Wrong for sensible savers to subsidise the care of others
HOW often do we hear chancellors of the exchequer at budget time making encouraging noises about how we should all save more for our old age? How good it would be if public policy actually reflected what they tell us.
It is bad enough that care home residents who have taken the trouble to save throughout their lives and who are consequently made to pay their own fees should find themselves sitting alongside people who blew all their money and are now getting a free ride on the taxpayer. But far worse is the fact that self-funding residents in care homes are increasingly subsidising those whose fees are paid by the local authority.
A study by Age UK reveals that self-funders are paying an average of £200 a week more than those whose fees are paid for them. It isn’t that they are being served better quality crumpets for tea. They are paying more for exactly the same service. They are not just paying their own fees but subsidising other residents.
They are, in effect, being slapped with a huge tax of £10,000 a year. Self-funders have long paid a premium but the gap has grown alarmingly wider in recent years. Four years ago self-funders paid a premium of £40 per week. Now it is five times that.
What has happened is that councils have slashed their care budgets and used their financial muscle to push down the fees they pay to care homes, most of which are privately run. Rather than negotiate hard themselves, the care homes are taking the easy option and passing the cost on to a very soft target: elderly people who in many cases lack the mental awareness to realise what is going on and to complain.
OFTEN their financial affairs will be looked after by council social workers – the same people who are negotiating fees for council-funded residents.
Age UK has uncovered some appalling cases of treatment by care homes of self-funding residents. One 92-year-old woman had her fees jacked up by five per cent in April – and now the care home has demanded an extra £40 a week on top of that. Another resident with Alzheimer’s keeps being presented with extra charges for an “entertainer” even though she is unable to benefit from the service.
The family of a resident who moved out of a residential care home after three days because she was unhappy with the service was presented with a demand for four months’ fees. Another trick was to try to get a resident’s daughter to sign a contract saying she will be “jointly and severally liable” for all fees, which means that once the care home company had eaten its way through the resident’s savings it could start gobbling its way through her daughter’s savings as well.
If you are self-funding your place in a care home, you don’t get the same deal as someone whose place is funded by the council – you get a worse deal. A clause in the Health and Social Care Act 2008 makes care home operators liable under human rights legislation in cases where residents are funded by a public authority. The same does not apply to self-funded residents. If for example a care home decides to shunt a council-funded resident off to a different home for its own convenience, the council can sue on the resident’s behalf on the grounds that the resident’s right to respect for their private and family life has been breached. If it does the same with a selffunded resident, however, the resident has no recourse other than under ordinary contract law.
It is disgusting that selfreliance should be rewarded with such shoddy treatment. Where are the discrimination police, who are normally so keen to sniff out cases of unequal treatment, when it comes to the blatant discrimination of the care system towards people who have to pay their own way?
If you have more than £23,000 in savings – the level at which care home residents are made to pay their own fees, it is a licence for care home companies to rip you off and maltreat you. At the same time self-funded care home residents are being overcharged, the Government has delayed the introduction of a much-vaunted cap on care home fees. The cap, legislation for which is contained within the Care Act 2014, was supposed to be introduced this April but instead has been delayed until 2020.
Savers have suffered enough from ultra-low interest rates, which were only ever supposed to be an emergency measure following the banking crisis eight years ago.
BUT to reward people who have taken the trouble to save in the way they are being treated is unacceptable. Why can’t the Government slip into the Care Act a ban on homes levying greater charges on self-funded residents than on councilfunded ones?
At the same time, self-funded residents should be entitled to every bit as much protection under human rights laws as are council-funded ones. To have such a situation as exists now is itself a breach of human rights because it is open discrimination.
Old age care is never going to be cheap and with people living longer the bill is likely to rise. But the burden of funding old age care must at least be spread fairly, even if it means taxes having to rise. To pile the costs disproportionately on people who have been financially prudent throughout their lives is horribly wrong.
‘Burden of funding must be spread fairly’