Funding of Care and Support

Baroness Barker Excerpts

Thursday 24th November 2011 Lords Chamber

[Baroness Barker]

My Lords, I thank the noble Baroness, Lady Pitkeathley, not only for the characteristically thorough way in which she introduced the debate but for securing it in the first place. She is absolutely right that the timing is of the essence. Many noble Lords have buried themselves deep in the Health and Social Care Bill. I was going to observe that perhaps today was light relief for some of us—but it is not. Everything that we will discuss today has an impact on the National Health Service. We have known for so long—and it has been confirmed by every report that the noble Baroness talked about—that if we do not sort out the system of social care, which we know does not work, it will inevitably build up costs for the National Health Service. As ever, it is a great shame that while people are passionately vocal about changes in the NHS, there has been something of a silence on social care, which never gets the same level of reaction despite being so important.

I will not go into great details on the reports. I will focus for my seven minutes on things that have to happen now. It is clear that the public know that they are likely at some point to need social care. However, they do not know the likelihood of that happening to them. We know that for people aged 85 and over, of whom there are a growing number, the figure is three out of four. According to an ABI survey, 51 per cent of the public do not know who will pay for their care; 21 per cent think that their family might pay for it; and 19 per cent think that the Government might pay for it. They have no idea where to go for independent advice. Those are the key issues that we must work around.

We must recognise that this is a generational issue. One’s ability to afford social care depends entirely on whether one has property. That is the determining factor. There is also an age factor. People aged 85 and over at the moment will have to pay for social care from their savings or capital. Those who are 65-plus and already retired will have to try to secure an annuity. As we know, the private market so far has failed to develop appropriate products. People of working age who want to plan for their future social care needs will either have to come to some kind of annuity arrangement or hope that in future insurance products will be made available.

As the noble Baroness, Lady Pitkeathley, said, it is crucial that politicians come together now to agree which parts of the Dilnot report they will accept, and the criteria and level of funding, so that individuals can know with some degree of certainty what the likely state contribution to their care will be, and private companies can come up with forms of insurance that are sustainable. That will take considerable time and is an urgent matter.

The noble Baroness, Lady Pitkeathley, mentioned in passing the Law Commission. She is absolutely right. The Law Commission report is critical to this. It calls for two things: a new statute and regulations that set out community care criteria and eligibility, and the process of assessment for individuals. The importance of community care assessment is something that people in the world of community care understand, but nobody outside it does. It is fundamental to this issue. If individuals cannot tell at what point their care needs will be recognised, accessed and taken forward, we cannot begin to build insurance products that will help people to plug the funding gap.

I will make a further point that has not come out in either of the documents. It is crucial that there is a system of care assessment that runs alongside but is completely independent from any form of financial assessment. In future, people will have to undergo both processes, but one must not contaminate the other.

I mentioned property. It is inevitable, given the generational distribution of property ownership, that equity release and the ability of individuals to release resources that are tied up in capital will become increasingly important. At the moment we do not have equity release products that are deemed to be safe. Nobody who wishes to go down the route of funding their own care in that way knows where to go for reliable advice. I ask the Minister whether the work done on equity release by the Joseph Rowntree Foundation in 2006 is being revisited, and whether the Government are engaging with the FSA on how they might build an equity release market in future that people will be able to trust.

Members of your Lordships' House conducted a seminar in which Andrew Dilnot introduced his report. He spoke to a pretty tough crowd. One political point was raised by the noble Lord, Lord Campbell-Savours, who is not in his place. He challenged Andrew Dilnot on whether his report was not a subsidy to people who were well off. That is the outstanding political point. Andrew Dilnot made the fair rebuttal that healthcare in the NHS is a system of pooled risk and we do not draw the distinction. That is the only substantive political point that was raised against the Dilnot report. I hope that if the noble Lord, Lord Campbell-Savours, agrees that the system that has been devised is equitable across the piece, all parties should be able to agree.

We have been here before. We have been very close to reaching agreement. Some weeks ago Ed Miliband said that he would be willing to take part in cross-party discussions. It is very easy to make such a statement and then find some reason, process or proposal that you cannot agree with. This requires political consensus and courage from all parties. It will take a degree of sustaining. It requires all politicians to convince the media that this is the correct way forward. If we do not agree this now, we will be back in 20 years debating the same issues, and the situation will be worse for the individuals concerned.

--- Later in debate ---

[Baroness Thornton]

My Lords, I thank my noble friend Lady Pitkeathley for initiating this debate and pay tribute to Andrew Dilnot and his colleagues, including my noble friend Lord Warner, for the report which they produced in July this year. I am sorry that no Conservative Members on the Benches opposite are present to take part in this debate because the band of “usual suspects” to which reference has been made includes members of the Conservative Party. Their voices have been missed in this debate.

I am grateful to all noble Lords who have taken part in the debate for their insights. We felt that it was important that those on these Benches should initiate this debate as we seem to be at a standstill, or making slow progress, on many social care fronts, and in some areas are possibly moving backwards. That is a matter of grave concern. I echo the final words of my noble friend Lord Warner that we cannot afford not to do anything.

We can all agree that the need to secure a sustainable funding settlement for social care has never been more urgent, with local government and NHS finances under significant pressure and demand for services increasing as the population ages. We all agree that the NHS will never work properly without a sustainable approach to social care funding. The Dilnot report therefore offers a credible and costed way forward. We believe that the Government must move quickly to undertake detailed work on the report’s recommendations and honour their pledge to publish a White Paper, followed by legislation in 2012.

The adoption of the capped cost framework recommended by Dilnot offers a fairer and more transparent way of sharing the costs of care between the individual and the state. This will make it easier to tackle the deeper problem of underfunding that has led to the tighter rationing of services and escalating levels of unmet need, which have also been mentioned by several noble Lords, including my noble friends Lord Lipsey and Lord Warner, and the noble Lord, Lord Sutherland.

The much mentioned budget deficit is no reason for delay. The questions of affordability go beyond the current economic situation, and the additional public spending needed to fund the proposals, as we have noted, is less than 0.25 per cent of GDP. The social care system is widely regarded as inadequate, unfair and unsustainable. Under the current means-testing arrangements, anyone with assets of more than £23,250 must pay the full cost of their care. This leaves one in 10 people over 65 facing costs of more than £100,000. Eligibility criteria for council-funded services have been tightened whereby in most areas only those with very high needs now qualify for help.

The squeeze on local authority budgets over the next four years will widen the gap between needs and resources, despite the additional £2 billion announced in the spending review and the best intentions of all local authorities to protect social care. As my noble friend Lord Warner mentioned, the King’s Fund estimates that a funding gap of at least £1.2 billion could open up by 2014 unless all councils can achieve unlikely and unprecedented efficiency savings.

In addition, only this week, the report of the EHRC, led by the noble Baroness, Lady Greengross, shone a light on the too often invisible experiences of older people receiving care at home. It reveals a service stretched to the limit and older people denied the dignity and respect they deserve. It is shameful and unacceptable for elderly people to be left for hours without food and drink and not properly cleaned.

We know that the Dilnot report called for the improved integration of health and social care. Evidence suggests that this can improve outcomes for individuals and deliver cost savings. We know all this, and we have been talking about it not only for the past 40 years but in the past few days during the proceedings on the Health and Social Care Bill. However, despite notable successes, the progress has been limited, with less than 5 per cent of NHS and social care budgets being subject to joint arrangements and wide variations across different parts of the country in the quality and achievement of joint working. Indeed, part of our scrutiny and testing of the Health and Social Care Bill is whether it will make that situation better or worse.

Nor should we forget that Dilnot did not claim to have the whole answer to the challenges that we face. He claimed that his report was part of the process and addresses very importantly, among other things than those I have mentioned, the injustices of portability of care assessments. The Government’s response to the Law Commission report is most important and was mentioned by my noble friend Lady Wilkins and the noble Lord, Lord Pearson of Rannoch. The Minister should be able to respond that progress is being made on this and other matters.

The proposals for carers are also important in the Dilnot report, as is the establishment of a national source of advice. The commission recommends that better advice should be complemented with a national awareness campaign on the cost of care and a new funding system. I look for that to be part of the Government’s response to this report. Indeed, the assessment and provision of services will be available using the same system as for older people, but the funding cap will work differently for younger adults and the report sets out how this might be achieved.

We must not forget that the need for timely, effective social care not only involves the long-term disabled, those in old age and people with long-term conditions. I thank Macmillan for its briefing and for reminding us that integration across health and social care is also vital in helping to meet the practical, emotional and financial needs of people living with cancer and those reaching the end of their lives. Macmillan welcomes the findings of the Dilnot commission, as it believes that the report also represents the foundation for a fairer funding system for social care.

I have mentioned all the things on which we agree, and I have done so quite deliberately. We all agree that we urgently need a long-term solution for the funding of social care, and that is why Labour offered cross-party talks on this issue from the outset. I urge the Government to get round the table so that we can tackle the care crisis and find a fair and sustainable solution for the future.

I hope that what I have to say now may help the scepticism of the noble Baroness, Lady Barker. Indeed, when I explain how we would like to proceed, I hope that she will nudge her own Government into conceding on this and making faster progress than they have done so far.

As the Minister will recall, when the Dilnot report was launched in early July, my right honourable friend the leader of the Labour Party welcomed it and offered cross-party talks on the future of social care, using the report of the Commission on Funding of Care and Support as a stepping stone to secure a better, fairer system of care for older people and the disabled. I understand that there was an exchange of letters in September and October, and most recently a letter to the Secretary of State dated 8 November.

There are some outstanding questions that the Government need to address in their commitment to this process, and I should be grateful if the Minister would indicate to the House whether progress on them has been made. There are four points. First, securing agreement on funding and implementing the Dilnot proposals clearly goes beyond the remit of the Department of Health and the Secretary of State for Health—it should involve all the departments affected. Given the public spending implications of both the Dilnot proposals and the rising costs and needs, the engagement of the Treasury in this process is crucial. Does the Minister agree with that, and is there agreement that that is how we need to proceed?

Secondly, the Government should nominate an independent person to chair the talks. Again, does the Minister agree with that, and when might it happen? Thirdly, we would like to see established an independent secretariat with the specialist expertise to provide equal access to the negotiations as required. Fourthly, there should be a party leaders’ meeting to agree a clear timetable to demonstrate that we are all equally and seriously committed to talks at the highest level.

Those commitments do not stand in the way of the process: rather, they will facilitate it. I put them on the record now, as they have been put to the Secretary of State for Health, and say that I think it would help the House and the process if the Minister would take the opportunity to respond on this matter. Finally, I thank all noble Lords for taking part in the debate.

[Baroness Barker]

I thank the noble Baroness very much—I did not know about the correspondence. However, can she explain why an independent chair is necessary for the process? I understand the other three points but I do not understand that one. What is the reason?

[Baroness Thornton]

We think that having an independent chair is a sensible way to move forward. We have not suggested that we should appoint the chair; we have asked the Government to suggest the name of the person who might chair those talks. I do not think that any of those things is a barrier to progress in this matter.

Finally, we on these Benches think that this is one of the most important issues facing our society today. It is one that we cannot neglect or leave in the long grass, and it is one that we are determined to resolve.