13 October 2006
Sir Derek Wanless's proposals for funding long-term care for elderly people amount to a 'huge subsidy for the rich' and play into the hands of campaigners concerned with protecting their inheritance, an influential Labour peer has said.
'Such an extension of the welfare state hugely benefits the better-off. It's a specific subsidy aimed at the very well-off. It's not a good use of very scarce state resources,' Lord Lipsey said at a King's Fund debate on Wanless's proposed 'partnership model'.
Under this, the majority of an individual's non-medical 'personal' care provided by care home and domiciliary care staff would be free. The rest would be funded through a top-up system of personal funds, matched pound for pound by state funding.
Wanless countered: 'The model does have its weaknesses, but on balance those are outweighed by the benefits.' An important by-product would be to incentivise more private spending on care, he added.
The model would remove the current means-testing system under which the 30% of care home residents with assets of more than £21,000 must pay in full or in part for the help they receive in day-to-day tasks such as washing, eating and dressing.
Means-testing would still continue for the very poorest, however, as their 'top-ups' to the desired level of care would have to be paid for through new state benefits.
Niall Dickson, chief executive of the King's Fund, said the current social care system concentrated resources on just the very poor and very sick. There was a lot of dissatisfaction with the funding system, which was seen as penalising savers, he said.
But Lipsey – a dissenting member of the 1997 Royal Commission on Long Term Care – dismissed complaints as 'a lot of agitation by people trying to protect their own inheritance'.
The majority of care home residents had no assets and so already received free personal care, he said. Implementing Wanless's proposals – estimated to cost around £3.5bn a year – would mean that resources badly needed for other areas such as staff training and care home improvements would be diverted to the richest 30% of elderly people.
But Sarah Pickup, director of social services at Hertfordshire County Council, warned against focusing too much on long-term reforms and not enough on urgent needs. 'We do need more state funding, but we need it now,' she said.
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