"The NHS will last as long as there are folk left with the faith to fight for it"
Aneurin Bevan

Friday, 15 January 2010

Conservative Draft Manifesto 2010: Dissection Part 14

An analysis of the Conservative Draft Manifesto 2010.

"we will allow everyone – on retirement – to protect their homes from being sold to fund residential care costs by paying a one-off insurance premium of £8,000."

Many people have pointed out that this policy has problems. The average annual fee for residential care homes is £18,000, where constant medical care is needed, then the care required is from a nursing home and the average cost is £25,500 a year. There are regional variations, of course, and in the last few years fees have exceeded the rate of inflation. A one-off payment of £8,000 looks like remarkable value-for-money. 

But that is the problem. It means that most people who pay this insurance fee must not go into residential care for there to be enough money to pay for those that do. Those that do not go into residential care will stay in their own home and will need care there. This scheme can only work if it includes provision for care in the home of the elderly. The Conservatives make no mention at all about care of the elderly in their own home. So we can only assume that the Conservatives expect that the elderly will have to pay for their own care. 

Update (18/2/2010): Even Andrew Lansley does not believe that £8,000 is enough:

The Liberal Democrat health spokesman, Norman Lamb, said that his Tory counterpart, Andrew Lansley, had accepted before going on a BBC political show this Sunday that Conservative plans would see people offered three voluntary insurance schemes.

One, which the Tories have already outlined, costing £8,000, would be for those who wish to be covered in the event they had to go into a care home. The second, said Lamb, was a new admission: a one-off payment of £10,000 to secure care for people in their own home. The third was a "cheaper, stripped down package for critical care at home". "Having options within a voluntary scheme has potential perverse consequences. What happens if you want to switch out from one scheme to another?" said Lamb.

There is abundant evidence that under the Conservatives the vulnerable will be forced to pay extra. The so-called Conservative Easy Councils, local authorities that have made savage cuts in council tax, have done so by increasing charges for services including social care. In effect, these councils have targeted the most vulnerable in our society to pay for the council tax that benefits the rich. So if the choice is for an elderly person to have to pay themselves for help in their own home or to get free residential care, they will have no choice at all: they will choose the latter. This is the fear of the Association of Directors of Adult Social Services and the Kings Fund who say that this policy from the Conservatives will mean that people will go into residential care too early.

There is also a philosophical issue. When I asked an elderly neighbour about care for the elderly she told me that she was brought up to save for her retirement, and so it was a natural assumption that any assets that she had – including her house – would go towards paying for her care if she needed it. In fact she, and those people of her generation, was very forthright about the issue: she did not want her children to be paying for her care, and her house was hers and so ultimately she know that this would pay for her care. But, she told me, if she didn't need care then she was happy for her children to inherit her house. This is the sort of self-reliance that should be encouraged.

The Conservatives, however, seem somewhat obsessed with the idea of inherited wealth. This has been clear time and time again when they argue somewhat unjustifiably for an increase in the IHT (Inheritance Tax) threshold. The Conservative obsession infantilises the adult children of the elderly, suggesting that they are not capable of living their own lives without the inherited wealth of their parents. This is nonsense, of course, but it is the only conclusion that can be drawn from the Conservatives obsession with enabling children to inherit as much as possible from their parents. The Conservative social care policy is more evidence of this Conservative obsession over inheritance because the justification is "to protect their homes from being sold to fund residential care costs". The whole point of a policy on social care should be to ensure that the elderly retain their dignity and receive the care they need; inheritance should have nothing to do with the policy.


  1. Doesn't this all kind of miss the point of the fact that it is unfair that those who are irresponsible and do not save to support themselves in old age get the care FREE while those who play by the rules lose their home? Are you saying we should all just spend as we earn then and wait for the government to pick up the tab when we can no longer care for ourselves?

    Somehow I think that may cost a little more...

  2. First, not everyone have sufficient income to save the sorts of figures needed. The Audit Commission says that the the average weekly cost of social care is £980. The insurance companies will not touch the Conservative one-off £8,000 idea because it is completely underfunded. In fact, if you look at the government's green paper you'll see that they presented five options one of which was a one-off insurance payment at retirement. That was £20,000, and that was worked out as being 2/3 of the average cost of social care.

    But I should take you back to what you said. People who have a house have invested in that asset. Why not use that asset when they really need it - for the care that they need at the end of their lives? One of the green paper's suggestions was that the £20,000 contribution would be paid after death as long as there is no surviving spouse.

    Please read my 18 Feb post about this where I explain the green paper options in more detail.

  3. It's not as simple as people working harder and saving more money than others. What about NHS nurses? or teachers? They work bloody hard, and they are vital, but they don't earn as much as a banker. It is harder for them to save and buy a house. So why should they have a harder time at the end of their lives because of that?