Elderly people's cost of care to be capped at £35,000 following PM's rethink


The prime minister has announced that the cost of care borne by older people will be capped, despite earlier budgeting concerns by the Treasury and the Department of Health (DoH).

Care Home Fees

The health secretary Andrew Lansley said in July that recommendations to individually limit the cost of social care to older people would be halted due to an estimated £2bn cost to the Treasury.

However, in signs of a change in policy by David Cameron, the capping plans have been reinstated as part of a broader coalition relaunch due this autumn. The plans are expected to be outlined in an amendment to the Care and Support Bill.

The scheme will broadly align with the recommendations of the 2011 Dilnot Report, which proposed that the asset threshold above which individuals would be obliged to contribute to the cost of their care in old age should increase from £23,350 to £100,000.

The report's author, the economist Andrew Dilnot, also proposed a £35,000 'lifetime cap' on care costs, after which the government would take over payment. Since insurance would cover the £35,000 outlay, individuals would not be forced to sell property and other assets to meet ongoing care costs.

The capping initiative, which could be in force by 2017, is currently being fine-tuned by No10, the DoH and the Treasury.

The speed with which the government is now addressing capping has been assisted by the recent parliamentary reversal on Lords' reform, whose delay has freed MPs to debate the Care and Support Bill more closely.

According to a senior Tory source, Mr Cameron told the cabinet before the summer recess: "We've got to do Dilnot."

Last week, the deputy prime minister Nick Clegg said: "I personally have also felt we should go further and faster to deliver a properly funded system of social care for the elderly."

However, although Mr Cameron's rethink has been broadly welcomed, legal experts have warned that the proposals may not go far enough.

"Funding the cost of care for the elderly needs a wholesale change so the system is fair to all," said the Head of the Care Home Fee Recovery Team at Simpson Millar LLP.

"At present the average pensioner in care pays between £500 to £1400 per week for their care home fees. With people living longer this could easily run into thousands of pounds."

"This is a problem that potentially affects us all. If a limit on what the elderly have to pay is to be introduced, this is better than nothing. Unfortunately some older people might still be forced to sell their homes to fund the cost of their care until the proposed changes become law."

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