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Monday, 1 August 2011

Middle Classes 'Must Find £50,000 For Care' As Spending On Elderly Is Slashed By 8%

Middle class pensioners should pay between £35,000 and £50,000 for their old age care, a review will recommend this week.

The Government would set this cap and pick up the rest of the tab itself.

Under the proposals by economist Andrew Dilnot, the middle classes will be encouraged to take out insurance to cover their costs.

The review comes as it was revealed yesterday that spending on care for the elderly is to be cut by more than £600million this year.

Councils are slashing costs by 8.4 per cent, sparking fears that pensioners will lose services and see the quality of their care diminish.

At present, anyone with savings or assets above £23,250 - including property - has to pay for their care in full, forcing thousands to sell their homes.

The review will raise that threshold so that more people with modest savings benefit, at a cost to taxpayers of around £3billion a year.

But the middle classes will have to pay more. Mr Dilnot will recommend they pay between £35,000 and £50,000.

Those who fail to buy an insurance policy could have to downsize their homes to get the cash they need.

Organisations including Age UK, the British Heart Foundation and the Alzheimer's Society yesterday wrote to Prime Minister David Cameron urging him to accept the Dilnot proposals.

They said: 'The social care system has been in growing crisis for years.

'Our organisations deal every day with people at the most vulnerable points in their lives who are either not receiving any social care support or a small level of help that is grossly inadequate to their needs.

'We call upon the Government to take this opportunity offered by the Dilnot Commission and produce a White Paper in the autumn detailing how it will create a sustainable and fair social care system, including how it will be funded.'

Chancellor George Osborne is resisting the plans because he believes they are too close to the 'death tax' proposed by Labour before last year's general election, under which everyone would have paid £20,000 into a compulsory insurance scheme whether they eventually need care or not.

But Deputy Prime Minister Nick Clegg and Lib Dem care minister Paul Burstow are both supportive.

The need for a new funding formula was laid bare yesterday when Age UK revealed details of how care services are being cut.

The charity received responses from 139 out of 152 councils and found that spending on social care is falling to just £791 per person over 65 in 2011-12.

This year the figure was £864 and in 2009-10 it was £872. The average spent on those over 65 who actually need care has been slashed from £2,448 to £2,335 over the past year.

There are currently 2.9million people who need care but only 1.1million get financial support from their local council.

Michelle Mitchell, charity director for Age UK, said: 'Funding for social care is already inadequate.

'We are fearful that even more vulnerable older people will be left to struggle alone and in some cases lives will be put at risk.

'We anticipate these cuts will condemn many more older people to a miserable existence behind closed doors struggling to keep safe and well.'

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