Social Care Funding

Margot James Excerpts

Thursday 10th November 2011 Westminster Hall

[Margot James (Stourbridge) (Con)]

It is a pleasure to serve under your chairmanship, Mr Bone. I must apologise to you and to the Front-Bench spokespeople. Unfortunately, I will not be able to stay to the end of the debate. I apologise, but I have a pressing engagement in my constituency this evening.

I would like to begin by congratulating my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing a Backbench Business debate on such an important topic. Several speakers have alluded to the crisis in care funding at the moment and to the service being chronically underfunded. I want to throw some light on why I think that that has become the case.

Age UK reported earlier this year, in June I think, that spending on adult and social care rose by only 0.1% between 2004 and 2010. Crucially, during that period the numbers of older people needing care expanded significantly, to say nothing of those in other generations who also need care. The number of older people aged over 65 increased by 7.7%, while the number of very elderly—the over-80s—increased by 11.6%. While the care budget for older people was static—rising by 0.1% in real terms, to be precise—the numbers requiring that care have expanded, and that rise is continuing. It is interesting to note that, at the same time, other budgets were rocketing: spending on the NHS increased by 27%, on the police by 20% and on schools by 12%. That is salutary, because we can see how older people’s care has been treated and valued over time. We arrive at the point where—I agree with everyone in the Chamber—it is not enough. Most councils have therefore been under pressure in that area for a considerable length of time, which precedes the public spending review of the past 12 to 18 months. Most have responded to the challenge by tightening the eligibility criteria for the provision of care at home and by making far more use of private providers.

The situation in my borough of Dudley exemplifies the problem. I have visited approximately 10 private care homes in my constituency, and I apply my own inspection criteria—crudely, whether I would have willingly allowed my mother to be cared for in the home. We are fortunate in Dudley—certainly in my part of it, Stourbridge—with the overall quality of our homes, but the fees paid by the local authority for people to be looked after are imposing on the good will of the management and staff in the homes.

The local authority pays roughly £380 per week per resident, but for the past three years there has been no increase in the fees, while those homes have had to contend with rising costs including for fuel, food and even, to a certain extent, staff. So private homes are struggling; if they are small or family-run concerns, the show has been kept on the road with an enormous amount of dedication and hard work. The result is that self-funding residents are often charged significantly more than the local authority-funded residents. I have consulted Age UK, which has consulted lawyers, about whether cross-subsidisation can be proved, because that would be against the law. However, it is difficult to prove, although it strikes me that the discrepancy is so high that some homes must be using the fees of self-funding residents to cross-subsidise the local authority-funded residents.

The care at home situation is just as bad. The proportion of local authorities providing care to people in moderate need fell from 36% in 2004 to 21% in 2010. I do not doubt that the figure is still falling. That must surely be a false economy, because the less care provided to those in moderate need, the greater the speed at which they will develop substantial needs. In some ways, the home care sector is in worse shape than the residential sector. What I mean is that, in my own borough, the transfer from public to private provision appears to have worked less well for older people who need care at home than for those in residential care. Like the hon. Member for Luton North (Kelvin Hopkins), I have received a steady stream of complaints from the recipients of such home care, and the complaints are always the same, even though the providers might be different. There is a constant change in carers and no consistency of personnel, with a great variation in the standards of care provided, as well as in the kindness and compassion.

[Kelvin Hopkins]

I am interested in and sympathise greatly with what the hon. Lady is saying. Recently, I spent a day touring with a district nurse professionally employed in the national health service, and I saw the care and compassion that she gave to all her patients, whether it was re-bandaging or dealing with people suffering from cancer, and so on. The contrast between that professional, publicly employed person and what I hear about some of the private providers with inadequate staff is great.

[Margot James]

I have considerable sympathy with the hon. Gentleman in the context of home care. I find quite a few of my constituents bemoaning the rapid transfer from the local authority staff who used to provide care to the private sector. I am often in favour of bringing in the private sector, but it has to be done carefully and intelligently, and with proper checks and monitoring.

Another point, also made by the hon. Gentleman in his speech, is that carers come at very different times, without any consistency or reliability; they often come too early to help someone get to bed and too late to help them get up in the morning. In too many cases the service is patchy, inconsistent and fundamentally unreliable, and something needs to be done. Perhaps the business model needs to be looked at. It cannot be beyond the wit of an employer to employ more people at certain times of the day. That is probably the only answer, which means that more money might be needed, which I appreciate is a vexed question in the current climate.

I agree with other hon. Members that the Dilnot report is an excellent contribution to the debate, but it has some drawbacks. First, Dilnot has commented—perhaps not in the report but I have certainly heard him in speeches made about the report—that residential care means-testing is the biggest cliff face across the entire gamut of social care policy. Savings of more than £23,250, including the capital tied up in your home—68% of householders aged 65 and over own their homes outright, without a mortgage, so we are talking about a lot of people—disqualify people completely from funding support. No banding, no scaling up or down, only one figure, below which people receive 100% funding support and above which they receive nothing. In response, people have had to sell their homes. We have heard some sad examples, in particular from the hon. Member for Lewisham East (Heidi Alexander), and listening to several contributions I have appreciated the difficulty for people from a working-class background who have struggled and saved and whose assets are small in total. I will make a point about that.

People who are fortunate in their health will not need residential care and will not have to sell their home. For people who need residential care and have no assets and nothing to lose, that is okay as well. However, people who own their own home and need residential care are at a striking disadvantage to others of their age group. That is why I appreciate Dilnot’s broad strategy to cap an individual’s contributions to the care needed and to raise the threshold at which people become eligible for support. More work remains to be done, however, to identify the actual figures deemed fair and affordable for the taxpayer to fund. Raising the threshold to £100,000 is a bold move, but is it affordable? I do not doubt that that conundrum is on the Minister’s plate, and there are more problems with the cap.

[Kelvin Hopkins]

Dilnot pointed out that £100,000 is a crucial point at which the cost starts to take off, and his proposals would cost £1.7 billion a year, which is not a great deal in the scheme of things. After that, it starts to rise more rapidly. A £100,000 threshold would protect many people, such as my hon. Friend the Member for Lewisham East (Heidi Alexander) and her family.

[Margot James]

I thank the hon. Gentleman for his intervention. It is true that a £100,000 threshold would provide protection, and I hope very much that we can afford that element of Dilnot’s proposals. That threshold would provide a huge amount of help and protection for just the sort of cases that he and the hon. Member for Lewisham East mentioned.

Turning to the cap that Dilnot recommends, I believe that it should be rethought. He said that it should be between £25,000 and £50,000, beyond which no one should have to pay. Although my suggestion would introduce some complexity—I accept that that is a disadvantage—we must consider a scale on the cap that is linked to people’s assets. A one-size-fits-all approach, whether it is £50,000 or £25,000, does not reflect the huge variation in house prices throughout the country. The average house price in Dudley borough in my constituency is £145,000, but the average house price in Greater London is £420,000, so for families in my constituency, and perhaps in that of the hon. Member for Luton North, the cap on care represents a third of their assets, whereas for families in London in a house with an average value it represents little more than 10% of that value. That is unfair, and I hope that the Minister and his team will look at ways in which the problem can be overcome.

I am afraid we will to have to ask more of people who have seen the value of their home spiral over the last 25 years. I trust that with better use of resources, and thanks to Dilnot and the Government’s commitment to seek a cross-party solution to the vexed problem, we will no longer have to ask people to sell their home to fund their care. However, if we cap the amount that people must spend on care, we may have to ask them to remortgage part of the value of their home to contribute to the overall cost that Dilnot recommends. I cannot see a magic pot of £1.5 billion in the Government’s credit balance, so we must be realistic in what we ask them to do. Asking people to remortgage part of the value of their home to contribute to their care is not as bad as the current system, which requires so many to have to sell their home and to invest so much of the proceeds, if not all, in residential care costs.

In conclusion, the reaction to Dilnot has not been as favourable among health and social care managers as it has been among those of us, including organisations outside Parliament, who campaign on behalf of older people. They fear that they will have to find money from their cash-strapped adult and social care budgets. As the other main activity outside residential care is home care—I have described a situation that is far from satisfactory, as have other hon. Members—they fear that there will be less money to fund home care if they have to implement the Dilnot report to fund the higher cost of residential care. I share that concern.

What else can be done? I have said that I do not expect the Government magically to conjure up £1.5 billion in the serious and perhaps worsening economic situation. We must find a better way of managing our resources, and that money must probably come from one of the only protected areas of Government spending—the NHS. Hon. Members have mentioned that the Government have diverted £1 billion from the NHS to social care, and that has been well received, but I do not believe that it goes far enough. NHS spending has risen hugely in the past 10 years, and 27% for the six-year period does not cover the half of it. It does not cover the private finance initiative costs, which have been astronomical.

Too many older people in hospital would be better managed in the community. We have heard about bed-blocking, and that occurs in Dudley borough. People are waiting for residential care places, but the funding is not coming through to meet the need. That funding should be reconfigured more substantially in favour of community care. Many experts who know more about the NHS than I do—the King’s Fund, some hospital consultants and so on—recognise that we have too many hospitals. I am not saying that there is an easy answer, and no one wants hospitals on their patch to be closed, least of all me, but there may be a way of utilising that space and resource more effectively. I urge the Minister to discuss that with the Secretary of State to see what can be done. That would be a more fitting tribute to the Dilnot inquiry than trying to implement every detail in his report.

[John Pugh]

rose—