So what now for Social Care?
The Queen’s speech on 21st June remained silent on the issue of Social Care and the reforms proposed in the Conservative manifesto in the run up to the snap election earlier this month.
As widely publicised, the Care Act 2014 introduced a cap on the amount that individuals would have to pay towards their care. The cap of £72,000 was originally due to come into effect in April 2016 but was deferred until 2020 by the government. This is essentially due to lack of funding; the local authorities simply cannot afford to put more into paying for care.
In the run up to the snap election the Conservatives proposed a new funding floor (as opposed to a cap) which would mean individuals would have to fund their care down to the last £100,000 including the value of their home. Whilst at first glance this may seem attractive (as the current limit is £14,250 before care is fully funded) it should be remembered that in some circumstances an individual’s home is disregarded in calculating financial assets, for example, if a spouse remains living in the property. In addition, the provisions of the Care Act are intended to remove potentially catastrophic care costs by placing a ceiling on the amount any individual would have to pay. Replacing that ceiling with a floor would mean wealthier clients in particular could see large sums being used to pay for care before they reached the proposed £100,000.
Following public outcry Theresa May did state that there would be a cap to care costs as well as the proposed floor, however, no further details have been revealed. The Queen’s speech simply stated “My ministers will work to improve social care and will bring forward proposals for consultation.”
For those in care, or that may need care within the next few years, the extent to which costs will have to be met through personal funds remains uncertain. The care system remains stretched and costs are likely to increase.
For those with means to fund their care there are a number of options open. Seeking professional advice can help avoid costly mistakes and could make the difference between funds lasting throughout lifetime and funds becoming depleted, which will often result in reduced care options later in life.
If you would like to know more about how we as Financial Advisers can help you with your or a loved one’s Long Term Care needs and general latter life planning then visit the Later Life Planning section of our website: Later Life Planning or send us email at: [email protected]
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