<p>This paper reports the interim findings of a study of social services for older people in England. The aim of the study is to produce options for an improved and updated formula for the formula spending share (FSS) which is used to allocate central government funding to councils with social service responsibilities (CSSRs), concentrating on the needs component. We do not present here principles or details of the approaches used, which will be provided in the final report, but focus on the calculation of the formulae.\ud \ud <p><p><p>The approach to determining the needs component for the FSS formula involves the prediction of demand for social services on the basis of an estimate of the number of people living in a CSSR area who might be expected to need services under a standard level of service. The development of services in recent years indicated that up-to-date information was needed, and since sources of secondary data such as the General Household Survey (GHS) are incomplete, new data collections were required. Two approaches were adopted. First, individual level analyses required information about older people in receipt and not in receipt of services. Second, small area analyses required information about service receipt by individuals in specific areas (usually wards) with known characteristics.\ud \u
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