Reducing the entitlement of poorer homeowners is the wrong way to cut the cost of this long-delayed scheme
In order to reduce the cost of its new social care funding scheme for England by an estimated £900m, the government has opted to reduce the entitlement of less well-off people. Under the proposals put forward a decade ago by the economist Sir Andrew Dilnot, which ministers announced in September that they had decided to take forward, a cap on contributions will be applied. Set at £86,000, this becomes the maximum that an individual pays towards personal care, including that delivered in their own home (but not daily living costs such as food and heating).
The point is to protect the minority of people who need long-term social care, due to dementia or other illness, from the financial catastrophe of losing all their assets. Currently, there is no cap on the total cost of care home fees (or the cost of home visits). People who have saved all their lives in the expectation of leaving an inheritance to their children can be forced to sell their homes in order to pay to be looked after. The new social care system, which will be funded by a health and care levy added to national insurance contributions, will create what Sir Andrew calls a “national risk pool for social care” for the first time.
