Social Care

Baroness Brinton Excerpts

Thursday 28th October 2021 Grand Committee

[Baroness Brinton (LD) [V]]

My Lords, I declare an interest as one of the vice-presidents of the Local Government Association. I congratulate the noble Lord, Lord Lipsey, on securing this important and timely debate, and for his interesting opening statement about a Labour Peer setting out how the private sector can help individuals to pay for social care. These Benches do not have a problem with that principle; if people wish to make provision for such costs, they should be able to. The big issue from these Benches is whether they understand the social care system for which they are planning to cover costs and whether it will be able to deliver when they need to use it.

I also thank the Association of British Insurers for its helpful briefing, which has wide applicability for the general population, as this issue is not just about financial products. The problem is that, for decades, reform and funding of social care has left us with this current mess—or, perhaps I should say, without the reform and changes to the funding of social care, we have been left with this current mess. It was extraordinary that both your Lordships’ House and the House of Commons each had to pass the Health and Social Care Levy Bill in one day, before Parliament could even see the detail of how the levy and new financial structures will work for social care. This is even before we see the Government’s White Paper on social care, which is still due to be published a few short months away—a line the Conservative Government have been running pretty much since 2015, when they refused to implement the Dilnot commission recommendations. This is very odd, given the Prime Minister’s insistence on the steps of No. 10, two years ago, that it was an absolute priority to

“fix the crisis in social care once and for all”.

For the past 30 years, social care has been funded in this peculiar dual way. Those below the income and asset cap get their care paid for, with the further problem of that being divided into the NHS paying for nursing care and local authorities paying for the personal care element and some, or all, of their accommodation and food costs—misnamed as the hotel costs.

All that the new levy announcement does is raise the cap on the savings element—the noble Lords, Lord Lipsey and Lord Balfe, set out the problems here. The cap should be viewed as a solution to avoid catastrophic care costs for individuals and is not a way to enable a private market. A cap in itself will not necessarily prompt a market for financial products to develop. In particular, a product that would dovetail with the cap would be almost impossible to create. As the noble Lord, Lord Lipsey, said, care needs and costs are unpredictable, both for individuals and therefore for insurers. That, frankly, is why there has been some reticence on the part of the insurers over the years to provide a specific tailored product for care needs, as medical progress over time will determine how many people need care and for how long they need it.

Some of the existing products have been mentioned already, but there are care fee plans or intermediate needs annuities; life assurance policies with care cover included; pensions, investment and retirement income products; and equity release and lifetime mortgages. It was fascinating to hear the noble Lord, Lord Balfe, talk about being plagued by people trying to sell him equity release after he had completed a form online. Equity release is already proving to be something of a problem, as such products are being sold to people every day on their television sets and radios for other uses, including their passing on to their children large amounts of money to provide deposits for homes. Some local authorities are now finding that people who started off as being privately funded move into a position of needing public pay once the residual equity has been sorted out with a prior demand from the bank which has offered the equity release. To a local authority’s frustration, when the property is sold after the death of the resident, someone who was thought to be a private payer suddenly becomes a bill that the local authorities has to pay and had no control over commissioning.

What of the future? The noble Lord, Lord Desai, with his usual expertise, set out the wider economic issues facing the public. The first and most fundamental of them returns to the point I started with. Because of the current muddle, we must have a clear state offer from the Government about the boundaries of who will pay what. I add to that a question for the Minister. Is it planned to run an extensive publicity campaign—not just the odd, occasional advertisement, but perhaps a leaflet to every house to raise awareness in advance of the levy being implemented and to explain to people what will be different? I believe that a large number of people think that, by paying the increase in national insurance to fund the levy, they will be exempt in future. As I have said to the Minister on more than one occasion since he took up his post, most people currently think that they do not qualify to have to pay for any element of their social care costs. Even more, virtually everyone is shocked to discover that there are different systems for the nursing element of their care and personal care. It is clear that we will now have to add to that the accommodation and food costs, which are certainly not included in the cap arrangements under the levy.

Any state offer absolutely must be easy to understand, with preferably just one system. The ridiculous system of having clinical commissioning groups and local authorities arguing about whether a patient’s need is caused by a health issue or is a personal care issue, and the divisive and shameful treatment of dementia as a social care issue, must stop. My brother and I are not alone in having to be present at meetings, in our case about our mother, where the NHS and local council argue about the percentage of nursing care versus personal care on the basis of whether it is needed as a result of her stroke or as a result of dementia. We witness this to a ridiculous degree. All sense of the treatment of the whole person is totally lost when different parts of the system spend enormous amounts of time and energy trying to deflect costs to other parts of the care system.

There is undoubtedly a role for the private sector in helping people to pay for social care, but there are two major stumbling blocks to making it happen. The first is that the public and the financial sector need an absolutely straightforward system that the population understands, especially regarding whether they will be covered by state provision or will need to pay for it from their own resources and may want to plan for that, say, from the age of 40. We need state provision that is not used by different parts to deflect responsibilities in payment, calling crises at the moment that people need to use the system. That means a streamlined system. For those who wish to use financial products to fund their care, the Chancellor must also make it plain what people can do and whether they will get some tax breaks for this careful planning. After all, it is prudent planning that will cover costs in future.

The second issue is much more fundamental. As many Members outlined in the debate of the noble Baroness, Lady Pitkeathley last week, we need comprehensive reform, not just structural reform to the care system. We need to think about this as part of the public health of our nation. Housing, health, working life and activity in later life are all also vital to reducing the need for people going into care homes, let alone having extended stays there.