Councils warned to prepare for growing costs of ageing society

An increase in the number of older people means the cost of providing care services could almost double by 2026 at the same time as public spending cuts require local authorities to find billions of pounds in extra savings, the Audit Commission said.

But most councils do not know enough about the costs of their ageing population to take important decisions and may miss opportunities to save unless a more strategic approach is taken, it said.

Its report, Under Pressure, calls on councils in England to put the needs of older people at the heart of plans for local services and gather more information about demographics in their area.

It comes nearly two years after the watchdog warned councils to prepare for a demographic shift but it said many authorities are still not taking the action necessary and with public spending pressures mounting, they will be unprepared.

By 2026, 40 per cent of the population will be over 50 compared with 34 per cent last year, the report said – leading to serious financial challenges.

In a series of recommendations, it suggests small investments in services such as housing and leisure could reduce care costs and improve well-being.

And it urges councils and partners to work together to tackle the causes of social care need such as poor housing, health problems and social isolation.

"In the current financial climate, councils need to prepare for hard choices and make decisions about fairness and rationing of services," the report says. "At the same time, they need to ensure that cuts do not simply fall on those 'soft' targets that contribute to older people's well-being and can generate long-term savings."

Audit Commission chairman Michael O'Higgins said: "There are huge financial pressures on councils in the years ahead, but re-designing services and exploiting technology can make them better, more efficient and more personal.

"Some councils are showing the way, tackling the causes of ill-health and social isolation, reducing the need for expensive social care and helping people live well in later life."

Reform of care for the elderly has been at the heart of bitter political feuding in recent days, with Labour and the Tories accusing each other of sabotaging attempts to find a cross-party consensus on the issue.

Health Secretary Andy Burnham, Tory counterpart Andrew Lansley and Liberal Democrat spokesman Norman Lamb held secret talks on the issue, only for them to break up in acrimony. And Mr Lansley looks set to boycott an emergency conference on care reform called by Mr Burnham, saying he would attend the non-partisan event only if Labour ruled out introducing a 10 per cent death duty on estates to pay for an expansion of care for older people.

Mr Lamb today wrote to Mr Lansley urging him to reconsider, and said the Audit Commission's findings were proof that parties need to work together.

"This report is further evidence of a system in crisis. Temporary measures which only address part of the problem won't do anything to alter the fact that we need to fundamentally rethink how we pay for social care. This won't be possible unless everyone can start to work together in a constructive and transparent way."