News

In June last year the Government published their long-awaited Green Paper on Social Care, Shaping the Future of Care Together.  The Green Paper set out three potential options for the longer-term funding of social care, none of which are costed, but the Government has not reached a decision on the best model.  The three options are:

1. ‘Partnership’.  Under this option there is no compulsory or voluntary insurance payment.  People are entitled to a certain proportion of their care for free and then have to pay for the rest dependent on their means (e.g. through selling their homes).  This is similar to the current system, except that everyone would be entitled to an initial proportion of their care for free.   
2. ‘Insurance’.  This option has exactly the same features as the ‘partnership’ model except that people would also have the option of paying into a voluntary insurance scheme to cover any further costs they might incur after receiving their basic portion of care for free.  
3. ‘Comprehensive’.  Under this option: ‘‘Everyone over retirement age who had the resources to do so would be required to pay into a state insurance scheme. Everyone who was able to pay would pay their contribution, and then everyone whose needs meant that they qualified for care and support from the state would get all of their basic care and support for free when they needed it… As an indication of the costs, people might need to pay around £17,000 to £20,000 to be protected under a scheme of this sort compared with the average cost of care for a 65-year-old which is £30,000.

• 30 September 2009 – Free Personal Care at Home Pledge.  The Government has not provided any further details on the National Care Service beyond the sketchy outline in the Green Paper.  But, at the Labour Party Conference on 30 September and in the 2009 Queen’s speech, Gordon Brown made a pledge on free personal home care which he said was the ‘first step’ towards a National Care Service.  In the Queen’s speech, Gordon Brown promised to give 280,000 people with the highest needs free personal home care, which he claimed would cost £670 million per year.

• On Tuesday 9 February, The Guardian reported that the Government’s favoured option from its Social Care Green Paper was the ‘comprehensive’ scheme involving a death tax of up to £20,000.  It claimed: ‘Radical proposals for a £20,000 compulsory inheritance levy to help pay for Gordon Brown's social care plans may be endorsed by the government before the general election.

• When challenged by David Cameron, Gordon Brown refused to rule out the option in the Green Paper of a death tax of up to £20,000 saying that the Green Paper ‘put forward all the various options before us’.   Andy Burnham also indicated on Channel 4 News on the same day that a death tax was his preferred option.  He cited the disadvantages of the first two options, including that they could ‘end up costing more’ and went on to conclude: ‘I’m not shying away from saying, yes, a compulsory scheme where everybody contributes and where everybody gets care for free is one of those options.  And yes, it’s difficult, but yes, I am looking seriously at that option’. Then on Friday 12 February, the Government conducted telephone polling to find out what people think of their ‘death tax’ option (The Observer, 14 February 2010). 
• 19 February 2010 – Andy Burnham holds care conference.  On Friday 19 February, the Department of Health held a conference to debate plans for social care.  However, it was hastily arranged and with political conditions attached to attendance (that Conservatives could only attend if we stopped campaigning on the issue).  Shadow Health Secretary, Andrew Lansley, refused to attend because the conference was a political stunt and the Government refused to rule out the death tax option. 

NATIONAL CARE SERVICE

• Regardless of whether Gordon Brown decides to go for the Death Tax or not, all the options for his plans for a National Care Service will still mean cuts to cash disability benefits AND cuts to the NHS budget AND new taxes.  It’s time he came clean about how taxpayers will pay for his plans for a National Care Service 
A National Care Service will mean a £20,000 death tax...
• Andy Burnham admits Government ‘is considering’ a £20,000 death tax; reports suggest it is Labour’s favoured option. 
• AND... cuts to cash disability benefits - All options would mean cuts to disability benefits – and these are on top of the death tax in the third option. 
• AND... a £180 yearly tax rise for every family or a £3.8 billion cut to the NHS budget - Further net cost to the taxpayer of up to £3.8 billion.  
• AND... even higher unfunded costs to the taxpayer - The Government has admitted it has left out some costs and in Scotland costs have soared
• It will hit carers hard and leave a further black hole in spending plans.  There are about 700,000 people in England spending more than 50 hours a week looking after an elderly relative (Carers UK, Facts about carers, June 2009).  Despite looking after their loved ones themselves, these families would have no choice but to pay Labour’s £20,000 death tax. In future they would also lose their ability to claim disability benefits – worth up to £70 per week. 

The Conservative’s Approach

We will make sure that people will no longer be forced to sell their homes to pay for their long-term care.  In England, all the costs of residential care must be met by the individual if they own just £23,000 or more in assets – including the value of their homes. Most pensioners have only modest savings, so practically anyone who has worked hard all their lives to pay for a home of their own is at risk if they need to enter care. There are very few insurance products currently on the market that cover people for entering care homes, and these are typically far too expensive for most people.  A Conservative Government will:

Introduce a new, voluntary scheme with a one-off joining fee that we estimate will be around £8,000, paid at the age of 65, in return for a guarantee that all fees for permanent residential care would be waived – for life.
This is excellent value: the average amount in fees someone has to pay for entering residential care is over £50,000, but can be far more if they need to stay for several years.
Existing insurers could help run the scheme, using branded products, with the Government setting out some basic rules and safeguards to ensure the scheme remains both fair and financially viable over the long term. No public money will be needed. 
As well as allowing people to join the scheme as they reach 65, we will open the scheme to existing over-65s for a fixed ‘window’ of time so everyone has the opportunity to benefit.
We are also looking at innovative ways to help people stay in their own homes for longer, such as Telecare, reablement, better home adaptations and community support programmes.

We support the idea of a national care service, but it must be consistent with the following principles and must not involve abolishing disability benefits. 

1. A Personalised Not Nationalised Service.  State provision can often be inflexible whereas personal budgets and direct payments enable people to purchase the care that best meets their needs.  As far as possible, we want care to be delivered in this way, because it empowers people and gives them real choice.  It is also a more efficient way to deliver services.  Talk to anyone who has care provided through their Local Authority and very often you hear they find the amount actually paid to their carers looking after them only represents about half of the cost of the total care service (Local Government Association).

2. Better Support for Care at Home.  We need to help people to stay in their own homes for as long as they can.  We have promised to spend a greater share of the NHS budget on public health.  Local Directors of Public Health will be able to spend some of this money on improving support for people in their homes. We are looking at innovative ways to do this, such as telecare, better home adaptations and community support programmes.

3. Consistent National Standards for Assessments of Care Needs.  At the moment there is huge variation in the care packages available in different local authority areas.  We will make sure there is a single assessment for care, which is consistent across the country, based on national standards, and which is consistent, should you move to a different area.

4. Protection - people no longer forced to sell their homes to pay for care.  As described above, we will make sure that people will no longer be forced to sell their homes to pay for their long-term care.