Care crisis laid bare: 10 years to save the system


Owl cannot understand why the “team of experts” thought to have been appointed by Cllr. Christine Channon (and with unknown authority) have deemed the Budleigh Care Home – Shandford to be non-viable. Where is the evidence? 

Staff and residents of Shandford care home are still waiting for Simon Jupp to report on his meeting with Abbeyfield. Can he save the day?

Kate Palmer 


The death of final salary pensions, a shortage of council funding and nursing home fees of nearly £55,000 a year could cause the care system to collapse in a decade, a report has found. Analysis by the think tank the Centre for Economics and Business Research (CEBR), shown to The Sunday Times, has revealed an “imminent crisis” in elderly care, partly due to people saving too little…..

…..Over the next decade, nursing home costs will rise to an average of £54,375 a year and care homes will cost £39,124, research by the think tank suggests.

Added to this, people are living longer, with the average man aged 65 now expected to live for another 19.7 years, and the average woman of 65 likely to live until they are 87.

“We now know the elderly care system will collapse at the end of this decade,” said Kelly Greig, head of later life planning at Irwin Mitchell. “This is a stark warning of what is to come.”

She added: “More families are taking on unpaid labour to look after their elderly loved ones, and workers need to save unsustainable levels of money into their pensions just to afford care in later life.”

Governments have failed to take action on social care in recent years, and the long-awaited green paper setting out a shake-up of the system was put on hold indefinitely last autumn.

In the Queen’s speech in December, the government promised reforms so that “no one who needs care has to sell their home to pay for it”. Since 1999, an estimated 330,000 people have sold their family homes to fund the costs of care, according to a report by the charity Independent Age.

With the government already under pressure to outline its changes, last week it whipped up more concern with its proposal for a points-based immigration system. Care providers warned that the plan, designed to stop low-skilled labour from entering the country, would push up their staff costs and leave some homes short of workers.

A report by Care England this month said that councils were short-changing private care homes, paying them £10,000 less annually per resident than state-run homes.

Last week, Sunday Times Money revealed how people who had put away the maximum £1.055m lifetime allowance for pension savings would still be unable to generate enough income to afford annual care fees, even with their state pension included.

We also showed how restrictions on the annual amount that higher earners are allowed to save into their pension mean many will never get to that lifetime allowance….

…….Josie Dent, a senior economist at the CEBR, called on the government to increase its efforts to prevent the care crisis from reaching a “tipping point”.

She said: “Many more elderly people will find themselves using up their wealth or turning to local authorities for support to pay for care in the future.”

Councils are already struggling to meet the cost of this burden, however. The Local Government Association estimates that the care funding shortfall will amount to £1.5bn for the 2020-21 financial year. Based on current spending predictions, in just five years this is expected to soar by 133% to £3.5bn.

More families are using up their savings to plug the funding gap…..

….. Family members and friends are already having to contribute towards the care of the elderly. The CEBR report says that 20% of people whose loved ones are receiving professional care are paying for some or all of it.

The average contribution is relatively modest, at about £5,900, but some people report giving more than £50,000 towards a loved one’s care. This is typically paid in monthly instalments, although some provide support once or twice a year.

“Almost no one has planned for long-term care,” said Baroness (Ros) Altmann, the former pensions minister and an expert on later-life issues.

“Despite growing numbers of frail, older people in our society, neither central nor local government has a sustainable plan to pay for care.”

She added: “The sooner we start planning for care, the better.”

The Department of Health and Social Care said: “Putting social care on a sustainable footing is one of the biggest challenges we face as a society, and we will be bringing forward a plan this year.”


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