Councils are projected to fund more than half (52%) of increased labour costs passed on by providers from the fair pay agreement for social care, Government analysis has found.
An impact assessment carried out by the Department of Health and Social Care found the NHS would cover 17% of the increased labour costs, with self-funders paying for almost a third (31%).
The assessment forecasted a 2.8% wage increase in 2028-29 would be possible given the £500m made available for additional local authority expenditure, which, on top of the increase in the National Living Wage (NLW), would mean a pay uplift of 5.1% between 2027-28 and 2028-29.
It said that on the basis of current funding an adult social care negotiating body could introduce a pay floor 68p above the expected NLW in 2028-29.
