Almost half a million fewer old and disabled people are receiving care and support from the public purse than would have been the case before the financial crash, according to an expert study.

The research comes as MPs vote on Monday on the coalition’s care bill, which aims to overhaul the care system in England but threatens to tighten still further the rules of eligibility for state support.

Charities and care organisations are calling on ministers to address a “black hole” in social care funding which they say has left the system short of £2.8bn a year that would be necessary to meet people’s needs assessed as “moderate”.

Bridget Warr, chief executive of the United Kingdom Homecare Association, said: “Funding good care which helps people stay in their own home is not only a moral responsibility for any civilised society, but is also cost-efficient as it extends people’s wellbeing, reducing admissions to A&E, and helps people return home from hospital quicker.”

The definitive analysis of the effect of cuts on the care system has been conducted by the Personal Social Services Research Unit, based at the LSE and the University of Kent, for the Care and Support Alliance, a coalition of 75 groups.

The new study shows that since 2007-8, when the global financial crisis began and governments reacted by adopting austerity programmes, the number of older people and those with disabilities or mental healthproblems who receive state-funded care and support in England has slumped by 347,000 or more than a quarter.

Adjusting the figures for population change over the period, the researchers calculate that this is equivalent to a drop of 483,000 on the number who would have received care services had five years of cuts not taken place.

People with mental health problems are shown to have been hit hardest by the cuts. Adjusted figures indicate that the number getting a service has fallen by almost half.

The only group to have escaped any cut in actual numbers receiving care and support is people with a learning disability, though a fall in provision is again shown once the figures are adjusted for population change.

The alliance supports the bill, the first comprehensive overhaul of social care law for 65 years, but says it is increasingly clear that many older and disabled people will see no benefit.

Ministers plan to introduce a national eligibility threshold that will mean services are offered to people judged to have at least “substantial” needs. Almost nine in 10 councils apply a comparable restriction under the existing locally-based system. To set the threshold at “moderate” needs would require an extra £2.8bn, the alliance says.

Warr said: “The care bill gives a real opportunity to address this before it is too late, but it will take some bravery on the part of politicians to take the tough decisions required to re-direct the necessary resources from other budgets.”

Care and support minister Norman Lamb said the national threshold would provide clarity and consistency and would stop councils tightening eligibility even more as some had done in the past. They would still be at liberty to be more generous than the national criterion.

£3.8bn fund for integrated health and social care, planned for 2015-16, would help many people to continue living independently, Lamb said. “This amounts to a major shift of resources to prevention of ill health.”

The Guardian