This is another piece of arcanery, I am afraid, for the House. It is a genuinely probing amendment.
Not everyone may know what top-ups are, any more than everyone knows what nursing care allowances are. They arise for people who are not paying in full for their own care but want a better standard of care than the local authority is prepared to pay for. There are a quite a lot of these people. There are about 350,000 people in care homes and about 50,000-plus of them get care allowance. If a local authority claims a person’s needs can be met in a home costing £400 a
week and the old person or their family prefers one costing £500 a week, they get the means-tested support as if they were in a £400-a-week home and the family finds £100 from their own pockets.
However, there is a strange twist. As long as a third party—usually the old person’s family—is prepared to dip into their pockets for the extra £100, there is no legal problem. They can do so under LAC circular (2004) 20, which derives from the National Assistance Act 1948. But if the old person wants better care, they can top up out of their own pocket only in very limited circumstances. They can do so only if they are subject to the 12-week disregard—which is the period you can be in a care home to see whether you get better and come out—or if they have a deferred payment agreement with the council, when the council may make top-up payments on their behalf. In theory, people cannot top up their own home fees but these can be topped up by other people.
As a historian of the Treasury, I can sort of see how this might come about. The Treasury would not want those whose means-tested contribution is offset by the tariff, as has been discussed, running down their assets to pay for better care, thus throwing more of the burden on the state. However, those in the know say that the restriction is widely ignored, often with the connivance of councils that do not want to get into an argument about whether the accommodation they will provide within their own limits is adequate for the old person. As a result, they allow the old person to chip in for their own care—perhaps he or she puts the money into a son’s bank account, the bank account pays the home and we do not know what goes on.
In parentheses, it is perfectly clear that local authorities know very little about what is going on with top-ups. I refer to the report due to be published by the charity Independent Age tomorrow, which analysed this after doing a freedom of information request on all councils. Out of the councils they asked, only 30 or so can be reckoned to have best practice or a good system for keeping account of top-ups. The rest are either bad or worse.
These mysterious top-ups go on, otherwise the old people would have to move out of the home they are in and into a local authority home. As noble Lords know, if you move old people from the home they are in to another home, what frequently happens, I am afraid, is that they die. This strange top-up mess is more difficult in the post-Dilnot world. Because of the extension of the asset limit for means tests, many more people will be receiving means-tested support, and anyone who is receiving means-tested support cannot do a top-up; that is the law. Many more people will therefore find themselves limited in what they can do if they stick by the law—which, as I say, they often do not.
Secondly, because the deferred payments scheme will be made available to everybody, more people will escape through the loophole in the current regulations that allows those on deferred payments to top up—you can do it if you have a deferred loan from the local authority but you cannot if you do not. The injustice between those who can and do defer and those who do not is made worse—the former can top up but the
latter cannot. That will be a growing problem and a huge incentive for people to take out deferred payments, because they can legally top themselves up that way.
Thirdly, and potentially more importantly, let us suppose a person is self-funding and in a home where the fee exceeds what the local authority will pay. They reach the cap, having spent their £72,000. What will happen then? The state will meet that part of the cost of the home that they are in which is equivalent to what they would pay if they were in the home selected and provided by the local authority—their limit. If the home costs more than that—£600 a week not £400—where will the rest of the fees come from? Perhaps their family does not have any money for a top-up or is unwilling to provide it. Who is going to top it up? I am afraid that the crude reality is that some people will persuade the council to pay the higher fee while others will be moved—and, as I have already said, people who are moved will as a result, on average, die considerably younger. That is not a side-effect that Dilnot planned for but it is a side-effect of the way it is going to work out. Nothing much has been said by the Government about what happens if you reach the £72,000 cap and are in a home costing more than the local authority is prepared to pay. Until we get reassurances on that, the reality must be that they will be moved out to another, poorer, home and that this is going to be a tragedy.
The irony is that these are not poor people falling back on the state. They may well have assets and might be very willing to put in a bit extra to ensure that their last years are comfortable, but they are prevented by law—if they obey it—from doing so. Either they decide to opt out of Dilnot and fund their care in full, in which case they will not benefit from the cap and Dilnot, for them, amounts to nothing, or they go through the business of moving to the inferior home and we will have inflicted that disaster on them.
This area has not been much explored but there is a simple way of dealing with it, which is incorporated in this amendment. It is simply to end the ban on residents topping up their own fees. I do not think the cost would be very much but if the Minister has some other way of dealing with it, he should tell the Committee now before we endorse a policy which could lead to the mass eviction of old people from the residential homes in which they have long lived, in sharp contravention of all we are aiming to do in this Bill. I beg to move.