Andrew Dilnot’s anticipated report into the funding of social care in England proposes some fundamental changes to the way long term care should be funded.
There is a pressing need for the government to change the way long term care is funded across England. Age UK has estimated that fewer than 1.2 million of the 2.9 million older people in England who have care needs receive any help from their council, leading to the much publicised issue of people having to sell their home to fund their own care costs. The twin pressures of cuts in council social care budgets and an ageing population mean that, without urgent amendment, the current system will become even more inadequate.
The Dilnot Commission seeks to address this by proposing:
- The introduction of a means tested care cap of £35,000. Anyone with care costs over the cap would have these costs met by the state.
- A cap on ‘hotel costs’. The proposed £35,000 cap only applies to the care people receive and not to living costs, such as the cost of food and accommodation for example. The commission argues that the cost of these charges should be capped at between £7,000 and £10,000 a year to stop care homes raising fees excessively
- The means test threshold should be raised to £100,000. At the moment people have to pay for their own care if they have assets – including a home – worth more than £23,250. Dilnot says this figure should be raised to £100,000
- National eligibility criteria and portable assessments should be introduced to ensure greater consistency
Dilnot’s report says that under his plans for a new cap on costs and a higher means-testing threshold "no one going into care would have to spend more than 30% of their assets on their care costs". Under the current system people face losing up to 90% of their assets.
Interestingly the Commission also proposes that anyone who enters adulthood with a care and support need – for example a severe disability – should be eligible to free state support without being subject to a means test.
Other proposals put forward by the Commission include: the continuation of universal disability benefits but a rebrand of Attendance Allowance; improved assessments to ensure that the impact on carers is manageable and sustainable; extending the deferred payment offer to make it available to all, wherever they live; reviewing the scope for improving integration of adult social care with other care and support services; and a national awareness campaign to help people understand the system and plan ahead to cover the cost of their future care needs.
The main and long trailed proposal within the Dilnot Commission’s report is to introduce a cap on care costs. The Commission says that “individuals’ lifetime contributions towards their social care costs – which are currently potentially unlimited – should be capped. After the cap is reached, individuals would be eligible for full state support. This cap should be between £25,000 and £50,000. We consider that £35,000 is the most appropriate and fair figure.”
The idea behind this cap is three-fold:
- Firstly it will finally allow a private insurance market in care to germinate as insurers will have visibility about the total liability they will have to insure people against
- Secondly it provides a clear and set cost for individuals about what they will be expected to pay and what the state will pay for their care
- Thirdly it will stop the current problem of people facing large bills running into the hundreds of thousands of pounds for their care and having to sell their home to fund care. Currently a third of people end up with bills of £20,000 and one in ten with bills of more than £100,000
The cost is the most politically charged area of the debate. The Commission estimates the costs of its proposals to be approximately £1.7billion a year from 2014, though these are likely to rise as the population ages and could double within a decade. The Treasury is understandably nervous of any increased expenditure on this level, given the Government’s pledge to drastically cut the deficit over the course of this Parliament.
Dilnot may be right when he argues that £1.7billion a year represents a fraction of one percent of overall public spending. Although given that the costs will have to be met by either cuts to spending in the 2013 Comprehensive Spending Review or an increase in taxes, which have been estimated to be £200 a household, making the case for the proposals is not an easy political sell in the current cash-strapped environment.
The Dilnot Commission was established by the Government last year to take the heat out of what had been a politically divisive election issue between the now coalition partners.
Last week saw a surge of stakeholder activity from those looking for a change in the system, including charities, patient groups and activists and all are likely to be seeking ways to keep the commission and its’ proposals in the political spotlight. Indeed Age UK has already called for a white paper on the issue to be published by next spring at the latest.
However the signs are that the politicians may be looking to buy yet more time. Liberal Democrat Health Minister Paul Burstow used an appearance at the King’s Fund last week to try to dampen down expectations of the implementation of Dilnot’s proposals. The Health Secretary, Andrew Lansley, for his part, has said of accusations that he will kick Dilnot into the long grass: “We wouldn’t have asked Mr Dilnot and his colleagues to start this work if we were going to do that.” However this is hardly a call to arms for the implementation of Dilnot’s proposals.
Within Government there are likely to be difficulties given the challenges secretaries of state across Whitehall have had in negotiating sharp reductions in their departmental budgets. Think Ken Clarke at Justice and the fallout over proposed cuts to prison sentencing or Caroline Spelman at Environment and the ensuing plans to privatise areas of Britain’s forests. Any increase in expenditure on such a level is likely to cause tension and friction within Government and between ministers.
For the Opposition, the opportunity to score immediate political points from any proposals has been neutered by the Leader of the Opposition’s pledge to work with the Government to find a constructive, cross-party solution. However do not expect a cosy short-term consensus. The Opposition is likely to accuse the Government of dithering if it shows any signs that it will, as one Downing Street source is quoted as saying in today’s papers ”kick the findings into the medium term grass.” There is also the argument coming from some corners within Government that they are busy enough with health, education, welfare and police reform without having to address another complex, costly and controversial issue.
As for the Prime Minister, while he will publically welcome the review today he is likely to call for a period of reflection to study its proposals and their implications – leaving a period of uncertainty for campaigners over the possible implementation/rejection of the recommendations.
With the Government unlikely to commit to the proposals immediately, it is expected that a series of timetables will be set out to build on the work of the Commission. Ministers will say that they want to go through the report in detail before they formally respond to the review: a very different approach from the Government’s response to the report by the NHS Future Forum on the proposed changes to the health and social care system which was published within days.
This response could take till the end of the year. Interestingly a white paper on social care is expected either late this year or early next which will include proposals on implementing the Law Commission’s findings on social care law, any fallout from Southern Cross’s financial troubles and inquiries into alleged abuse at Winterbourne View.
The Government may well look to then come up with a series of its own proposals on the back of the Dilnot Commission which it will then publish by this time next year.
All of the above means that any new system is unlikely to be in place before the next election. And as Labour found when trying to bring forward proposals to change the funding of the care system, the time before an election is hardly the best time to build a consensus on funding long term care funding.
This could thus turn out to be known as the ‘Do not’ review.