The middle England issue: Report aims to fix elderly care

By Ian Dunt

Those who lose their assets to pay for social care may be protected if the government accepts the findings of a major report into the issue today.

Andrew Dilnot's report on elderly care argues that spending on people's care costs should be capped at £35,000, although it accepts any level between £25,000 and £50,000.

Together with a higher means-tested threshold the plans would ensure that no-one spends over 30% of their assets on care costs.

"There's a widespread feeling the care system we have in Britain doesn't work. It's unfair, people don't understand it – they want change," he said.

"We think this is an area people should be celebrating – celebrating the fact people are living longer. We haven't had a system that does work. We're proposing one that will."

Critics of the scheme suggest that this is not an ideal moment to go to the Treasury requesting funding. The proposals would cost somewhere in the region of the projected savings from public sector pensions.

If elderly care costs were capped at £50,000 it would cost the government £1.3 billion, while a £25,000 cap would come in at £2.2 billion.

Analysts expect the Treasury's objections to be tempered by the fact that social care relates so directly to middle England.

Middle-earners are the hardest hit by the current arrangements, as they risk losing 84% of their assets of spending around £150,000 on care costs.

That makes action on social care exceedingly good politics, a fact which will not escape George Osborne in his dual role as chancellor and Tory election strategists.

It has also prompted Ed Miliband to enter the fray. The Labour leader has promised to put Labour policy aside for a new start on the issue, including three way cross-party talks.

Downing Street released an ambiguous statement about the report, saying its funding implications could not "be looked at in isolation".

"This whole area is complex, as well as multi-faceted," a spokesperson said.

"We have always said there is a price tag, but we are not going to back away from the issue."

For Labour, shadow health secretary John Healey said any plans had to be affordable.

"The point about Andrew Dilnot's report is it doesn't duck the fact that we are all going to have to pay in some way that bit much more," he said.

"We're going to have to put a bit more aside for our own retirement and how we do that has to be fair, it has to be affordable."

The last time all three parties debated the issue the Conservatives stormed out of talks and mounted a high-profile poster campaign criticising Labour's 'death tax'.

The issue is likely to become more politically potent as time goes on. The number of people aged 85 and over in England alone is expected to double to 2.4 million before 2030.