Neil Cook
Partner, Solicitor & Head of Business Services
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Date Published:09 Mar 2016 Last Updated:01 Aug 2021

Care Bill 2013: Is this the solution to our unfair system?

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The current system for funding Adult Social Care in England has been criticised as unfair, complex and financially unsustainable. There are significant local variations in who is eligible for what kinds of support and many complicated local and national rules that apply to the funding and different types of social care services. We are all living longer with over a quarter of our population now aged over 65 and this figure is expected to increase dramatically over the next 20 years. This means that the demand for adult social care services is set to increase significantly in the coming decades.

At present Social Care in England is funded through a combination of government funds allocated to local authorities, council tax revenues, individual’s contributions to their council care package and independently paid care.

The current system of Local Authority funding involves first an assessment of needs to determine the level and type of dependency of an individual. All Local Authorities have their own budget for adult social care needs and they decide which of the four needs bands they will fund. Anyone below a Local Authority’s needs eligibility threshold must pay for their own care.

If an adult is eligible to receive social care, they must next undergo a means-testing to determine how much they will be expected to contribute to the cost of their care. An individual with assets of more than £23,250.00 receives no public financial support. The value of an individual’s home is included in the means test unless a spouse/partner continues to live there. It is estimated that an individual who has means above the threshold and has substantial care needs will utilise 90% of their personal wealth.

The current government set up a commission on funding of care and support lead by Andrew Dilnot. The main recommendations of this commission were incorporated into the Care Bill and include capping lifetime contributions to care at £72,000, increasing the wealth threshold from £23,250 to £118,000, setting up a national system of needs assessment eligibility and creating a system where an individual may only be required to utilise 30% of his/her assets on care as opposed to the current 90%.

The Care Bill is currently at the Committee Stage in the House of Commons and although the reforms proposed are welcomed as a step in the right direction, the following concerns have been raised.

  1. The increase in the upper financial threshold to £118,000 will result in an estimated 100,000 additional older people qualifying for funding. However, as the Care Bill proposes to bring an end to the “postcode lottery” of eligibility criteria there will be an introduction of a standardised assessment of whether an individuals needs qualify them for support. There are fears that the new “bar” will be set too high potentially resulting in over 130,000 people currently receiving council – funded support being left to fend for themselves.
  2. The cap on care costs being introduced in the Care Bill will primarily protect wealthier families’ inheritances but will not stop many ordinary older people having to sell their homes to pay for care. The national charity United for all Ages has advocated scrapping the cap and introducing a new funding system based on taxation that would be fairer and simpler. They believe that tax funding has to be the basis for a care system that delivers quality care for the growing number of older people who need it.
  3. The proposals to cap care costs will not help older people until at least 2021 and even then the majority of care home residents will not benefit from the cap because older people will have to live in a care home for five years before reaching the £72,000 cap but the average residence in a care home is only 2 years.
  4. The Care Bill doesn’t deal with the current underfunding of care fees paid by Local Authorities. It will merely increase those eligible to receive funding thus exacerbating the situation.
  5. The bill for adult social care for those over 65 in the UK in 2012/2013 was £8.9bn compared to £8.8bn the year before – a decrease in both cash and real terms. No major increase is proposed in the Bill.

In conclusion, if implemented, the Care Bill will potentially make the care funding system even more complicated and will not provide the extra resources needed to support our ageing population.