Care Bill [HL]

Lord Hunt of Kings Heath Excerpts

Tuesday 29th October 2013 Lords Chamber

[Lord Elton (Con)]

What the noble Baroness has just said prompts me to point out a difficulty. We are in an age when there is controversy about spirituality, when people can actually lose their jobs over issues of spirituality. If there were to be a case arising under this legislation in which such a matter arose and spirituality was not mentioned in the Bill, the position of those people would be a great deal weaker than if the Bill was amended as my noble friend suggests. Like the Chief Whip, I know that it is contrary to our normal custom to divide at this stage, but it seems that this is an issue of sufficient importance on the one hand and of narrowness of scope on the other to make it both necessary and painless.

[Lord Hunt of Kings Heath (Lab)]

My Lords, as this is a new stage I will just declare my interest as chairman of an NHS foundation trust, president of GS1, and a consultant and trainer with Cumberlege Connections. With the noble Baroness, Lady Barker, I, too, was very interested in this discussion at an earlier stage of the Bill. Our concern is that the original Government view is that spiritual issues would be embraced by Clause 1(2)(b) under the words “emotional well-being”. The noble Baroness, Lady Barker, and I did not feel that that was sufficient. Indeed, we had some worries that spiritual well-being could actually be subsumed under the terms “emotional well-being”.

The noble Earl, Lord Howe, has, I think, met our concerns. As he said in his letter to us, adding “beliefs” to Clause 1(3)(b) enables spiritual beliefs to be encompassed within that term without excluding any other forms of belief that may not be described as spiritual. I think that meets the concerns that I had about this matter. I would like the noble Baroness, Lady Barker, to draw a distinction between that and the specific issue that noble Lords have raised in relation to the health service, which is clearly designed to ensure that the NHS employs a chaplaincy service and which I absolutely subscribe to. Indeed, I pay tribute to the chaplaincy service up and down the country. However, this Bill is about a different set of circumstances. To the noble Lord, Lord Elton, I say that employment issues do not arise in this regard. We are talking about Clause 1 of the Bill, which is about promoting the individual well-being within the context of the Care Bill. I understand the point that he raised, but I do not think it arises in this context.

I would, though, say to the noble Lords, Lord Hamilton and Lord Cormack, that, reading the Companion, they are definitely right to bring this issue up on Third Reading. It is quite clear that an issue was raised in the debate on Report and the noble Earl agreed to look into it. He has now brought forth an amendment, and the Companion is absolutely clear that amendments on Third Reading are,

“to enable the government to fulfil undertakings given at earlier stages of the bill”.

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[Lord Elton]

My Lords, on the noble Lord’s response to me, if an employee is able to point to statute and say that they are carrying out a requirement of statute, that has a very considerable bearing on tribunal cases and should not be brushed aside.

[Lord Hunt of Kings Heath]

My Lords, I do not seek to brush it aside. However, this clause relates to the responsibility,

“of a local authority, in exercising a function under this Part … to promote that individual’s well-being”.

Spiritual issues are subsumed under the amendment moved by the noble Earl, Lord Howe. With the greatest of respect, this does not relate to an employment law issue between an employer and an individual. This is very much around the kind of support that should be given to an individual by the local authority. There is a distinction between the situation that the noble Lord raised, and the issue that is set out in this clause.

[The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)]

My Lords, before I move to the matter in hand, I thank noble Lords for the tremendous dedication that they have shown to the scrutiny of the Bill during its passage through the House. It is a landmark piece of legislation, and I hope that the House will agree that the changes that the Government have made in response to the debates that we have had have strengthened the Bill so that it will pass to the other place in an even better state. Many noble Lords across this House have dedicated impressive time and energy to improving the provisions in all parts of the Bill, but time does not permit me to thank all noble Lords individually, as I would like to. However, I thank again those noble Lords who played such an important role in improving the Bill as members of the pre-legislative scrutiny committee.

I turn to my noble friend’s amendment. Under Clause 1, local authorities must promote individuals’ well-being and must also have regard to individuals’ views, wishes and feelings. As I set out during our debate on Report, we consider that these provisions mean that a local authority would take a person’s spiritual views, wishes and feelings into account in promoting their well-being. However, in response to concerns raised by a number of noble Lords on Report, I have now tabled an amendment to make it absolutely clear that these matters should be considered where they are of importance to the individual.

My amendment adds “beliefs” to the matters to which a local authority must have regard when exercising care and support functions. Having regard to someone’s beliefs includes their spiritual beliefs; for example, ensuring access to an appropriate figure of religious authority during palliative care. This approach achieves the same aim as Amendment 1 in the name of my noble friend Lord Hamilton, but I suggest to him and to the House that the government amendment is preferable, for two reasons.

First, my amendment quite deliberately does not refer specifically to “spiritual” well-being, but applies instead more widely to beliefs, which was the point made very effectively by my noble friend Lady Barker. That is because we do not wish to exclude those who may not consider themselves to have “spiritual” beliefs. That issue was raised by the noble Lord, Lord Warner, on Report, in relation to humanists.

Secondly, despite the comments of the noble Baroness, Lady Warnock—to whom I listened as always with great attention—spiritual well-being is not a well understood or defined concept. It carries a risk because it may confuse the practical application of the well-being principle on an individual level. There is another problem here. My noble friend’s amendment would effectively mean that local authorities had a duty to promote an individual’s spiritual well-being or beliefs. It is not appropriate to require a local authority to promote spiritual matters, except in so far as they affect the emotional well-being of a person.

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[Lord Best (CB)]

My Lords, speaking as president of the Local Government Association, I can confirm that the LGA supports this amendment and underlines the importance of sound professional advice before people, particularly elder people with care needs, make major financial decisions, not least in relation to the use of their homes as a source of finance for meeting care costs.

Facilitating access to such advice, of course, will add to the duties and burdens on local authorities. That must be recognised, as with the implementation costs for the so-called Dilnot arrangements, in the financial settlement that central government makes with local government. The costs involved for local authorities may not be very great but they should nevertheless be acknowledged. With that point in mind, I am delighted to give firm support to the amendment. I am sure that, as always, the noble Earl will respond helpfully and wisely.

[Lord Hunt of Kings Heath]

My Lords, perhaps I may raise a couple of points with the noble Earl, Lord Howe, on this. First, to reinforce the point made by the noble Lord, Lord Best, about the cost falling on local authorities in providing facilitation to independent, regulated financial advice, there is a much more general point about the capacity of local authorities to implement the measures in this Bill. The Bill leaves us, albeit with many amendments, with an underlying concern about whether local authorities will have the wherewithal to implement a raft of new responsibilities over the next few years.

Secondly when the noble Earl argued against similar amendments on Report, he spoke of the concerns of local authorities that they might be held liable if they referred a person who comes under the Act to a financial adviser who subsequently gave poor financial advice. We have heard from the noble Lord, Lord Best, that the LGA supports the general thrust of my noble friend’s amendment. Can the noble Earl confirm, first, that a regulated financial adviser will be subject to FCA requirements and come under its disciplinary and regulatory codes? Secondly, can he reassure local authorities that they can offer names of regulated financial advisers in the way that I understand a number of local authorities do at the moment without fear of subsequent action being taken against them? I was puzzled by the argument put forward on Report and it would be good to have this cleared up at this stage.

[Earl Howe]

My Lords, Amendment 3 brings us once again to the important matter of financial advice. As we have covered this subject at some length previously, and in the interests of time, I will endeavour to keep my response reasonably short. At the same time, I do not intend to make brevity a substitute for substance.

My discussions with the noble Lord, Lord Lipsey, my noble friend Lord Sharkey and the noble Baroness, Lady Greengross, and my officials’ discussions with the financial services industry have persuaded me that we are all seeking the same end point for financial information and advice. I believe that any apparent distance between the positions of the Government and noble Lords on this issue reflects only the way that I have expressed our intentions thus far. We want to ensure that when people take decisions about how to fund their care it is done in a considered and informed way. We agree that the local authority has a pivotal role to play in ensuring that this happens. I want to set out what I see that role as being in the hope that noble Lords will agree that we are indeed in concordance.

We believe that the local authority should take a proactive role. What does that mean in practice? Under the new system we expect many more people, a large number of them self-funders, to approach the local authority to start their meter running. This provides an invaluable opportunity for local authorities to reach out to these people and tell them about the support that is out there to help them better plan, prepare and provide for the costs of their care. It is particularly important for self-funders that this includes the relevance and the availability of regulated independent financial advice. To pick up the word in the noble Lords’ amendment, this should be a facilitative role for the local authority, providing a nudge in an appropriate direction.

In trying to define what we mean by facilitation, I wholeheartedly agree that handing out a leaflet or placing a page on a website is not sufficient. Instead, local authorities should talk to people and use the opportunity of contact with self-funders and others to give them individually tailored advice that suits their personal circumstances. They are likely to know something about a person’s financial situation and so will be able to tell them about the range of information and advice that might be most relevant to them in considering their care options, whether that is light-touch budget planning or advice from a regulated organisation. It would not be sufficient for local authorities just to tell a person about the types of information and advice available. They will also have to explain how it could be accessed and provide information to enable them to do so.

There is more work to be done before we can finalise what the guidance will say. To get it right, we will need to work collaboratively with stakeholders, including the financial services industry. We have begun to do that already and have had initial discussions and workshops involving representatives from the finance industry. They have confirmed what we all know of some of the necessary complexity in the system, so how and at what stage a person or their family is facilitated to take up regulated financial advice will depend on how and where they have made contact to obtain information and advice. We will gather examples of best practice to inform statutory guidance to help local authorities identify the types of information and advice that different people may need, inform them of those options at the right time and help them to access them.

In addition to the call for evidence and responses to the consultation on funding reform, background work has already been undertaken over the summer that supports the development of statutory guidance. Work commissioned through the Think Local Act Personal partnership has resulted in two publications on information and advice, principles for the provision of information and advice and an interactive map evidencing the difficult pinch points in people’s typical journey through the care system.

We have commissioned detailed work with six local authorities chosen from 40 examples of current practice collected earlier this year to draw together evidence on benefits and effectiveness in developing information and advice services. A number of those examples, including West Sussex, involve directing people to regulated independent financial advice. Helpfully, the ABI has invited my officials to participate in a workshop on access to financial advice being held on 14 November, which we expect further to support the development of guidance.

I am confident that no further amendments are needed to effect what I believe is a shared ambition. The Bill sets out the framework, the skeleton if you like, but it is the statutory guidance and implementation support that will put meat on those bones. What I have set out today is what we will put into practice through guidance. This guidance will be developed in co-operation with all interests, including the Association of British Insurers and the Society of Later Life Advisers, SOLLA, which will build on the good practice that already exists in many areas. We really want this to be the product of co-development which achieves the aims that I firmly believe that the noble Lord and I share.

The noble Lord, Lord Hunt of Kings Heath, expressed concern about what I said on Report about the possibility that local authorities could be held liable in the event that a regulated financial adviser gives poor advice. He pointed out, quite rightly, that such an adviser would be covered under FCA codes, and so on. The issue here is about the local authority making a recommendation to an individual adviser. We do not consider that there is any problem with local authorities providing a list of advisers from whom a person could choose.

On the impact of local authority responsibilities, we have established a partnership with the Local Government Association and the Association of Directors of Adult Social Services and have set up a joint programme and implementation board. We have a lot of ground to cover, and I think that no one would deny that we have our work cut out over the next few months, but I can tell the noble Lord that, together, we are absolutely committed to providing the support that is needed by local government to enable it to fulfil its functions. I hope that we have achieved a meeting of minds on this matter and that what I have said today will give the noble Lord, Lord Lipsey, sufficient reassurance to withdraw his amendment.

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[Lord Hunt of Kings Heath]

My Lords, I am looking forward to the response of the noble Earl, Lord Howe, and hope that he can reassure the House on this point. It is important that the House should be reminded that the universal deferred payment scheme was discussed on pages 65 and 66 of the Dilnot commission report, which set out an analysis and evidence supporting its recommendations. It explained why the current arrangements and deferred payment schemes were not widely used, and why in the main report the commission recommended extending the current system to a full universal offer across the country.

In its arguments, the commission accepted that local authorities should be able to charge interest and recover their costs and that a scheme would be cost-neutral to the state, although it might require an initial cash injection. Dilnot also made it clear that the Government needed to strengthen and standardise the deferred payment scheme in the light of their decision on the level of the cap, means-testing and the contribution to general living costs.

I accept that the scheme was not intended to be generally available to the very wealthy and asset-rich. As my noble friend Lord Lipsey has so convincingly argued, though, being required to spend your assets down to £23,250 seems far too restrictive to deliver a viable scheme. Indeed, as it would be of no use whatever to people of middle income, it is very difficult to see if anyone at all is going to use the scheme. My question is: why have the Government been consulting on such a figure? Does that actually mean that they do not want the scheme to succeed? Do they recognise that it cannot possibly succeed if you have to get down to such a low figure before the scheme can apply?

My only reading of why the Government have consulted on this low figure is because of Treasury concern about the initial cash injection. Is that so? Will the Minister also acknowledge that there is a question about whether in the long term—or indeed in the short term, because the scheme will begin to pay for itself within a very short time—his department thinks that there is going to be a cost-neutral scheme? It will be interesting to hear from him about why the Government seem so cautious and have been consulting on what seems to be such a low figure.

For the reasons that my noble friend has persuasively put forward, although in the end the number of people who will use the scheme may be counted in their thousands rather than their tens of thousands, there is no doubt that having a scheme available will provide a great deal of comfort to many people and their families, and it would be a great pity if this was going to be stillborn. We need to see a scheme that will be practical and will not squeeze middle-income people. I hope that the Minister will be able to reassure the House that the Government are having second thoughts in this area.

[Earl Howe]

My Lords, Amendment 5 returns us to the issue of deferred payments. I begin by saying that I welcome the opportunity to debate this subject again. Unfortunately, the Government’s position on it has been fraught with misunderstandings, and I would like to take this opportunity to dispel at least some of those.

First, I remind the House that a consultation on funding reform has been running over the past three months, and it closed last Friday. During these three months, officials have travelled across the country explaining our proposals and seeking people’s views. What we have put forward so far are proposals—something for people to consider. These are not set in stone. We will listen to what we have heard through our consultation, and indeed in this Chamber, as we develop our policies over the next few months.

The purpose of this amendment, as the noble Lord, Lord Lipsey, has explained, is to ensure that anyone—even people with assets of great monetary worth in addition to their main home—can have a deferred payment agreement. I have to make it clear that if one takes this amendment literally, I disagree with that principle. I do not think the public purse should be helping people who do not need financial support to pay their care fees. This would seem a long way from the Dilnot commission’s view that deferred payments should be used to support people who,

“would be unable to afford care charges without selling their home”.

For a person with a substantial sum in their bank account or substantial liquid savings, a deferred payment agreement might be a cheap loan—a convenience, one might say—but it would not be serving its core purpose.

I hope that we can therefore agree that the principle of having an upper threshold for non-housing assets is a sound and a necessary one. If we agree that this is a sound principle, all that is left to do is agree on an amount. Our consultation sought views on that amount. The noble Lord, Lord Lipsey, asked what was wrong with an asset threshold of £118,000. From April 2016, we are extending means-tested support for people with up to £118,000 when the value of a person’s home is taken into account in the financial assessment. This determines when an individual may be eligible for local authority support with their care costs. Deferred payment agreements are designed to help people to pay for their care costs; their ability to meet these costs in the short term will be dependent on their liquid non-housing assets rather than housing wealth. I can say to the noble Lord that we are happy to consider using a threshold of £118,000 as we analyse the consultation responses. We are happy to consider a range of figures.

The noble Lord, Lord Hunt, asked why we proposed the £23,250 threshold. We were seeking to identify those people most at risk of having to sell their home to pay for their care. The reason we proposed £23,250 specifically is because it provides consistency with the threshold for means-tested support when the value of someone’s home is not taken into account, and with the principle that people with non-housing assets under that amount are likely to need state support to pay for their care costs. Indeed this is the same figure and the same reasoning that the previous Government applied in their White Paper. Therefore, from that point of view if no other, it is a little surprising to hear the noble Lord, Lord Hunt, arguing against it.

There is an interesting point about people with more than £23,250 in savings. About 60% of people entering residential care are state-supported, meaning that they have only limited assets. Of the remaining 40% who enter residential care as a self-funder, less than half have liquid savings of more than £23,250. This means that the proposed threshold of £23,250 excludes only the richest 15% of people entering residential care. By increasing the liquid savings threshold to £118,000, the scheme would be available to all but the richest 5% of people entering residential care. I hope that that is a helpful contextual analysis. However, I reiterate—particularly to the noble Lord, Lord Lipsey—that we are not wedded to the figure of £23,250. We will analyse the responses to the consultation before making any further decision.

To answer the question posed by the noble Lord, Lord Hunt, about whether the scheme will actually be cost-neutral, we intend and believe that in the long run the scheme will be cost-neutral. We have committed £330 million to fund the implementation of the cap cost system, and deferred payments to cover the initial set-up costs.

I hope that in the light of what I have said the noble Lord will, on reflection, agree that his amendment would be undesirable as drafted and that he will be content to withdraw it.