Type: Economics
Pages: 7 | Words: 2033
Reading Time: 9 Minutes

One of the main functions of every government and society as a whole is to take care of its individuals and provide them with all the necessary facilities and conditions. Social environment is also one of the essential aspects that our government should think of. Social care is an example of important support that every individual requires throughout life. Social care is an important aspect not only for older individuals, but also for people with certain disabilities or serious and long-term conditions that have a negative impact on their lives. Amount and quality of social care delivered greatly depends on the nature of modern society and government funding. Social care is certainly a crucial human need and it should be effectively provided at any terms in order to provide society and its members with high-quality standards and life conditions.

Social policy is one of the most important parts of society and there is no doubt that problems associated with the upgrade and improve quality of life, and the maintenance of economic stability, the implementation of the principles of social justice, are essential for a modern national economy. Improvement in the area of social and economic relations and improving the quality of human development opens up new prospects for economic development and is a key driver of economic growth. However, the strengthening of social services, improving health and the reduction of social inequalities require stable economic growth, improving the economy as a material change in the financial basis of the social sphere (Adshead, Beresford & Croft 2006). Social insurance and social assistance should act on different principles and use different mechanisms.

The existence of a single budget leads to the fact that in some cases the principles and mechanisms of social insurance are automatically applied in the field of social assistance. Thus, funds for social assistance have to cover the same types of benefits which are appointed and paid by the social insurance system (Walsh, Stephens & Moore 2000). But the question of the rationality and the efficiency of these types of benefits in the system of social assistance is the criteria for determining their size and degree of targeting. Funding for social services is provided mainly by the state and municipal authorities. Social spending is the most important component of the cost of budgets of all the levels.

The absence of a separate budget social assistance system prevents a set of factors such as determining the amount of the reasonable needs of the necessary financial resources; selection of individuals who really need financial assistance, creating and maintaining the appropriate register; rationalization of benefits and compensation, form and timing of supply; and transparent and effective administration of the whole process of providing financial assistance.

Budget indecisiveness social assistance system has a very negative impact on the amount and stability of its funding from the state. During the last five years the volume of annual funding fluctuated significantly, and these fluctuations cannot be explained only by the instability of the overall socio-economic situation in the country. It is also important that the share of public expenditure on social assistance to the population has significantly changed.

Local councils control the way social care is delivered nowadays and they also fund a large number of social care sectors. However, because of the special nature of social services, private sector is often not interested in financing social services within the public sector. Therefore, the growth of the social sphere is greatly dependent on the increase in budget funding, which in turn depends on the revenue base budget (Walsh, Stephens & Moore 2000). Funding for extensive expansion of social services may not be accompanied by the unlimited growth of social transfers. Citizens and businesses are not interested in the increase of the tax burden. There is a limit of growth of tax revenues, after which a dissuasive effect and stagnation in the economy come. In modern conditions, social populism has become a serious factor of pressure on legislative and executive power, which has to take a number of social laws and regulations without real financial security.

In recent years there has been a significant decrease in tax revenues due to the economic recession (Walsh, Stephens & Moore 2000). This period is characterized with the privatization of enterprises that provide some services, previously belonging to the public sector, for example, the services of consumer services, and some services of cultural, sports, etc., and a number of other services, such as public utilities that were also reformed. However, further reduction of government social spending was followed by the commercialization of many social and cultural services, encountering limited purchasing power of the majority.

Minimizing the social sphere by reducing revenue of reproduction is a violation of the human factor. In the current socio-economic context, the dominant source of funding for social care services is direct government funding, based on capitation. It provides extensive financial and economic independence of institutions and organizations of the public sector.

In order to increase the validity of normative financing social sectors, it is important to develop minimum social standards underlying the development of minimum standards of budget funding, the federal funding component of social norm and therefore the minimum required budget at the different levels of government. Such an approach can provide a single financial space and put reasonable mechanism for horizontal and vertical alignment of the regional. This is important for a balanced social and a transfer policy.

It is possible to state that a single-channel funding system of operational control is currently at the level of institutions and organizations of social transformation in multi-channel financing on the principles of non-profit management (Walsh, Stephens & Moore 2000). Budget financing of social sectors is not replaced and supplemented by extra budgetary funding. In addition, direct government funding is combined with an indirect mechanism through tax incentives as government agencies and entities of extra-budgetary funds.

Funding in some areas of social sector (health, pension, etc.) in recent years has been built on the basis of insurance that connects the size of payments and the total labor input. Since the system of motivation in insurance financing methods based on the principle of distributive in some social sectors was not effective enough, the need to enhance them to make the transition to the mandatory cumulative accumulation of funds. Improvement of the efficiency of budget funding model promotes the use of personalized finance social needs of the population. This model contains two versions, based on different principles of social services.

The first one is the universal principle of social services to all members of society, or all members of a particular category of the population. It deals with the provision of social services to consumers through various social mechanism certificates such as insurance, personal educational loans, etc. In such a way consumer financing through the mechanism of social evidence adds a competitive factor in the system of financing social services. Only in this case it is possible to create the conditions for the direct beneficiaries of specific targeted funding of social services. This allows overcome the growing recent trend of excessive bureaucratization of social infrastructure.

The second principle is related to targeting of social services to consumers with the differentiation of the population by the level of need. This may include the introduction of single means-tested benefits. Compared with government funding it provides social services that are not driven by nature to return and paid character. Moreover, targeted funding through specific evidence makes it possible to identify the public sector in some segments of the social sphere.

This kind of co-financing of social services meets the requirements of social justice. It eliminates the possibility of free or concessional terms of social services of high-and medium-income segments of the population. It is necessary to acquire social services at market prices, paying them at the expense of the family budget. In terms of financing social expenditures targeted social assistance is seen as the most effective method of social policy and as social transfers of the load from the state and municipal budgets to the family.

A promising way to increase the efficiency of budget financing of social services was found recently and it is funded through government contracts, state programs, funds, grants and contracts, which are placed on a competitive basis as between the public non-profit and non-profit organizations. But the method of budget financing of social services is not an alternative normative base budget funding. Having some advantages, (flexible and dynamic, and targeted to receive funding), there are still certain drawbacks and particularly instability in the financial income. This limits the widespread use of this method of financing. Therefore it is advisable to base budget funding to supplement funding through contracts, grants and foundations.

The state creates a system of social control and monitoring. In this case, not only educational and medical institutions are controlled, but also state health potential. Moreover, it is accompanied with the educational potential losses to society from their inconsistency needs, and risk factors.

Unfortunately, in these years, the actual content of greater spending on benefits and compensation also tended to decrease. In these circumstances, they are not able to fully perform the role of social shock absorbers. However, the problem is not in a lack of budget, but in the rationality of its use. Social care is regulated by a number of laws, government regulations and by-laws, from time to time amended and supplemented. Their complete and simultaneous implementation can be assured of the financial resources provided by the state. This is one reason that the planning costs of providing social assistance is not based on clearly justified need and the categorical social programs.

Project aims

This study will seek to achieve the following objectives:

  1. Produce a detailed in-depth report which applies academic conventions.
  2. Determine the affect of government budget cut on social care through an introduction of the research and a literature review.
  3. Design the research programme in a form of open questionnaires and above alone with an unstructured interview.

Both quantitative and qualitative approaches were used for this study. The use of quantitative research methodology was meant for the purposes of getting real statistics and facts regarding the affect of government budget cut on social care.

Dissertation Structure

This paper will fix attention on the notion of adult social care services and the affect of budget cut on them. The study contains seven main sections. The first section has provided the background information to the study and the study’s objectives. The second section serves as an overview of the work and its organization. The next section contains the overall literature review. What is more, the paper highlights the objectives and questions the research sought to answer. This is possible due to the analysis of the available research data provided in the literature review section. The objectives are logically connected with the literature review and form the basis for the next section of the paper. All the aims of the study are achieved with the help of the critical review of the available literature on this topic and an analysis of the social care system in the country. The methodology section outlines how the data collected may help answer the questions derived from the objectives. This includes a review of the qualitative and quantitative data collection methods as well as ways of handling the data for getting desired results. The next section reports results of the exploratory data analysis. This chapter contains several important parts that depict the process and results of the conducted empirical research. The methodology section outlines how the data collected may help answer the questions derived from the objectives. Moreover, all the limitations present in the study are also mentioned and defined in this paper. This data is presented in accordance with an evaluation of the given results segmented into corresponding topic areas. All the findings and conclusions help to indicate the implications of research results that were justified by particular research methods and literature review. The last section summaries the findings, draws conclusions from them and indicates some of the implications of research results. The paper concludes by justifying the research methods and literature review, and by stating an argument derived from the analysis of the data. Limitation of the study and suggestions for further research in this field are considered.

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