We must all invest in a fund to pay for elderly care, says health chief

INSURANCE payments to cover the cost of care in old age could become “the norm” for everyone in England, the Health Secretary said yesterday.

Matt Hancock said the scheme could be modelled on the “auto-enrolment” system for workplace pensions, where every employee joins a company scheme unless they choose to opt out.

The idea is expected to be in an autumn consultation paper proposing ways to tackle the social care funding crisis.

Speaking on his way to an international summit in China, Mr Hancock said people should take more “personal responsibility” for their potential care needs.

Paying into a national fund would protect them from the “injustice” of massive care costs swallowing up life savings and forcing them to sell their homes, he said.

He added: “If you make it the norm, tell people what it is they have to do to look after themselves, it is often the case that very few people will opt out.”

Last year Theresa May’s general election plan to take assets after a person’s death to cover care costs was branded a “dementia tax” and seen as a key factor in the Tories losing their majority.

Former pensions minister Baroness Altmann said Mr Hancock’s idea could be helpful long term, as younger workers reached retirement, but would not solve the immediate care funding crisis.

She said: “Older people are already retired and will need care soonest. They will not have an employer to help them, so the model of auto-enrolment is less relevant. Other reforms will be required.”

The Local Government Association predicts a £3.5billion shortfall in care budgets by 2025.

Caroline Abrahams of Age UK said: “There is a lot to be said for us all ‘pooling the risk’ of developing expensive, longterm care needs. But you only get the benefits if everyone takes part, so the worry with an auto-enrolment approach is many people would choose to opt out.”

ALL ideas are welcome in the drive to find the way to solve Britain’s social care crisis. The Health Secretary Matt Hancock has suggested a scheme based on the “auto-enrolment” system of pensions which means people have to actively choose not to make payments. It’s an interesting idea and should be looked at carefully.

The immediate objection is that while it offers a potential solution in the long-term it is of little use in the short-term. It will not help those who have already stopped working. It will not avert the crisis that is happening right now.

This intractable problem is a hangover from the early days of the national insurance system. The 1942 Beveridge Report was primarily concerned with pensions. But now we must take account of elderly care too as a matter of urgency