Age UK “Unless the Government changes course, less well-off older people and their families can effectively say goodbye to financial relief from the much vaunted ‘social care cap”

“Unless the Government changes course, less well-off older people and their families can effectively say goodbye to financial relief from the much vaunted ‘social care cap”

Age UK issues warning ahead of crucial upcoming debate in the House of Lords on the Health and Social Care Bill, as the Government undermines its own reform scheme 

Ahead of a key debate in the House of Lords in the next few weeks on the Health & Social Care Bill, Age UK is warning that the centrepiece of the Prime Minister’s social care reforms, the ‘social care cap’, will be beyond the reach of less well-off older people, unless the Government changes course. The Charity is urging Peers to vote against a Government change that waters down its own social care cap scheme, and that does so in a way that disproportionately penalises older people who are not well off, while leaving the better off more or less untouched.  

New analysis by Age UK of the Government’s impact assessment * for the reform reveals that a wealthier older person needing care could reach the £86k care cap in just a couple of years, whereas someone with fewer assets could still have a decade or more of paying fees ahead. The Charity also says that in fact, it’s quite likely that such a person would never reach the cap at all. (see analysis below) significantly reducing the likelihood they would ever see any benefit from the cap. The older person with fewer assets will likely have spent a greater proportion of their money on care costs by that point as well.

The Government’s own figures[i] show that although some older people will benefit from the cap, under the arrangements Ministers now want to be in place:

• More than 4 in 5 older people will not see any benefit from the cap at all[ii]
• The cap will be more likely to benefit better off older people – who have higher incomes, more wealth or live in richer parts of the UK – than poorer ones.[iii]
• Poorer pensioners are much more likely to die before they reach the cap than someone who is better off, with the same care needs.[iv]

Age UK expressed great disappointment when the Government announced in the autumn that it wanted to bring in a technical change to how progress towards the cap is calculated, one that makes it harder to reach, disproportionately hurting the less well off – just weeks after it had trumpeted its scheme as ground-breaking and providing our older population generally with reassurance over their care bills, in a way that no previous administration had achieved before.

When the Government’s proposed change was voted on in the House of Commons in the autumn, 19 Conservative MPs voted against it and 67 abstained. The Charity hopes that this degree of disapproval from the Government’s own MPs will encourage Peers to give the provision the critical scrutiny it requires.

The Charity says that the Government’s changes, introducing Clause 140 just as the Bill was leaving the Commons, is unfair and runs completely counter to Ministers’ ‘levelling up agenda’, because its impact favours older people living in areas where housing is more expensive, like the South East, while hurting those from areas such as the North and the Midland, where house values are typically lower.

Caroline Abrahams, Charity Director at Age UK said: “It really is extraordinary that the Government wants to make a change to its own social care cap scheme which will take it beyond the reach of most older people with low or modest amounts of income and wealth, while leaving the situation of the better off, in leafier parts of the country, more or less intact. This is patently unfair, regressive and counter to the Government’s ‘levelling up agenda’.”

“I am struggling to remember the last time a government of any complexion trumpeted a social and economic reform, and then ripped the heart out of it, of its own accord, less than two months later. The only possible reason for doing so is cost-cutting, but to expect those with the fewest assets to pay the price, while favouring the better-off, is completely the wrong choice, in our view. “

“It’s no way to treat older people and their families, who have waited so long for reassurance that they will not be impoverished by endlessly spiralling care bills. The Government’s social care cap scheme was supposed to provide it for everyone but, if this change goes through, huge numbers of ordinary older people can kiss that sense of relief goodbye – as, it should be noted, can most disabled people of working age who use social care too. The cap will be of precious little use to most of them either.”  

“We hope that members of the House of Lords will interrogate the impact of the Government’s proposed change on people who use social care, and their families, with tenacity and care. If they do we are confident that they will agree with us that undermining its own reform is the wrong thing for the Government to do, and vote the Government’s changes down. Ministers really do need to think again.”

Notes to editors

*Age UK have developed illustrative scenarios for two hypothetical women with identical circumstances except for their assets, based on the figures given in table 4 on page 31 and table 7 on page 36 of the Government’s Impact Assessment. Both of our hypothetical women were living in a care home which cost £683 a week, and both had an income of £239 a week. Mrs A had assets of £200,000 and Mrs B had assets of £80,000.

Mrs A

• Has an income of £239 a week and £200,000 in savings and assets to begin with (so is not eligible for any means tested support)
• Moves into a care home costing £683 a week
• Accumulates £483 a week towards the cap (£683- £200 hotel costs) or £25k a year
• Reaches the cap after 3 years & 5 months (179 weeks)
• Has spent £122k of her own money by that point
• After reaching the cap, continues to pay £200 a week towards her hotel costs

Mrs B

• Has an income of £239 a week and £80,000 in savings and assets to begin with (so falls below the upper threshold of the means test)
• Moves into a care home costing £683 a week
• However because local authority means tested support does not count towards the cap she does not accrue the full amount.
• In year 1 she accumulates around £12k towards the cap (£25k - £13k total mean tested support to date)
• By the end of year 2 she has accumulated around £22k towards the cap (£50k - £28k total means tested support to date)
• By the end of year 3 she has accumulated around £30k towards the cap (£75k - £45k total means tested support to date)
• After 3 years and 5 months Mrs B is just over a third of the way towards meeting the cap (£33k accumulated), it would still take more than a further decade to reach the cap.
• Has spent £69k of her own money and will continue to use her income and eat into her assets until she hits the lower threshold of the means test, at which point she will continue to pay her whole income less the Personal Expenses Allowance towards her care home fees until she reaches the cap, when she will continue to pay £200 a week in hotel fees.

[i] This analysis is based on the Government’s own figures - more here.

[ii] Table 2 page 32 in Government’s Adult Social Care Charging Reform Impact Assessment – link above.

[iii] Table 3 page 32 in Government’s Adult Social Care Charging Reform Impact Assessment – link above.

[iv] Table 4 page 31 in Government’s Adult Social Care Charging Reform Impact Assessment – link above.