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7 February 2008

Who needs care the most?

Neil Churchill argues that it’s the poor, not the middle classes

By Neil Churchill

The social care system has been creaking for decades, as Labour acknowledged when it came into office. It has become worse on Labour’s watch. Only last month, the Commission for Social Care Inspection said 275,000 people who needed help were not getting any, and another 450,000 were getting much less than they needed. In most of England, you will get help only if your needs are critically urgent. And the challenge will grow as our population ages: over the next 20 years, the number of people aged 85 will increase by two-thirds, doubling the number with dementia alone.

Having rejected a royal commission’s recommendations in England (but accepted them in Scotland), Labour is interested in proposals for a new partnership model but doesn’t know if it can afford them. With a green paper in prospect, public grumbles about care grow louder and louder, driven by a postcode lottery of entitlements and the creeping realisation that, for many people, life savings will be swallowed by huge care-home bills. These concerns are echoed in a report just published by the Smith Institute.

It looks like a clear choice between Blairite or Brownite principles. A Blairite approach would help the middle classes avoid losing their home to pay for their care by rewarding them for using the financial services industry to insure their risk. A Brownite approach might focus public spending on those most in need by ensuring that the poorest people received quality services and that help was available sooner, when people most needed it. In reality, the best of both approaches will be needed.

There is one stark truth that ministers must not shrink from getting across: we will all need to pay more for the kind of care we expect to receive. The average cost of care in a nursing home today is more than £33,000 a year and prices will rise as baby boomers demand better quality and care workers demand more than pennies over the minimum wage. In the past, Labour has pretended we can have it all: quality services at bargain prices. Ivan Lewis, the care minister, is absolutely right to reject as “bogus” the idea that care can be free for all.

The choices are about politics as much as about policy, and will go some way to defining Gordon Brown’s approach to public services. Who should benefit most from reforms? Should it be those of us with assets, who stand to lose our homes to pay care bills? Most newspapers certainly think so and this would be popular. Or should the priority be people with modest assets, who are missing out on care or getting poor-quality services? Let’s be clear – the more money Labour spends on helping the middle classes pay for their care, the less money will be available to improve quality of care for the poor.

The second choice is to decide whether or not it is a government’s job to help people keep their home if they need to pay for their care. Previous English Labour ministers have rightly rejected free personal care because it would benefit the rich and not the poor.

An alternative would be to let the market play a bigger role. Those with assets can be encouraged to insure against care costs or fund them by using part of their pension funds, or some of the equity built up in their home. This would reward responsible behaviour and ensure the bulk of public money was spent on those in greatest need. The government would need to play its part – for example, by picking up the bill after three years in care. But the money would be worth it politically if it meant Labour could promise that people would be able to pass on some assets.

Labour must decide who should pay for reforms and how much it can use existing spending. The government should focus on improving quality and access for the poorest. It is the individual’s responsibility – not the state’s – to protect the equity many of us have built up in our homes. Taxpayers’ money should be concentrated on those most in need. The market can and should help the rest of us to provide for ourselves.

Neil Churchill is chief executive of Asthma UK and editor of “Advancing Opportunity: Older People and Social Care”, published by the Smith Institute (£9.95)

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