Still playing for time

11 Dec 08

Ministers’ radical plans to overhaul the long-term care system could be parked yet again, as the recession starts to take its toll on services

If a week is a long time in politics then half a year is a lifetime. When Health Secretary Alan Johnson launched his consultation on the future funding of long-term care in May, who could have predicted that the world would then slip into an economic crisis?

The consultation began in a spirit of springtime optimism, with ministers promising people a chance to shape their future and to reshape the social care system around the principles of personalisation and choice. It ended, on November 28, in the wintry shadow of a Pre-Budget Report that had ministers frantically pulling fiscal levers in an attempt to kick-start the economy and boost consumer confidence.

How we care for people in their old age and who pays are issues that have stalked the government for the past decade. It is never high enough up on voters' priority list to require immediate action, but is equally never going to go away. The system is plagued by two chronic problems: historic underfunding and a lack of national eligibility standards – needs that might qualify you for state-assisted care in one authority would not necessarily do so next door. Coupled with a rapidly ageing population, these factors present a pressing case for reform.

Yet not much has happened. A brave attempt to settle the issue was made in the early days of the Labour government with the establishment of the Royal Commission on Long Term Care. It reported in 1999, recommending – with the exception of two dissenting members – that the state meet the costs of all nursing and personal care. The commissioners were thanked for their efforts and their major recommendations were politely ignored.

More recently the subject has inched back up the political agenda. A high-profile report from former NatWest chief Sir Derek Wanless, under the aegis of the King's Fund, set out the scale of the problem and the likely costs and recommended a basic level of state care topped up with payments from individuals.

Out of the debate emanating from Wanless came the promise of a green paper, which has yet to appear. The latest expectation is that it will emerge some time early next year once the consultation responses have been collated and digested.

So are ministers finally beginning to take the issue seriously? Social care is certainly playing a bigger role in government discourse. There was a mention in Prime Minister Gordon Brown's party conference speech and new social care minister Phil Hope occupies a higher place in the Department of Health's hierarchy, as minister of state, than his predecessor did.

The Opposition has its doubts. Conservative health spokesman Stephen O'Brien accuses the government of 'dithering' on the issue of social care. 'Tony Blair said he would do something about this in 1997, yet they have consistently delayed taking the action that matters, and there is no indication that they intend to bring forward anything substantive before the next election,' he says.

But other voices are slightly more sanguine. Andrew Harrop, director of policy at Age Concern, says it might have been easier for ministers to grasp the social care nettle a few years ago when the government's popularity would have allowed it to sell higher taxation for better public services.

But he adds: 'In other ways, I think the context has changed for the better. People realise the implications of demographics… Perhaps we could never have had the sort of serious debate decision-makers are up for now until after the Turner Commission on pensions, which set the model for reaching long-term, cross-party agreements on issues that are so strategically significant that they needed to be got right and not unpicked every few years.'

Consensus is a word the government likes to emphasise. At a recent conference Hope stressed that increasing life expectancy would put considerable extra pressure on social care services. Without change, the government faces a £6bn funding black hole in 20 years time.

'We're keen to build a consensus across the country about how we [pay for] this,' he said. 'The system needs to be affordable. It can't be a blank cheque. We have to come up with answers that are affordable… This is not just a debate for experts and ministers, it's a debate across the country.'

The government is under mounting pressure from all quarters to take action. The Commission for Social Care Inspection has recently added its voice to the debate. Its October report, Cutting the cake fairly, seen by some as a stepping stone to the green paper, backed radical reform of the care and support system.

The report painted a grim picture of a system that is not working for most people. While local authority-provided care standards are good and getting better – something borne out by the ratings published by the CSCI in late November – the number of people receiving these services is getting smaller as cash-strapped councils tighten their eligibility criteria. People and their families who do not meet these criteria are left to manage by themselves, often at great financial, emotional and physical cost.

The watchdog said that everyone, regardless of their income level, should be entitled to a discussion about their care needs and good quality information about the options open to them. 'The questions about the role of our care and support services in future, including how they will be funded, grow in urgency,' said CSCI chair Dame Denise Platt.

This is a diagnosis shared by the Local Government Association. Anne McDonald, programme director for community wellbeing, agrees that action is urgently needed as much of the current system is coming apart. She says: 'We're really looking for a system that is much less complex and we would certainly say that we need an advice and information system that's available for anyone, rather than the current system, where you have to have assessments to get into it.'

It is widely agreed that good, freely available, advice is sorely lacking and public ignorance about care entitlements, or lack of them, is widespread. To the generations who have grown up with the welfare safety nets of the NHS and the benefits system, it comes as a nasty surprise to find that there is no state support for their care needs in old age.

A think-tank, the Resolution Foundation, has spent the past year examining the long-term care issue from the perspective of the so-called 'working poor' – a group increasingly squeezed out of the social care system. Chief executive Sue Regan says the first 10 or 15 minutes of focus group sessions were always spent getting people over the shock that there was no state support available to them.

People assume that because they've paid National Insurance all their life, that will pay for at least some of their care needs when they're older, she explains. 'I think it's right that the Department of Health has been trying to get behind that with people. There needs to be a much higher level of public debate.' Views on the usefulness of the social care consultation are mixed. John Dixon, president of the Association of Directors of Adult Social Services, lined up with ministers to launch the debate in May. He is optimistic and maintains that the consultation has done what it set out to do. 'There's a high degree of consensus and my view and my belief is it's likely to be a broadly cross-party consensus,' he tells Public Finance.

'There's a recognition of the urgency of the issue by everybody and a feeling of a broad coalition of interest and approach. We're looking forward to the green paper.'

But for others the consultation has failed in the one thing it set out to do: start a genuine public debate. Harrop says the consultation has been useful but has not reached out to the general public. 'What it has done, very well, is to generate a discussion between informed insiders, and I think that is beginning to lead to, if not a consensus on the answers, at least to agreement on what the big issues are.

'I think that there's certainly been movement in the argument about the extent to which the system should be national or local. There's a growing sense that there should be more national control over social care.' He adds that, while the discussion over who should pay for care is by no means resolved, people have a much clearer idea of what the trade-offs and options are. 'Should there be more collective sharing of risk or should people be helped to make provision for themselves?'

It can't be forgotten that while politicians, campaigners, social care professionals, voluntary carers and a host of other stakeholders were considering and submitting their responses to this debate, the country was gradually falling into the grip of an economic crisis of a severity not witnessed for decades.

Regan blames the crisis for overshadowing the consultation and preventing it from turning into a meaningful dialogue with the public. 'Trying to have a debate at the moment about what you might pay for your long-term care when people's costs are going up and they're concerned about their jobs is very difficult,' she points out. But it is an opportunity for the government to take a fundamental look at social care, she says, adding: 'Given we've increased spending and debt by so much, there's obviously a threat over how much any government would be prepared to invest in the care and support system.

'But overall we should be seeing it as an opportunity because it has completely changed the terms of the debate, and there are many different areas of public expenditure that can be looked at differently now.'

Another dimension of the crisis is the extra pressure it is likely to place on social services now. Dixon says the credit crunch is going to make people more quickly dependent on public resources than they would have been in the past 'because of the drop in housing prices, the drop in people's savings and availability of money'.

'Therefore they're going to be turning to us for help and when they do turn us for help, if they've had to sell their house for care, the money is going to run out more quickly.'

There is also a sense that the credit crunch might, for the short term at least, have made the government less likely to pursue radical funding options. Social insurance is increasingly touted as a likely solution, but does the economic instability make people cling to what they know?

Harrop is ambivalent. 'I think [the economic crisis] may mean that some of the more radical ideas for new taxes or social insurance schemes won't happen soon, but it doesn't necessarily mean they're off the agenda entirely,' he says. 'They could still happen in the 2010s but ministers would have to be very careful in how you sold them to the public.'

Dixon, who has given some personal backing to the idea of a social insurance system, agrees that the way policies are sold to the public is crucial. 'If [social insurance] is brought forward as a method of cutting the cost that government has to put in to supporting older people, obviously it's going to encounter massive opposition,' he says.

But if it's brought forward in recognition of the fact that some people get seriously unlucky in the care lottery then it's an idea that might have some traction. 'I think there's a growing recognition that many people want to see more averaging out so people were not put in this lottery [in the first place]' he says.

'It is really seriously unjust, all parties are agreed it is unjust… and the question is what sort of system do we put in place which is affordable to the country and would enable the risks of that to be spread? Some form of social insurance system is an idea that is beginning to gain some ground.' All parties accept that more money will have to be found to pay for social care.

'We need some more money from the state but also I would say there is a recognition that there will always be a contribution from the individual,' says the LGA's McDonald.

'Certainly we said in our response to the consultation that things like insurance and equity release are fairly simple ways of making those sort of things attractive. The government should consider ways of making it possible to save for this eventuality. People come to social care in crisis, it's not something they're planning for.'

But with a general election 18 months away, hope that the green paper will lead to any actual legislative changes is diminishing. Some campaigners privately fear the government has no clear idea how it wants to respond to the issue. They worry that the green paper, when it finally sees the light of day, will not give much of a policy steer.

McDonald hopes to see action of some kind soon after the paper emerges. 'One reason why nobody's tackled this in the past is because everybody has thought it will take too long to change. The optimistic part of me would want to see soon after the green paper at least some steps along the way put into place,' she says.

The new year should indicate whether this optimism will be borne out.


  • Vivienne Russell
    Vivienne Russell is managing editor of Public Finance magazine and

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