Elderly Social Care (Insurance) Bill [HL]

Baroness Neville-Rolfe Excerpts

2nd reading
Friday 16th July 2021 Lords Chamber

[Baroness Neville-Rolfe (Con)]

My Lords, the Bill deals, although at one remove, with one of the greatest and most welcome developments of the last two centuries. I refer of course to the extraordinary increase in average human lifespan that has occurred over this period. The separation of clean and foul water, advances in medicine and the development of vaccines, the discovery and invention of antibiotics and the recognition of the importance of safety in industrial processes, taken together with a realisation of the effects of smoking and diet on health and other factors, mean we have seen a rise in the average lifespan from well under 60 to around 80. This is a wonderful achievement but, like all advances, has thrown up problems. The greatest of these is the increased and increasing need of many elderly people for care, especially residential care, and its financing. The present arrangements are creaking.

As a society, we have taken a long time to grasp this nettle and, while Governments of every colour have dallied, the situation has deteriorated. Meanwhile, the financial position of local authorities, at least in England, has become much more challenging for various reasons, one of the most important of which was the cutbacks following the financial crisis of 2008. Some allowance has recently been made for local authorities to raise extra funds for social care, but the sector needs a significant injection of cash if standards are to be maintained, staff are to be rewarded properly and operators are to find it worthwhile to remain in the system.

What are the problems other than the need for money? One is uncertainty. None of us knows, early in life, how much care we will need over our lifetime. We might need none or we might need decades of care. Most of us will fall somewhere between these two extremes, but the financial difference between them is enormous, running into hundreds of thousands of pounds. Accordingly, another problem is fear—fear that we might be faced in old age with vast financial claims that will eliminate our lifetime savings.

All this seems to point to the need for an insurance-based solution, since in many areas of life that is how we cope with risk, with the advantages of pooling risk that it provides, but as my noble friend Lord Lilley has so eloquently explained, this is an area where private insurance cannot operate, mainly because of the fear that calculations will be upset by changes in government policy. My noble friend proposes to solve this dilemma in a typically brilliant way by harnessing the value of people’s houses after death in the way he has outlined as a component of what amounts to a voluntary, but state-guaranteed, insurance system which will operate at minor cost to taxpayers. It has been welcomed today as a workable solution by my noble and learned friend Lord Mackay of Clashfern, and the noble Lord, Lord Wigley, in a powerful speech, said it could play a part. This Bill represents a responsible and timely way forward. We need to act now. There is no sign that the Government will be able to do so quickly, so we should enthusiastically support this Bill which would make a contribution, large or small, to one of the greatest problems of our time.