Social Care Funding (EAC Report)

Lord Lansley Excerpts

Thursday 28th January 2021 Grand Committee

[Lord Lansley (Con)]

I am pleased to follow the noble Lord, Lord Campbell. It is an abject failure on the part of our political system that the reform of social care funding has not been achieved to date. I will refer briefly to what was my responsibility. In 2010, I asked Andrew Dilnot to prepare a review and make recommendations. His proposals continue to form a part of what should be the reform of social care funding in the future, but I do not think that people quite appreciate the value of what he proposed. It was not just that there would be a cap on the costs people would have to meet, creating, as it were, a fundable and insurable proposition. It is also that there would be a substantial increase in the capital thresholds and a taper, such that under his proposals nobody would have had to lose more than 40% of their total assets.

That would give people the reassurance, even if they were to self-insure or be self-funders, that they would not work all their lives and then find, as a consequence of the catastrophic effects of Alzheimer’s or dementia, for example, that they lost everything and their families got nothing. We have to arrive at this point and make this funding reform happen. I absolutely agree with the noble Lord, Lord Forsyth, and his committee that the cost will not be met simply by the Dilnot reforms. It will require a major injection of government funding. The cost of personal care support should be shared between individuals and the state. To my mind, the great benefit of Andrew Dilnot’s proposals is that people pay towards their costs with only a proportion of their assets; they do not lose all that they have built up during their lives.

I want to make one other point. Why did it not happen? We legislated for it in the Care Act 2014 and it was supposed to happen after the 2015 election. I was not a part of government at that point. I remember somebody in the Treasury saying to me that because part of the process of paying for this involved removing the domiciliary care exemption for people’s own homes, 200,000 people would pay more and only 100,000 would benefit. This quite ignored the fact that most of the 100,000 who would benefit at any time would themselves, on some previous occasion, have been the recipients of domiciliary care.

The noble Lord, Lord Hunt of Kings Heath, is quite right: if we go down this path and do not remove the anomaly of the domiciliary care exemption for one’s own home, we will have an enormous increase in domiciliary care relative to residential care. This would not be desirable, so it has to be paid for. National insurance on older workers is clearly one part of it and removing the domiciliary care exemption is another, but a broader contribution from taxpayers will inevitably be part of it too. But it should not be taxpayers alone, otherwise the intergenerational lack of fairness of young people contributing to the future care of older people, in circumstances where those older people do not contribute but have large assets, would be intolerable.