Interim National Care Service Advisory Board: Advice to Scottish Ministers - Fair Work

Risks/challenges associated with the interim Board’s advice

Risk/challenge: There are clear expectations that sectoral bargaining will deliver more than the real living wage (providers seeking parity with what they assess as equivalent roles within Agenda for Change pay structures) and will extend beyond pay to wider terms and conditions. At a time of significant financial challenge, meeting these expectations will require considerable additional budget.

Response/mitigation: The interim Board recognises the considerable financial implications of its advice, but believes there is a moral and legal imperative to ensure that people have access to the support they need. Without taking critical action now to support the recruitment, retention and wellbeing of the social care workforce, those duties cannot be met. Failure to make the necessary investment now will only compound workforce challenges and increase pressures on the system. Unmet pressures in social care lead to pressures across the wider system – including through delayed discharge, unplanned hospital attendance, which result in disproportionately higher costs across the totality of the health and social care system. There is therefore a sound, fiscal argument for taking this action now, to prevent further escalation of costs later.

Risk/challenge: The Care Reform (Scotland) Act 2025 requires Scottish Ministers to publish a Fair Work Strategy by summer 2027, following wide ranging consultation with specified groups. While involving the Advisory Board would contribute to consultation requirements, membership would not cover all groups – with trades unions a critical omission.

Response/mitigation: The interim Board recognises the importance of involving a wide range of interests in the development of the Strategy, as in all of its remit. The Advisory Board would provide access to the views of service users in a way that current groups such as the Fair Work in Social Care Implementation Group does not. Work to date by the interim Board has drawn on a range of interests extending beyond core membership – including the Fair Work Priority Group, to which trades unions have been invited. Work on the Strategy could follow a similar approach – wherein the Advisory Board’s developing approach to wider participation could ensure that relevant interests were able to contribute.

Risk/challenge: There is a clear challenge to securing pre-budget agreement to a process (and associated outcome) which would allow for conclusion of a pay, terms and conditions settlement which would commit budget of many tens of millions of pounds (2025/26 pay uplift cost £160m).

Response/mitigation: The interim Board recognises that securing funding in time for pay uplifts and funding for improved terms and conditions in time for introduction in April each year, with no need to backdate, is a change from traditional negotiating arrangements and creates challenges in terms of parliamentary governance around the annual Budget Bill. The interim Board notes, however, there is precedent for this in relation to payment of the Real Living Wage uplift. This is already part of the existing budget arrangement whereby payment of the RLW is facilitated for April uplift. Sectoral Bargaining could follow a similar arrangement, albeit, costs would likely be higher.

Risk/challenge: If the 2026/27 Annual Budget Bill is not passed by Parliament the baseline for sectoral bargaining will have been re-drawn, and it will not be possible to secure buy in from key sectoral players.

Response/mitigation: The interim Board recognises the importance of meeting the Real Living Wage uplift costs so that the good work on sectoral bargaining does not go to waste.