Managing the Rising Cost of Elderly Care

elderly care

Since the economic downturn of 2008, the major parties in government during that time have had to deal with a difficult problem: the cost of elderly care. Somehow, someway, government, the NHS and councils are having to find new ways of meeting these costs. The total cost of elderly care to government (including local authorities) as around £23bn every year. That number is only going to get higher. That’s why various charities, government departments and research organisations have made some suggestions for future funding.

A Large Problem Simplified

Both Labour under Tony Blair and the Conservatives under David Cameron and then Theresa May have promised to look at the issue. Little progress has been made in over 20 years.

Successive governments have tended to group people requiring elderly care into two broad camps: those entitled to assistance from the local authority (a group that is getting smaller), and those who are not. Those who do still get help feel it is not enough and not as much as they used to get, or their elderly parents used to receive. That leaves a big black hole and families are expected to help while the people getting help are expected to use savings and assets to fund it in some cases.

  • 21% get help from their local authority
  • 5% rely on family and friends for their care needs
  • 30% get little or no help
  • 5% are paying for professional assistance, either as home helps or in residential care

The figure for those paying for help is around £30,000 on average. Some will even sell their homes or move into smaller accommodation to free equity to pay for it. Age UK has advised many people about their entitlements and what they may need to spend.

What are the Potential Solutions?

Almost nobody is happy. Even those who feel that richer older people should pay for their care realise how problematic the current system presently is. Contrary to popular belief, the National Insurance system is not a pot from which a person will withdraw funds when they need it in the form of sick pay, unemployment benefit, pension and care. People presently working and paying into the system are paying for this generation of retirees. Today’s retirees paid for the last generation and so on.

  • The Social Market Foundation recently suggested that wealthier retirees (those with assets over £150,000) should be charged a one-off fee, possibly after their death, to pay for the increasing cost of elderly care
  • Health Secretary Matt Hancock has expressed interest in a pension system similar to National Insurance as a pot for funding elderly care, paid for by richer retirees to help poorer older people
  • This has also interested cash-strapped NHS chiefs who also feel that those owning high value homes and who can afford to pay for their care, should pay so that others who need it and can’t afford it, are able to enjoy healthcare based on their needs

While disabled and people with chronic health conditions can get VAT relief on mobility aids and home improvements, it is still a struggle for many people to afford good mobility solutions.

 

Will Harrison

Will Harrison is the founder and managing director of CareCo. He has worked in the mobility industry his entire life and grown CareCo from a grass roots business in his family home to the UK's leading mobility retailer with nationwide mobility showrooms and operating in the global market.