Ageing: Public Services and Demographic Change Committee Report
(Limited Text - Ministerial Extracts only)
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The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, I begin by congratulating the noble Lord, Lord Filkin, not only on raising this important debate but on chairing the committee that produced Ready for Ageing?. I thank the other members of the committee for their work on this valuable report. I am sorry that we were unable to discuss the report earlier in the year. However, had we done so, we would not have had the advantage or the pleasure of listening to my noble friends Lord Livingston and Lord Borwick deliver their superb and wise maiden speeches.
The committee’s report covers a number of very important and fundamental issues. As a result, it has provoked discussion and debate across government about how we can continue to work together most effectively to meet the needs of an older population. This country faces major demographic and economic challenges as a result of an increasingly ageing population. We welcome the committee’s report, which shares the Government’s ambition of making this country a great place in which to grow old. If we think about what such a country should look like, it is a place where older people get excellent care and support when they need it, where people are supported to live independently, where people plan and save to ensure a good retirement income in later life and where we make the most of the skills and talents everyone has to offer.
We know the challenge is significant. The quality of our later life is an issue which affects us all. The noble Lord, Lord Bichard, was right that cross-government co-ordination and focus are crucial to achieving success. We all have responsibility for ensuring we make the most of the extraordinary opportunity of increasing life expectancy, as the noble Baroness, Lady Finlay, rightly pointed out. These challenges are for individuals and communities, for local and national government and for the private and third sectors.
The Government’s response to Ready for Ageing?, published in July, describes the far-reaching programme of reforms we have put in place, as well as the plans we have for further work, which we believe will begin to address the challenges that the noble Lord and his committee have set out. The noble Lord, Lord Warner, was correct to highlight the pressures on the NHS. For example, the NHS handles more than 2 million unplanned admissions to hospital a year for people aged over 65. These account for 68% of hospital emergency beds and the use of more than 51,000 acute beds at any one time. It would simply not be sustainable for those admissions to go on increasing in line with demographic changes. We know that, to adapt and respond to future need, the health and care system needs to change. The challenges set out in the report create an opportunity for the NHS and local authorities to innovate and explore new ways of working, better to meet the needs of the local populations and optimise the use of available resources.
I listened with a very considerable measure of agreement to the noble Lord, Lord Bichard. Our vulnerable older people plan will strengthen primary care to make sure vulnerable and elderly people, including those with long-term conditions, have the support they need to keep them in better health and out of hospital. These are urgent and absolutely necessary changes to help ensure that our health service is person-centred, efficient and sustainable for the future. It is our ambition that people should receive high-quality, integrated and person-centred services that deliver the best outcome to the service user and make the system as a whole more efficient.
The noble Lord, Lord Filkin, questioned whether bottom-up change would be sufficient to transform health services. On 26 June, we announced the establishment of a £3.8 billion integration transformation fund, a pooled fund between local government and health to drive forward better integration between health and care services. It is perhaps more of a top-down initiative than the Government have been used to, but we felt that it was necessary.
The noble Baroness, Lady Finlay, and my noble friend Lord Mawhinney referred to the need for a 24/7 NHS, and my noble friend questioned how we would create that. Professor Sir Bruce Keogh, medical director of NHS England, is undertaking a review, consulting patients, the public and NHS staff to help shape the future of urgent and emergency care services. The review is investigating the provision of urgent and emergency care as part of a drive to promote more extensive seven-day services in the NHS and developing a national framework to build a safe, more efficient system. I can tell my noble friend that we are holding Sir Bruce to account for delivery of that framework. We urgently need to improve the way we offer care between our hospitals, primary and community care, and social services. Better integration and communication between these services is the key to success.
I can tell the noble Lord, Lord Crisp, that the NHS is planning for the longer term. In July, NHS England published NHS: A Call to Action. This is a first step in a sustained programme of engagement between NHS users, staff and the public around how the NHS will meet future challenges, including an ageing population and a significant increase in the number of people with long-term conditions. We are also consulting on major changes to the way in which people plan and pay for their care. The reforms will give everyone the peace of mind that they will get the care they need, and that they and their home will be protected from huge costs if they develop very complex care needs.
My noble friends Lord Borwick and Lord Griffiths and the noble Baroness, Lady Greengross, were absolutely right: enabling older people who can work to stay in work is critical to the economy and pension sustainability, and to the financial health and social well-being of individuals. The noble Lord, Lord Hunt, made that point as well. We have abolished the default retirement age, meaning that most people can now retire when the time is right for them. However, employment rates for older people remain lower than for some of their younger counterparts, and we must ensure that older people who wish to contribute in the workforce have the opportunity to do so. To that end, we have announced our commitment to publish an extending working life framework for action early next year.
The state pension reforms, which are currently in the House of Commons, will replace the two-tier pension system with a simpler, single-tier state pension for future pensioners. The full rate of the new state pension will be set above the basic means test, helping to provide a clear foundation for retirement saving. The reforms will underpin the rollout of automatic enrolment, which will see 6 million to 9 million people saving more, or saving for the first time, into a workplace pension. I can tell my noble friend Lord Griffiths that increasing the basic state pension by the triple lock is part of the secret here—a minimum of inflation, earnings or 2.5%. From April this year, the basic state pension has represented a higher share of average earnings than at any time since 1992.
The noble Lord, Lord Hutton, with his insight into these areas, spoke with great authority about defined contribution pension schemes. Automatic enrolment and the single-tier pension will provide a firm foundation for saving for retirement, but if the current forms of defined contribution pension saving become the default alternative to defined benefit schemes, the pension income of future generations from workplace pensions will be more uncertain than for past generations. Over the past 12 months, the defined ambition project, a joint project between DWP and the pensions industry, has been exploring options in a middle ground that do not leave either individuals or employers shouldering the entire risk of pension saving. The Government will shortly publish a consultation paper outlining the conclusions from this work and proposals for defined ambition pensions. Following the response, the Government will consult on draft legislation.
The noble Lord, Lord Filkin, and my noble friend Lady Thomas referred to the imperative of housing, as did the noble Baroness, Lady Wilkins. The Government are providing £315 million to help to develop specialist housing for older people and adults with a disability. That tailored accommodation will help people to retain their independence for as long as possible and provide a better quality of life at the same time as maintaining links to family and friends and retaining ties to their local communities.
I can tell my noble friend Lady Thomas that the care and support specialist housing fund will be paid out in two tranches. The first tranche will provide 3,000 extra specialist houses for older and adult disabled people; the second will support development of private sector housing for that group. All that is in addition to £4.5 billion being invested over the spending review period to deliver 170,000 affordable homes by 2015 for rent and affordable home ownership. That investment will lever in £15 billion of private sector investment, a total of £19.5 billion invested in new affordable housing. The National Planning Policy Framework, published last year, should deliver a wide choice of homes and plans for a mix of housing based on demographic trends and the needs of different groups in the community, such as older people.
Those are just a few examples of the wide-ranging reforms that are detailed in the Government's response to Ready for Ageing?. To follow up a point made by my noble friend Lord Livingston, work that we are doing today will mean that future generations will not be burdened with huge debts. As Albert Camus said:
“Real generosity towards the future lies in giving all to the present”.
Public provision must continue to adapt and respond as the needs and expectations of the population change. At the same time, individuals must take personal responsibility for planning for their later life, making choices and exercising control.
However, we are conscious that that is not the whole answer. I can reassure the noble Lord, Lord Filkin, and my noble friend Lord Ridley that work is ongoing across government to identify the scale of the challenges ahead. At a ministerial level, we will then consider how we should meet those challenges. I say to my noble friend Lord Mawhinney that this is definitely a matter for government. We will use this work to look for opportunities to innovate and explore new ways better to meet the needs of our local communities and optimise the use of available resources.
The Department of Health does not make its own projections of demographic changes, but is informed by work undertaken by academic experts in the field. Their models were developed under a programme of research funded by the Department of Health and other funding agencies. Inevitably, although they are plausible assumptions, there is significant uncertainty about the direction of future trends, and there is no consensus among academics. However, the department is confident that it is informed by the best modelling and evidence available.
My noble friend Lady Thomas rightly observed that social care funding is dropping. She made the point that it was not keeping pace with demand. I would not want to belittle the pressures on local government budgets. However, interestingly, the Health and Social Care Information Centre has recorded a drop in demand for social care. Local authorities report that preventive services, such as reablement of people leaving hospital, are successfully reducing demand on social care. We need to build on that.
The noble Lord, Lord Hunt, called for greater literacy in decisions about paying for care, and I completely agree. I am sure that he will therefore welcome the new advocacy powers that we have inserted into the Care Bill, which local authorities will be able to exercise.
My noble friend Lord Wei asked about the use of crowdsourcing as part of the chief scientist’s analysis. I can tell him that the chief scientist’s work is still being scoped, but I shall pass on my noble friend’s suggestion.
My noble friend Lady Tyler spoke powerfully about loneliness among the elderly, which is a serious issue blighting the lives of many people. We know that the quality of people's relationships has a massive impact on their physical and mental well-being. If we improve social and local connections, we can keep people healthier, active and more resilient for longer. If we do not, as she rightly said, people will continue to have their lives cut short. We are raising awareness of the issue and helping local health and well-being boards and commissioners to get better at measuring the issue in their local communities. This will help them to come up with the right targeted solutions and to drive local improvements that really make a difference. Loneliness and social isolation are problems that government alone cannot solve. For older people, as the right reverend Prelate was right to say, extending working life may be part of the answer, along with encouraging neighbourhood action, volunteering and participation.
The noble Lord, Lord Filkin, raised volunteering, as did the noble Lord, Lord Hunt of Kings Heath. It is vital that the voluntary sector, business and individuals work together to find the right solutions. The Government, alongside Age UK and the Age Action Alliance, are supporting a whole strand of work: a growing network of more than 465 organisations from all sectors of society, including businesses and the voluntary sector, working alongside older people to find practical solutions to the issues that the noble Lord, Lord Filkin, highlighted in his report. ILC-UK, the organisation with which the noble Baroness, Lady Greengross, is involved, is a member of the alliance along with several government departments and businesses such as Microsoft and all the major energy companies.
My noble friend Lord Livingston spoke about carers, and rightly said that they needed support. A summit last year, co-hosted by the Government and Employers for Carers, agreed that a task and finish group would be set up to consider national and international evidence on good practice to support carers who wish to remain in the labour market and to support employers to grow their businesses. He spoke, too, about the use of technology; it is a key priority for government to bring the technology revolution to health and care. We believe that at least 3 million people with long-term conditions could benefit from the use of telehealth and telecare services. Their use can also, incidentally, help social inclusion.
My noble friend Lady Tyler called for the Government to report back on progress. The Government’s response to this report is a first step in an important dialogue between the Government and the public, which must and will continue into the next Parliament. As part of this dialogue, the Government have committed to writing to the House of Lords Liaison Committee in a year’s time to update on the progress of their reforms, as well as providing any new evidence on challenges that might have arisen since the original report was published. This debate has contributed further to that dialogue and I thank the noble Lord, Lord Filkin, for bringing us together today and for his tireless work in raising the profile of these important issues.