Queen's Speech 2017: government set to consult on social care plan

The government will go ahead with plans to overhaul the funding of social care with a consultation scheduled for the two-year parliamentary session but has not set out details about how this would work, the level of any cap or how much people would have to pay for care, reports Sara White

In the Queen’s Speech delivered on 21 June, the government said that it would ‘improve social care and will bring forward proposals for consultation’.

The government has committed to issue a consultation on future care costs, stating that ‘we will work to address the challenges of social care for our ageing population, bringing forward proposals for consultation to build widespread support’.

Original Conservative manifesto proposals to set a £100,000 capital floor on savings and assets to cover care costs were slated during the election campaign, with criticism of the lack of detail provided and the Conservatives' refusal to answer any detailed questions.

During the election campaign, Theresa May was forced to backtrack on the original plans and said there would be an undetermined cap on care costs, adding ‘there would be an absolute limit on what people will pay’.

‘Further reform is required to ensure that the system is prepared to meet the challenges of the increasing numbers of over 75s.

‘The ageing population presents one of our nation’s most profound challenges. It raises critical questions as to how as a society we enable all adults to live well into later life and how we deliver sustainable public services that support them to do so. 

‘To address these questions, the government will work with partners at all levels, including those who use services and who work to provide care, to bring forward proposals for public consultation. The government will consult on options to encourage a wider debate.

‘The consultation will set out options to improve the social care system and to put it on a more secure financial footing, supporting people, families and communities to prepare for old age, and address issues related to the quality of care and variation in practice.'

No further details are available at this stage nor indications of the timing of a consultation. This has not been set into the parliamentary legislative timetable. The normal consultation process allows a three-month consultation period after release of a green paper, or subsequent departmental consultation, followed by at least three months of government review, before any feedback is released, normally in a government policy paper.

The lack of detail on the manifesto plans was heavily criticised in the run-up to the election. Under the original Conservative manifesto proposals, home owners would have to pay for their care costs in residential homes and if cared for at home, using all their assets, including the value of their house and savings until their estate is valued at £100,000. The money would be collected after death so the residential property would not have to be sold upfront as care payment costs would be deferred and likely held by the local authority as a charge on the property in line with the current system.

The care costs would be deducted from the estate after death, leaving a maximum protected £100,000 pot, assuming that care costs have used all the remaining assets. This would then be paid to the state in the same way as inheritance tax.

This left a number of unanswered questions, including whether the £100,000 floor would be an individual allowance and as such would treat married couples and civil partnerships as separate individuals, as currently happens with inheritance tax (IHT).

The existing £23,250 limit on savings and income for care costs is per individual and recent tax policy has been to focus on individual taxation. It would be logical for the £100,000 figure to be allocated per person.

Currently, if a married couple, civil partner or a person over 60 lives with an older person who requires residential care, the other person can continue to live in the house and the property is not treated as part of the asset pot. Therefore, it is not included in calculations for care costs. 

Under the current system, the home is disregarded if the husband or wife needs to stay in the home and the other needs to go into a nursing home. If someone needs home care, in both circumstances it is the same £23,250 savings limit.

The number of people aged 75 and over is expected to increase by 70% between 2015 and 2035.

The government also abandoned plans to drop the triple lock on state pensions and is not going ahead with means testing the winter fuel allowance as set out in the Conservative manifesto.

Report by Sara White

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