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Analysis

Social care funding
Three key questions about funding in England

Published 4 September 2024
Last updated 18 June 2026
Time to read clock icon About 4 mins
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This analysis explores adult social care funding in England. It looks at spending in recent decades, how current spending compares to historical levels and whether spending is sufficient to meet the pressures facing adult social care.

Key points

This piece was last updated on 18 June 2026, using the latest available data.

  • In 2024/25, total net expenditure on adult social care in England was £28.7bn (in 2025/26 prices), having risen by an average of 3.6% per year in real terms since 2019/20 (before the COVID-19 pandemic).
  • Expenditure growth during the last parliament was higher than the historical average, as spending increased during the COVID-19 pandemic and funding originally earmarked for reform was redirected to support the delivery of existing social care services. This followed considerable fluctuations in spending, with significant growth in the late 1990s and early 2000s followed by a period of spending restraint, including real-terms reductions in the early 2010s.
  • Population changes, such as ageing and the increasing prevalence of disabilities, impact social care demand. The number of people aged 65 years and older in England increased from 9.5 million in 2014 to 11 million in 2024. Although social care spending has increased, it has not kept pace with rising demand and cost pressures. After adjusting for age, spending was 1.4% lower in real terms in 2024/25 than in 2009/10.
  • More people will need social care in the future. Just to meet the expected growth in demand from an ageing population, an additional £9.4bn could be needed in 2034/35.
 

1. How much has been spent on adult social care since 2009?

There is no national government budget for adult social care in England, unlike the NHS. Publicly funded social care is commissioned by 153 local authorities and each local authority sets its own budget, with funding mainly coming from local council tax, central government grants, business rates, user charges and transfers from the NHS.

We look at the latest data for public spending on social care, which therefore does not cover the most recent announcements on funding plans. The last year for which there are confirmed spending data on social care is 2024/25. The box below sets out further detail on our approach.

The publicly funded system for social care in England is heavily means tested and needs tested, so many people pay for their own care or turn to family carers. In this analysis, we focus on publicly funded adult social care, excluding self-funded care, informal care and unpaid care. We do not look at social care spending for children.

Our analysis mostly uses total net current expenditure on adult social care. This is referred to as ‘overall public spending’ in the Department of Health and Social Care (DHSC) Adult Social Care Activity and Finance Report for England, 2025–26, Table 4. This captures adult social care spending funded through local authorities, including locally-raised revenue and central government grants. It excludes capital charges and external income, including client contributions and NHS income. It includes specific NHS-related funding streams, including spending through the Better Care Fund (BCF). The BCF is an additional source of funding routed through the NHS budget which, depending on local priorities, may be used to fund social care services.

When it comes to more historical comparisons, we rely on a measure derived from HM Treasury Public Expenditure Statistical Analyses (PESA) data, since they go back further than the DHSC data. Further detail on how the PESA-based measure is derived is provided in Box 2.

Note that while estimates are similar, the two measures used are not directly comparable because they use different accounting frameworks and coverage. The PESA-based measure is drawn from a broader public expenditure framework and may capture some expenditure differently from the DHSC definition, such as certain capital or centrally recorded spending.

Unless otherwise specified, all spending figures are expressed in real terms to adjust for inflation and are in 2025/26 prices. To calculate real values for other years, we use a single measure of inflation, the Treasury GDP deflator. The GDP deflator is the ratio of nominal GDP to real GDP, providing a measure of the inflation rate for all goods and services produced within the economy. It reflects changes in the price levels of all domestically produced goods and services and is updated regularly to reflect current economic conditions.

Figure 1 shows that when we adjust for inflation, total net current expenditure on adult social care has risen in recent years, following a period of stagnation. Real-terms spending on adult social care declined from 24.1bn in 2010/11 to 21.6bn in 2014/15, only recovering back to 2010/11 levels by 2019/20.

Social care then received a boost in overall funding during the pandemic. In cash terms, central government provided £3.2bn and £2.2bn in COVID-related funding for 2020/21 and 2021/22 respectively, mainly through targeted grant funding. However, we estimate that ‘core’ social care funding – excluding the additional pandemic-related funds – declined from £24.0bn in 2019/20 to around £21.2bn in 2020/21 and £23.2bn in 2021/22.

Spending has increased in recent years. It increased by an average of 5.3% per year in real terms between 2022/23 and 2024/25, reaching £28.7bn in 2024/25 (in 2025/26 prices). In part, this was due to significant additional government funding originally announced for long term reform but later diverted into the existing care system. In 2023/24, more people received support from their local authorities than in 2015/16 for the first time.

Figure 1

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2. How does spending compare to historical levels?

Here, real-terms growth in social care spending is compared across different governments over time (Figure 2). To enable comparisons across longer periods, we use a measure based on Public Expenditure Statistical Analyses (PESA) data (see Box 2) rather than the DHSC measure used elsewhere. This PESA-based measure uses a different accounting framework from the DHSC, meaning that the growth rates differ slightly from those that would have been produced using DHSC data.

The adult social care expenditure measure used in Figure 2 is estimated using Public Expenditure Statistical Analyses (PESA) data. Specifically, adult social care is approximated by taking total Personal Social Services (PSS) and subtracting the components relating to family/children services and unemployment-related services.

For 2019/20 to 2023/24, published estimates are used directly. For earlier years, the series is back-cast using growth rates from earlier releases to maintain consistency over time, despite some changes in PSS definitions across publications. This approach produces a time series, assuming that alternative definitions change comparably.

Before 2001/02, expenditure on family/children services and unemployment related services cannot be separately identified within PSS. For these years, the series is back-cast using growth in total PSS expenditure instead, on the assumption it grows at a similar rate. Before 2000/01, when only UK-level totals are available, UK total PSS growth is used.

Average annual growth rates are then calculated for each parliament. Sufficient data are not yet available to estimate a post-2023/24 average growth rate.

Between 1997/98 and 2023/24, adult social care spending grew by an average of 3.2% per year. Following average annual growth of 2.9% between 2005/06 and 2009/10, social care spending fell between 2010/11 and 2014/15. Spending recovered between 2019/20 and 2023/24, exceeding the long-term average growth rate. This recovery likely reflects higher spending during the COVID-19 pandemic and government funding initially earmarked for social care reform being diverted into system delivery.

Figure 2

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3. Is funding enough to meet the pressures facing adult social care?

The adult social care sector faces increased demand from a growing and ageing population. The number of people aged 65 years and older in England increased from 9.5 million in 2014 to 11 million in 2024. Other sources of pressure include a growing number of disabled people and increasing costs of care.

Figure 3 shows the impact of inflation and demographic pressures on social care spending. Although cash spending is higher in 2024/25 than in 2009/10, real-terms funding has not kept pace with population changes. Accounting for demographic changes means that overall age-adjusted spending per person was 1.4% lower in 2024/25 than in 2009/10.

Our funding pressures analysis estimates that just to meet the expected growth in demand for adult social care from an ageing population, an additional £9.4bn (2025/26 prices) could be needed in 2034/35.

Figure 3

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Conclusion

Adult social care spending has increased in recent years, after a prolonged period of limited growth. This additional funding appears to have improved access to care: 2024/25 marked the first time that the number of people receiving long-term care exceeded 2015/16 levels, having been below in all intervening years.

Despite this, we find that spending has not kept pace with rising demand and cost pressures. Real-terms social care spending per person (taking into account population changes) was 1.4% lower in 2024/25 than it was in 2009/10. There has also been significant volatility in social care spending over time, and average annual growth between 1997/98 and 2023/24 did not come close to matching the long-term average in funding for health services over the same period (4.2%).

Since coming to power, the current government has announced additional funding for local authorities, including £3.7bn for social care authorities in 2025/26 and a further £4.6bn for adult social care by 2028/29. However, much of this funding relies on local authorities raising council tax and business rates locally, and the introduction of a Fair Pay Agreement for adult social care is likely to add further upward pressure on workforce costs.

Over the past decade, governments increasingly took a short-term, piecemeal approach to funding social care. This made it difficult to plan ahead and make best use of additional resources. The Labour government has changed the local government funding approach from 2026/27, with a longer-term settlement and fewer ringfenced grants. While these reforms may support longer-term planning, meaningful improvements to support disabled people, older people and their families will require substantial, sustained investment in social care.

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