Dilnot Report - Dignity for the elderly

Andrew Dilnot at the launch 4 July 2011The Dilnot Commission published its report proposing changes in care for the elderly this week.  The Dilnot Commission, chaired by Andrew Dilnot, includes such heavyweights as Lord Norman Warner (who also chaired the Ambulance Review which I contributed to) and Dame Jo Williams.  So it has been carefully thought through and almost certainly represents the best of thinking on the subject.

So what does the report say and why is it so dramatic?

Among the recommendations in the report are:

 

  • Individuals’ lifetime contributions towards their social care costs – which are currently potentially unlimited – should be capped. After the cap is reached, individuals would be eligible for full state support. This cap should be between £25,000 and £50,000. We consider that £35,000 is the most appropriate and fair figure;
  • The means-tested threshold, above which people are liable for their full care costs, should be increased from £23,250 to £100,000;
  • National eligibility criteria and portable assessments should be introduced to ensure greater consistency; and
  • All those who enter adulthood with a care and support need should be eligible for free state support immediately rather than being subjected to a means test.

The Commission estimates that its proposals – based on a cap of £35,000 – would cost the State around £1.7billion.

It makes interesting reading, because it is principles driven, rather than driven by political expediency.  Those nearing retirement won't have to live in fear that they will lose everything should they need care (current costs often mean they have to sell their house) or that they have to transfer all of their assets to sons or daughters before the dreaded moment of need comes up (and sons and daughters aren't always as sympathetic as we'd like to think).

But different people interpret this document in different ways, and it will succeed or fail based on how it is interpreted.

The politician's response

The elderly not only vote more often, but are more likely to change their vote according to the policies put forwards. They are the least likely to be purely selfish, wanting policies that benefit their children and grand-children rather than purely themselves.  Politicians watch out.  I predict that no-one will oppose this report (though the devil will be in the detail - where does the predicted £1.7billion come from).

So politicians will go out of their way to show how "grey friendly" they are, but jump onto the next bandwagon at the earliest opportunity

The Banker's response

Bankers and finance experts are already crawling all over the report examining how they can sell policies to "protect yourself in your old age", because suddenly all of the risk is taken out of it.  Expect a slew of new insurance instruments which promise to pay up to the capping level, but with fees that don't really reflect the reduced risk (in other words, the bankers will take advantage of everyone's confusion to increase their fees)

The Socialist's response

Socialists have already responded - this benefits the rich and the children of the rich, and leaves the poor where they were before. But £100,000 is not a lot of assets, and £35000 was only relevant to people who actually had nothing at all (rented accommodation, no savings).  I'm back on my hobby horse - how come so many of the self-styled "working class" don't do any work; there are plenty of people like me who don't have capital (can't make money out of the assets we have) so could hardly be called capitalist, but who would like to be able to pass something on to our children

The Son or daughter's response

a mixed reaction.  On the one hand, it means that they will get more of their inheritance because it won't be taken by the state to provide care.  On the other hand, there's no longer a compelling reason to transfer the assets to them straight away.

Amidst all this cynicism, is it good for anyone?

Yes, for many people it gives them the hope of getting old with dignity.  Many want to be able to pay their way, as they have done all of their life.  But they don't want the cost of paying their way to exceed their ability to pay.  This seems an excellent compromise!

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