My Lords, I rise to speak to Amendment 235 in my name, which seeks to implement the social care contribution cap recommended in the 2011 Dilnot report. He recommended that a cap be set at £35,000. Care cost inflation runs at 1.5% above the consumer price index, so to replicate the 2011 recommendation, adjusting for this cap would now be set at £50,000, and that is what this amendment seeks to achieve. The amendment would also adjust the cap with care cost inflation each year.
I first want to acknowledge that the Government’s proposed cap in this Bill of £86,000 is a significant improvement, as it introduces a cap and puts some limit on what people pay in care costs. There are some who still do not believe that there should be a cap and feel that this will just be a means of helping wealthy homeowners, but not all homeowners are automatically wealthy or sitting on some high-value property portfolio. For many people, as we know, their only real asset is a modest family home, which, in certain parts of the country, may have increased in value over time but even so not enough to make them wealthy.
There is an equity issue in that, if someone is diagnosed with cancer, the NHS will cover the full treatment cost, whereas if someone is diagnosed with dementia, they may require many years of care, which will cost families thousands of pounds as this is not covered. My Amendment 291, which will be debated in a later group, addresses the issue of dementia care
plans and specifically talks about the different types of dementia and how each requires a different type of care and support. If someone is unlucky enough to be diagnosed with a certain type of vascular dementia, Lewy body dementia, or Parkinson’s-related dementia, these conditions often require many years of care—up to a decade or more in some cases.
I am not suggesting that there should be a different cap for people who have been diagnosed with long-lasting forms of dementia, but we must understand that people with these types of dementia will be the most impacted by this provision. The proposed cap of £50,000 in this amendment, the equivalent to that recommended in the Dilnot report nearly 11 years ago, is a much better one. According to the ONS, the average yearly earnings for people in the UK is £31,000. The cap of £50,000 is roughly just under two years’ average earnings, whereas £86,000 is nearly three years’ average earnings.
I anticipate that, when the Minister responds, the main objection to this amendment will be the cost to the Government, and I have no doubt that the Treasury will have concerns if the cap is lowered. In response to this, I refer the House to the debate in this Chamber on 16 September 2021 on the Intergenerational Fairness Forum report, Grasping the Nettle. As chair of the Intergenerational Fairness Forum, I introduced this debate, outlining that the report recommended that the Government introduce a social care levy at a rate of 1%, which could be raised to 2% for those aged 50 and over if there were a need for extra revenue. The levy would apply only to adults over the age of 40, placing the heaviest burden on those best placed to contribute to the cost of this bill. I mention the recommendation from this report to highlight that there are still other options to fund social care, and it would mean that the Government could lower the cap.
Some will feel that it is better at this time to focus on implementing the current cap and then, over time, press for a lower cap. Certainly, history shows that when other social security measures, such as the pension, were first introduced, they started at quite a small amount of money but then became more generous over time. I accept the logic of this, but still feel that the case must be made for a lower cap and that this should be considered and debated in Committee.