…
“…wedded to outmoded infrastructure based on products that were around 10–15 years ago…”
…while they struggle to adopt modern solutions which could both lower direct cost and drive further efficiency gains.
Ultimately, this chips away at potential resources which could be funnelled into lowering the overall costs of care, not to mention improving lives for people who receive support.
Where councils can make immediate cash savings, however, is in increased use of community direct payments, instead of funnelling budgets through private care businesses.
The impact of technological inertia on people who receive support
Community direct payments are a crucial component of independence for many people: giving them the ability to hire their own care staff and procure their own services.
Yet managing one’s own care can also be described as a massive administrative burden that falls on a tiny number of people. Direct payment recipients must become an employer, with all the administrative workload that that implies.
At Total Care Manager, all the complex care packages we support have over 15 full- and part-time support professionals including support workers, managers, therapists, medical personnel and more.
Chris Watson described a recent meeting with somebody whose son receives a £300k personal budget, and who has…
“…about 30 PAs, and she is working full-time supporting her son’s arrangement. And it’s working brilliantly for her – but has she got any help with support planning? No – she’s got no access to any system. But if that was a support provider organisation, the council would be paying an hourly rate that left sufficient margin to buy in that platform.
So when we think about platforms, for me, it’s about how we enable citizens to have access to the same tools.”
Clearly, this workload isn’t for everyone. Only 26% of people eligible for community direct payments take them up; a 2024 report by the King’s Fund said that take-up is low, in some cases, because people “wonder whether it’s worth the extra work” of being an employer.
But councils cannot afford for people who could be receiving direct payments to miss out. Beyond allowing many people to live more independently, direct payments represent large and immediate savings over support delivered via private care businesses.
This chart shows the difference in cost for a moderately-complex care package, delivered either via a private care business or via a community direct payments.
In this example, based on data from the King’s Fund report, the supported individual receives one-to-one support, 24 hours a day.
Clearly, the hourly rates will vary by region; in London, they could be £10 higher and may also be £5 lower in some regions – for both agencies and PAs.
Still, based on average figures, the local authority can save £87,000 a year for every individual who receives community direct payments.
That’s enough to pay for a full year of support for six or seven people with dementia. If a council could move 10 such people onto direct payments, the savings might even be enough to run a new residential care home.
With this much money on the table, councils must maximise take-up of direct payments by offering supported people the right tools for the job.
Commissioners: put technology at the centre of community-based care
Councils, across the board, need to move beyond default usage of expensive, legacy suppliers in order to control costs and drive efficiencies.
Chris argues that the agents of change here are the commissioners, since they have the authority, understanding and budgetary control to take the necessary action.
“Although it’s brilliant to talk to senior managers and directors, it’s really commissioners who make this a reality because they’re the ones doing the work. They’re the middle-men between providers, senior managers and local authorities. And if you don’t take commissioners with you on that journey, you can talk about change all you like, but you won’t see it happen in practice.”
Some changes are harder than others; some are a mindset shift. On service provision: the usage of mainstream care providers is often an expensive reflex, rather than costed decision. Chris comments…
“There’s some great service providers out there, but we also know there’s [some] who have different agendas, maybe about extracting capital. And that money that’s pumped into social care isn’t always going into communities, it’s going out to hedge funds.”
On the tech side, Paul cites the endurance of decades-old technology companies at the expense of more modern solutions.
“We’ve got a few players who dominate the story here… people like the Access Group, System C, Civica, etc.
But you’ve then got a plethora of smaller technology vendors, and what we don’t see from local authorities is a vision for how their systems are going to join up to meet the needs of the beneficiaries of care and support funding – particularly the beneficiaries of direct payments.”
A more agile technology approach can, in turn, allow local authorities to…
“…handle larger numbers of smaller providers, who are much more embedded in their community, rather than delegate that responsibility to multi-million-pound organisations.”
To solve this, local authorities should start taking easy, affordable steps which can deliver reliable improvements today.
More councils should follow in the path of Dorset and Birmingham City Council, and incentivise the usage of DSCR by care businesses.
Crucially, “care businesses” needs to include recipients of direct payments. Individuals should not be forced to use technology. But they should at least be made aware that it’s available and how it can help them take up direct payments.
Nationally: the use of budget-management software and/or prepayment cards should be a legal requirement. The idea of a multi-billion-pound industry, funded by taxpayers yet overseen with periodical paper-based reporting, is unconscionable under growing economic pressure.
Amongst all stakeholders, recognition is due across the board that a care system that works better for council budgets is also, often, the one that works better for supported people. In Chris’s words…
“SDS is fundamentally a more efficient way of delivering support. We know the evidence is there for the outcomes… it gives people better lives.”
Optmize support budgets in your local authority, with modern technology
Alocura is a care administration systems and services for commissioners, care providers and individuals. Using the latest digital healthcare tools, Alocura improves operational efficiency, financial performance and care quality outcomes within personalised care settings for care providers. Find out more here.
Total Care Manager is the only care management platform designed specifically for complex care. We help to coordinate the support of people with complex needs, including acquired brain injury and learning disabilities, with easy-to-use, clinical-grade care records. We help local authorities by helping them to track outcomes and optimize their spending on adult social care. Find out more here.
