How Local Authority Funding Works for Home Care Support in the UK

Understanding local authority funding can feel confusing, especially when you’re trying to find the right care for a loved one. Many families don’t realise that local council funding may help cover home care costs such as personal care, respite care, domiciliary care services, and live-in support. Knowing how this system works gives you clarity about what help is available and how decisions are made.

This guide will walk you through the process, from funding for local authorities and financial assessments to how funds are allocated and used. You’ll also learn how local government finance affects home care services and what you can expect when organising care for your loved one.

What Is Local Authority Funding?

Local authority funding refers to money distributed to councils to deliver essential services and care funding in their local areas. This includes adult social care, education, housing, and public health. It forms part of the funding of local government, which is how councils across the UK pay for the support and services people rely on.

Each year, councils receive central government grants, which form part of their core spending power. This is combined with income from council tax and retained business rates. Together, these sources create the financial base of the local government funding system. Councils then use these funds to provide vital services such as home care, community health, and temporary accommodation.

Local councils are legally obliged to deliver support that meets national standards and reflects local need. Over the last decade, there have been significant reforms in how funding is distributed, aiming to create greater focus on equality between urban areas, rural areas, and the most deprived areas.

What Types of Home Care Can Be Funded?

Home care can be a lifeline for people who want to stay independent. If you or your loved one meets the eligibility criteria, local authorities' funding may contribute towards care at home. This support is part of wider public services delivered by councils.

Common types of care that can be supported through local authority funding include:

• Personal care such as washing, dressing, or eating.
• Help with domestic tasks like cleaning, laundry, or meal preparation.
• Assistance with medication routines and physiotherapy exercises outlined by professionals.
• Escorting to medical appointments or social activities.
• Providing respite care when family carers need a break.
• Access to essential services that help people stay comfortable and safe at home.

Councils also fund other services that support wellbeing across communities, such as day centres, transport schemes, and local outreach programmes. These often receive grant funding or additional funding from central government grants or charities. Some councils also use small pots of money to pilot projects that tackle rising demand for care in specific local areas.

How Does the Assessment Process Work?

Accessing local authority funding begins with two main assessments: a care needs assessment and a financial assessment. These determine whether your loved one qualifies for financial support and how much the council will contribute.

1. Care Needs Assessment

The local council will review your loved one’s daily living needs. This looks at how they manage essential tasks like bathing, cooking, and moving around. The goal is to identify what council services are required to support independence and wellbeing.

This assessment also considers emotional and social needs. Councils are legally obliged to ensure fair access to care across all local areas, following national standards and balancing limited resources.

2. Financial Assessment

The financial assessment, also known as a means test, looks at your loved one’s income, savings, pensions, and property. Councils use funding allocations and eligibility thresholds to decide how much help is available. If someone’s savings exceed a certain limit, they may need to self-fund care until their capital drops below the threshold.

Factors considered include:

• Total income (such as pensions).
• Savings and capital.
• Property ownership and property tax.
• Eligibility for household support fund schemes.

Each council has its own rules within the wider funding for local government framework. This ensures fairness across individual councils, though there may still be variation in how funds are used at a regional level.

What Can Local Authority Funding Be Used For?

Once approved, local authority funding can cover a wide range of essential services. These services are designed to make everyday life safer and more comfortable for the person receiving care.

You may use this funding for:

• Assistance with personal care and hygiene.
• Help prepare meals or maintain a clean home.
• Support attending appointments or joining community activities.
• Access to equipment, home adaptations, or temporary accommodation.
• Arranging short-term respite care.

Councils use a mix of public spending and investment from central government grants to keep these services running. However, due to rising demand and additional costs, many local leaders say more funding is urgently needed to meet care needs in full.

Some councils have found creative ways to maintain council services:

• Redirecting underspent budgets to community care projects.
• Working with charities and local services to deliver joint programmes.
• Seeking multi-year funding settlements for long-term stability.
• Improving allocation funding processes to ensure fair support between shire districts and the two tiers of government.

Even with these efforts, many local authorities face pressure to balance public sector costs, especially when supporting people across both rural and urban areas.

Direct Payments and Personal Budgets Explained

When a person qualifies for local authority funding, councils calculate their personal budget, the total amount set aside to meet their care needs. This can be managed in different ways depending on how much control the person or their family wants.

The three main options are:

1. Council-managed budget – the council organises care directly.
2. Direct payments – funds are paid to you so you can choose your preferred care provider.
3. Mixed arrangement – a combination of both methods.

These options give people flexibility while ensuring funds are used according to national standards and local policies. The allocation funding process must comply with the spending review and be consistent with local government finance guidelines.

Over the previous years, councils have adjusted how they handle funding allocations to reflect real-term increases in care costs. However, government policies, significant reforms, and public spending pressures have left many councils with limited resources.

Despite this, local leaders continue to prioritise vital services, aiming to provide fair access to care in both single-tier and two-tier systems of local governance. There is now a greater focus on ensuring equality between communities, especially those in the most deprived areas.

The Role of Local Government Finance and Reform

The local government funding system has evolved through various reforms led by different governments. Over the last decade, councils have worked hard to adapt to funding changes while delivering public services that matter most.

Business rates retention allows councils to keep a portion of their business taxes, encouraging local economic growth. Retained business rates, combined with property tax and council tax, support public services such as education, adult social care, and housing.

At the same time, funding for local authorities has faced pressure from reduced central government grants. Many councils are campaigning for additional funding to meet the needs of ageing populations and rising demand for care.

Local leaders argue that investment in council services and essential services benefits everyone, particularly in rural areas where access to care can be limited. They also call for multi-year funding settlements to give councils stability and help them plan ahead effectively.

Conclusion

Navigating local authority funding can feel daunting, but understanding how it works helps you make informed decisions. Each council uses funding for local government and central government grants to provide vital services that support people in their homes. However, funding rules and eligibility vary, and not everyone will qualify.

While Tiggo Care does not accept Local Authority-funded clients, we work with NHS Continuing Healthcare and self-funding clients. We focus on helping you organise personalised home care that maximises comfort, independence, and peace of mind. Our team supports people with daily routines, meal preparation, and appointments, always guided by professional advice.

If you’re exploring private care or NHS Continuing Healthcare, Tiggo Care can help you find the right support and care at home, ensuring your loved one receives the compassionate care they deserve.