Brown pledge on care costs

benood

Dithering_Dad wrote: »

Please answer me this - why should my council tax keep going up in order to pay for you to get an inheritance?

Why should my council tax keep going up to pay for profligate OAP's who fail to plan for their old age? I'm not quite sure why you personalise your response DD - I'd be extremely surprised if your council tax ever subsidises me to any degree whatsover.

But back to your question - my answer is that when those affected by this ruling were buying their houses they were seduced by politicians talk of "wealth cascading down the generations" etc, this scheme makes for a lottery and creates a real disincentive to creat wealth at the margins. Like so many of the government's policies it has the effect of encouraging people to become dependent upon state largesse while discouraging self reliance - great if you think that communism works, I'm of the opinion it didn't.

treliac

Like so many of the government's policies it has the effect of encouraging people to become dependent upon state largesse while discouraging self reliance

Absolutely.

Why bother to spend 50 years grinding away at work you don't enjoy, with little or no prospect of either improving working conditions or pay but always fearful of the threat of redundancy.

Why suffer the loss of role that goes hand in hand with having to give the responsibility for bringing up your children to others and the worry of not being able to be there for them at many important times of their growing up.

Why give up holidays and struggle to pay for little extras in life so that it's possible to pay the crippling mortgage costs on a fairly small and basic house that will provide a home for you and your two children (making sure not to have another that would be unplanned and unaffordable).

Why indeed do any of these things or make the multitude of sacrifices that are made in order to be responsible and as self-reliant as possible. Especially when, having done all of this you will end up paying to be in the next bed, in the same home as the person who 'allowed' the state to look after them all their life and is having their end of life care fully state funded as well. Because don't think that residential care is segregated in any way other than the way it is paid for.

When I look at it like this I might well wonder why I chose the first route. The only answer I have is that this was the ethic instilled in me as I grew up.

Undeniably, the soaring costs of caring for the elderly and disabled are not going to met without considerable pain from the tax paying public. As ever, it will be the honest and the willing who will bear these costs. No government seems able to bring pressure on the unwilling to take reasonable responsibility for themselves.

And, furthermore, when the various philosophical approaches to these matters are discussed, we all take our own particular stance which is usually governed by our own experience, self-interest and set of moral values. We frame our beliefs and our argument accordingly.

bigturnip

The lines between socialism and conservatism seem somewhat blurred on this issue, remind me who's on which side again?

Dithering_Dad

benood wrote: »

Why should my council tax keep going up to pay for profligate OAP's who fail to plan for their old age? I'm not quite sure why you personalise your response DD - I'd be extremely surprised if your council tax ever subsidises me to any degree whatsover.

Sorry, that's just my Northern dialect coming through, when I say "you" I mean 'anyone'. I tend to slip into this I've noticed and it gets me into trouble. I would have used the "Why should Your council tax be used to subsidise MY inheritance - but then that doesn't really fit either because I'm encouraging my folks to spend their money on themselves.

How about: "Why should our council tax be spend subsidising other people's inheritance?". There we go

Dithering_Dad

EdInvestor wrote: »

It's not actually 100% clear that at the lower cost level there is any real difference between the standard of care given to the council funded and the self funded - except of course that the self funded people pay higher fees than the council residents in the next room (or bed), another source of anger..

Citation please... I always back up my quotes with facts (i.e. the Help the Aged links), so I appreciate it if others do the same. Thanxs.

EdInvestor wrote: »

They would both have to contribute to their care from their pensions. The house(s) would be disregarded if their is a spouse (and other qualified people) in residence...

If the house is disregarded then as long as their annual pension is below the 22k threshold then they won't have to pay. Surely with a +22k a year pension you can afford to pay for your old folks home? The alternative is that the pensioner keeps their 22k and others pick up the tab - many of which are on nowhere near 22k a year!

EdInvestor wrote: »

I agree with your view that taxpayers should not fund people's inheritances.On the other hand I don't agree that some people's entire wealth can be wiped out in a few years of ill health while others will barely notice the effect.

Are you saying that these old folk have a few years of ill health, move into an old folks home, then "get better" and want to leave and go back home. I'd be very surprised if that scenario played out very often - perhaps it will when we find a cure for old age? Short-term illness is covered by the rules already in place.

EdInvestor wrote: »

There are various ways of reforming the issue:
-raise the threshold of assets that can be disregarded - 22k is derisory
-cap the cost, so beyond a certain level the state picks up the tab
-enforce the existing law on nursing care and Alzheimers patients ( this would meant the problem would almost disappear overnight)
- increase the tax breaks for self funders

This is only an issue because people want their inheritance. If inheritance was not allowed, everyone would think it was perfectly acceptable that if people are sheltered, provided with cooked food, heating, electricity, etc. then they should pay for it. If my parents decide they would like to live in a hotel in Cornwall, should their accomodation be paid for by the taxpayer because otherwise they'd have to sell my inheritance (their house) in order to pay for it?

People in the UK are so property mad that it blinkers them to the wider picture. If an individual had a £300k pension pot paying a large annual pension and lived in rented accomodation - I suspect there would be zero outcry if he moved to an old folks home and had to foot the bill. "Well, he was already paying rent anyway and look at that pension income! Rich sod, he can well afford it!".

There would be a very great outcry if that same individual had no pension but owned a 300k house outright and had to sell it to release capital to pay for his old folks home. The net assets are the same, the difference is that relatives can get their hands on a house and not on a pension!

benood

Dithering_Dad wrote: »

Citation please... I always back up my quotes with facts (i.e. the Help the Aged links), so I appreciate it if others do the same. Thanxs.

http://news.bbc.co.uk/1/hi/uk/6220716.stm - this story appears to say that conditions in private homes are allowed to be worse than in council homes - although the individual in question was council funded.

Typical care home fees seem to run at about £25k per year (allowing for inflation since 2002: //www.guardian.co.uk/society/2002/mar/23/longtermcare.housinginretirement2

I can't think of a workable system any better than what's there at the moment, dreadful as it is - if you're on the margins of the benefit system you're probably best off concentrating on working it to your advantage, doh!

EdInvestor

To clarify when you need care, your income and assets get assessed.If the council is paying any of the cost you will be expected to contriubute all your pension except a small allowance of around 20 quid a week.If you have assets of more than 20k, you are expected to use them to pay the care until they are exhausted. If you have a spouse living in the family home, the value of the house will be disregarded. Even if you are self-funding you are advised to have this assessment so as to find out if the council will pay for your care in the same home if(when in many cases) you run out of money.The council has a duty not to overspend the taxpayer's money so you may well be told you will have to move to a cheaper home when the money runs out, which is why there is some doubt if the self funders get any value for their money at the bottom end. [Note: it is very wise to have assets and income split between spouses, otherwise if you need care and have a large pension and your wife has only a small one, you may find all your pension gets snaffled to pay care costs, leaving your wife on the breadline.]

If seriously interested in this issue there are many threads covering the details, with links, in the "Silver Savers" forum where it's usually discussed.

If the house is disregarded then as long as their annual pension is below the 22k threshold then they won't have to pay. Surely with a +22k a year pension you can afford to pay for your old folks home? The alternative is that the pensioner keeps their 22k and others pick up the tab - many of which are on nowhere near 22k a year!

Perhaps you have misunderstood the situation, see above?

Are you saying that these old folk have a few years of ill health, move into an old folks home, then "get better" and want to leave and go back home.

No.

If my parents decide they would like to live in a hotel in Cornwall, should their accomodation be paid for by the taxpayer because otherwise they'd have to sell my inheritance (their house) in order to pay for it?

You don't usually have a choice when it comes to going into care.

Dithering_Dad

The age concern website seems to be a really good repository for information, so I'd advise anyone to go there first. Discussion forums are OK but their content is often inaccurate (either accidently or deliberately if the person is pushing political views). Here is a link to a PDF file that covers everything to do with Care Home funding (taken from Age Concern):

Care Home Funding

Interestingly, if you are taken into care for health reasons, the entire cost is borne by the NHS.

I still believe that if you can afford it, then you should pay towards your care home. I learned that Ed was quite correct and all your income is taken to fund the home, apart from £21 per week.

This has just strengthened my view that house equity should be factored into any asset calculations. Many people plough all of their money into their property and give little or no thought to a pension. Others have more modest homes but larger pension - why should these be penalised by having the pension income taken, while the householder with no pension is allowed a free ride from the tax payer, while giving away his assets to his children?

Very interesting debate though.

baby_boomer

Nice soundbite by Brown in the direction of Middle England.

He just forgot to mention that Middle England would have to pay for it .

EdInvestor

Dithering_Dad wrote: »

This has just strengthened my view that house equity should be factored into any asset calculations. Many people plough all of their money into their property and give little or no thought to a pension. Others have more modest homes but larger pension - why should these be penalised by having the pension income taken, while the householder with no pension is allowed a free ride from the tax payer, while giving away his assets to his children?

Agreed, the system is not structured fairly at present.

Quick upsummer of the way it works here:
Fool article


Further useful detailed info about financing care here:

https://www.hsbcpensions.co.uk/nhfa/pdfs/is6.pdf

About 70% of the people needing care have a variant of dementia. According to a recent court judgment, most of these people should be paid for wholly by the NHS, but the Government is weaselling out of its responsibilities.

It seems from an article in the Guardian that the Government is going to try to get the insurance industry to structure a product based on a portion of home equity which would act like a care annuity. Kind of equity release with a twist.

To my mind it is fair that people pay towards the accommodation aspect of residential care, as this replaces their home and they have to live somewhere. It's the medical treatment and personal care that should be funded by the Government, as it is in Scotland, possibly through a big increase in Attendance Allowance/NHS allowances.The Govt also needs to look at a way of capping or regulating the rises in nursing home fees, which have been massive in recent years

It's also worth noting that not many people actually need care - as mentioned it's primarily the victims of dementia or massive strokes or the very, very old (95+).IIRC the numbers are around 6% of the over-60 population. The day they find a way to stop dementia, cure it, or even dramatically slow its progress, much of the problem will go away.