Guidance

Grant circular

Updated 26 January 2023

Applies to England

This circular sets out:

• allocations of the Workforce Recruitment and Retention Fund, round 2, for 2021 to 2022
• the conditions that will apply to that grant
• guidance intended to assist local authorities

Background

On 14 September 2021 the government made a commitment in the COVID-19 response: Autumn and Winter Plan 2021 to support local authorities and social care providers to maintain safe staffing levels over the winter period and to continue working with the care sector to ensure there is sufficient workforce capacity across services.

The adult social care winter plan published on 3 November 2021 sets out the support the government will be providing to the adult social care sector to meet the challenges it faces this winter. The plan included a commitment to providing a Workforce Recruitment and Retention fund, round 2, to support local authorities and providers to recruit and retain sufficient staff over winter, and support growth in workforce capacity of the existing workforce.

The main purpose of the Workforce Recruitment and Retention Fund, round 2, is to urgently support local authorities address workforce capacity pressures in their geographical area this winter through recruitment and retention activity. The core aims of this fund are to:

• support timely and safe discharge from hospital to where ongoing care and support is needed
• support providers to maintain the provision of safe care and bolster capacity within providers to deliver more hours of care
• support providers to prevent admission to hospital
• enable timely new care provision in the community
• support and boost the retention of staff within social care

This workforce recruitment and retention funding will be paid out to local authorities as a standalone section 31 grant with conditions on its use. Allocations for this portion of the grant will be made using the Relative Needs Formula (RNF).

This is a new grant, separate to the extension to the Infection Control Fund and Rapid Testing Fund, which will further help the care sector respond to the challenges posed by COVID-19 and will be paid to local authorities in England.

This document is accompanied by 5 annexes (and accompanying guidance) which among other things set out the conditions upon which the grant is paid and the local authorities to whom it will be paid:

• annex A – grant determination letter, round 2
• annex B – grant conditions, round 2
• annex C – grant allocations, round 2
• annex D: reporting point 1, statement of assurance, round 2
• annex E – post fund statement of assurance, round 2

The grant

The 2020 to 2021 grant will be paid in 2 instalments:

• payment 1 – £210 million (70% of funding) by January 2022
• payment 2 – £90 million (30% of funding) in February 2022. This payment will be conditional on local authorities having completed a return to the Department of Health and Social Care by 21 January 2022

This grant covers the period from 10 December 2021 to 31 March 2022.

Grant conditions

Pursuant to section 31(4) of the Local Government Act 2003 the Secretary of State has attached conditions to the payment of the grant, which are set out in annex B (grant conditions).

All funding must only be used to deliver measures that address local workforce capacity pressures in adult social care between 10 December 2021 and 31 March 2022 through recruitment and retention activity. We expect local authorities to work closely with adult social care providers to determine how funding should best be spent, including passporting funding directly to adult social care providers where appropriate. It will be important to retain existing staff capacity as well as encourage new and returning entrants.

Where adult social care workforce capacity pressures are a significant contributor to delayed hospital discharge, local authorities may want to engage with clinical commissioning groups (CCGs) and NHS trusts to collaboratively support and enhance the impacts of measures from this fund.

Examples of this include, but are not limited to:

• activities to support hospital discharge or to prevent or address delays as a result of workforce capacity shortages (distinct from Enhanced Guidance on finance and contracting arrangements for H2 2021/22 Discharge funding agreed in H2 2021 to 2022 settlement)
• enhancing and bolstering measures already undertaken through the Workforce Recruitment and Retention Fund, round 1
• supporting payments to boost the hours provided by the existing workforce – including childcare costs, overtime payments
• (unlike the Workforce Recruitment and Retention Fund, round 1, the Workforce Recruitment and Retention Fund, round 2, can be used for bringing forward planned uplifts relating to pay in advance of the new financial year. However, it should be noted, that the fund is time limited between 10 December 2021 and 31 March 2022 and any ongoing burden would be incurred at risk)
• investment in measures to support staff and boost retention of staff within social care – including occupational health, wellbeing measures, incentive and retention payments. The timing of any incentive payment would aim to encourage workforce retention over periods of high pressure
• the creation and maintenance of measures to secure additional or redeployed capacity from current care workers – for example staff banks and redeploying local authority staff in line with national staff movement guidance, emergency support measures and overtime payments
• local recruitment initiatives
• activities which support the recruitment of local authority employed social care staff, or which enhance or retain the capacity of existing local authority employed social care staff
• local authorities and, where funding has been passported, providers may also use the grant to cover reasonable administrative and set up costs they incur for new measures that deliver additional staffing capacity through recruitment and retention activity

Further examples can be found in the grant guidance.

Where local authorities and, where funding has been passported, providers are already using such approaches, the funding can be used to increase the scale of activity, including that undertaken as part of the Workforce Recruitment and Retention Fund, round 1.

We expect local authorities to work closely with providers to determine how funding should best be spent, including passporting funding directly to providers where appropriate.

Local authorities are encouraged to look at other local authorities’ strategies and where appropriate replicate their approaches to successfully retain existing capacity or deliver additional staffing capacity through recruitment and retention activity (see guidance for Workforce Recruitment and Retention Fund, round 2). Where local authorities are already using such approaches, the funding can be used to increase the scale of activity. Local authorities may also use the grant to cover administrative and set up costs they incur for new measures that deliver additional staffing capacity through recruitment and retention activity.

The grant may be used to fund alternative approaches not specified above on the condition that such measures retain existing capacity or generate additional adult social care workforce capacity through recruitment and retention activity, such as employing more people, where shortages arise due to winter pressures in adult social care.

Any funding should be spent only on time-limited activity during the 10 December 2021 to 31 March 2022 period.

Subject to the grant conditions being satisfied, local authorities can choose to pass some or all of their funding to care providers within the local authority’s geographical area to meet pressure on staff capacity due to winter pressures. If the local authority chooses to make payments to providers financed by this grant they must ensure that providers will use the funding to support genuinely new expenditure that delivers additional staffing capacity or retains existing capacity through recruitment and retention activity and has not already been funded by other sources of public funding.

Clawback provisions apply to this fund including that local authorities must repay any underspend from the fund and any amounts used for measures that do not meet the grant conditions. If the Department of Health and Social Care (the department) considers that funding has not been used in accordance with the grant conditions, it will provide local authorities with an opportunity to explain their spending. However, if the department reasonably believes spending is not in line with the grant conditions the department may recover grant monies from local authorities. All local authorities will be allocated the first instalment of this funding in January 2022, according to the distributions set out in annex C (grant allocations).

The payment of the second instalment of the grant is contingent on local authorities having returned the first return to the department (21 January 2022).

Distribution of funding

Allocations of funding per local authority are attached at annex C (grant allocations).

The department's expectation is that the grant will be fully spent on the staffing capacity measures by 31 March 2022. We are clear that 'spent' means that expenditure has been incurred between 10 December 2021 and 31 March 2022. This means the activity leading to the expense must have happened by 31 March 2022, so that the local authority is accruing the expense and it appears in the local authority's 2021 to 2022 accounts.

If there is any underspend at reporting point 2 (see paragraph below) or the department has insufficient information or evidence to demonstrate that the fund will be spent (reporting point 1) or has been spent (reporting point 2) according to the grant conditions outlined in the grant determination, the Secretary of State may reduce, suspend or withhold grant payments or require the repayment of the whole or any part of the grant monies paid, as may be determined by the Secretary of State and notified in writing to the authority. However, the department will only look to recover funding where it is reasonably considered that the fund has not been used in accordance with the grant conditions.

Reporting

Local authorities must distribute the money in line with this document and are required to provide the department with returns covering the information set out in annex D and the accompanying guidance and return it by the dates below. If local authorities have passed funding on to providers, they must obtain the information they need from providers to complete the returns.

• Reporting point 1: 21 January 2022, a statement of assurance certifying that their reported expenditure from this grant will be spent in compliance with the grant conditions
• Reporting point 2: 29 April 2022, covering expenditure for the entire grant period from 16 December to 31 March

Enquiries

Enquiries about this circular should be addressed to the Department of Health and Social Care, adult social care workforce team at workforcerecruitmentandretentionfund@dhsc.gov.uk