The government announced last week that it will defer the capping of care costs until 2020. This will grant providers and local authorities a much needed break following five years of substantial cuts under the coalition. Following recommendations from the Dilnot Commission in 2011, plans were in place to put a £72,000 cap on the care liabilities of individuals, after which local councils will be responsible for the costs incurred. Under the government’s original timeline, the Act was due to come into force in April 2016.
Capping residential care costs for individuals is undoubtedly a noble aim, and stories about the vulnerable being struck with enormous bills and having to sell off assets are of course awful. But a cap is currently not feasible given the state of councils’ finances. Councils are already unable to provide their constituents with enough care, funding for all but the most acute cases has been cut, both of which will only get worse as Britain becomes increasingly elderly.
Local authorities are already having to make extremely difficult decisions when it comes to care provision, with Nottingham City Councilannouncing this week that it is now unable to subsidise the cost of travel to day-centres. This illustrates how constituents’ often end up being passed the bill for shortfalls in care funding, with people in the city facing a 140% mark-up in their costs.
Figures from local authority leaders suggest that the cost of capping care costs would have been staggering in both the short and long term. In its first year alone the cap would have cost an estimated £590 million. By using the money that would have been spent on the cap to fund day-to-day social care, policymakers have improved the sector’s financial wellbeing in the short-term; one estimate suggests that councils will save £3bn between now and 2030.
In the long-term, it is unlikely that the Care Act’s reforms will be pushed back any further than 2020. Policymakers should therefore look to reducing how significant the social care burden is on the public purse or alternative sources of funds. Greater investment in homecare would also be a significant step in the right direction. Homecare is far cheaper alternative to residential care, and this will be of massive benefit to the general public when the cap is inevitably brought in.