Five months before the Dilnot commission on funding care is due to report, one of its members appears to have jumped the gun. According to national newspaper reports, Lord Warner told a conference on 15 February that compulsory contributions towards the cost of care would not feature in the commission’s recommendations.
Quite what that means remains to be seen. But it would be surprising, at this relatively early stage, if commissioners had already ruled out some major options to fund better care.
It also smacks of déjà vu, bringing back memories of last year’s pre-general election debate on the ‘death tax’. Then the Conservatives said that they supported a voluntary insurance scheme, whereby individuals could pay £8,000 and in return all their residential care costs would be covered. This particular proposal seems to have disappeared quietly but the preference for a voluntary solution remains – despite the fact there is no evidence from anywhere in the world that a voluntary scheme works.
Just as worrying is that the commission has already published its criteria for a new funding regime. Put in a nutshell, it must be fairer, simpler, transparent and sustainable. Again, a voluntary scheme would not meet these criteria – most people won’t take out an insurance plan to pay for care that they think they won’t need. Sharing the risks and costs of care collectively has to be a better way forward.
Lord Warner is right to insist that any solution must encapsulate intergenerational fairness. That means not asking current income taxpayers to pay twice – for this generation of older people and for future generations.
Lord Warner is therefore right to suggest that instead we should look at where wealth rests in our society – the vast majority is with people aged over 55 in the form of property, pensions and investments.
Where he is wrong is how this wealth could pay for care in a way that is fair, simple and sustainable. United for All Ages has argued for a ‘care duty’ on estates – say a 5% levy on estates worth more than £25,000. It would relate to an individual’s wealth but it would also deal with one of the biggest perceived injustices in the current system – losing your home to pay for care, just because you happen to have dementia for example.
Rather than anyone losing their home, everyone with estates over £25,000 would pay a small part to fund a better care system. Certainly it would be easy for people to understand and see where their money is going. And it would be sustainable – generating extra funding as our population ages and wealth rises.
The annual care funding gap for our ageing population is estimated to grow to £6 billion in the next fifteen years. In the grand scheme of public spending, this is relatively small beer. It’s certainly ‘do-able’. If public protests can lead to the government abandoning plans to sell off our forests, then we need to ensure that the commission and the government are ambitious in their plans to reform the way care is funded.