Insurers are urging the main political parties to clarify future plans on social care funding, and include firm commitments in their forthcoming election manifestos.
The call by Aegon comes as the party conference season draws to a close. It notes neither the Conservative nor the Labour Party mentioned this issue at their conferences.
It says individual remain “in limbo”, with the majority unwilling or unable to plan ahead when it comes to care. Aegon research shows only one quarter of working people have factored social care expenses into their retirement plans.
The Conservatives had previously proposed a social care funding deal, which was initially due to go live in October 2023, before being hit with a two year delay. Implementation will now be after the next general election, which means could see it changed, delayed further or scrapped altogether.
Aegon pensions director Steven Cameron says: “With much uncertainty over the future deal on social care funding, it’s very difficult for individuals to plan ahead. But with each generation living longer on average, we’re increasingly likely to face this expense, which can have a huge impact on our later life finances.
“Recent research from Aegon for our Second 50 report showed that while declining physical health was one of the greatest concerns in later life, only 25 per cent of those surveyed had considered the cost of paying for social care.”
He adds that the Liberal Democrats have said they would provide free care to all — although this is likely to exclude ‘room and board’ costs which can be significant.
He said the Conservatives have been quiet on the topic since last Autumn’s delay. “It would be good to have confirmation that they still plan to implement their funding if elected. Labour have not yet made its plans known but he says may wish to adapt the Conservative solution.”
Cameron adds: “The new Conservative deal offered much needed clarity on how much individuals in England (the rules are different in Scotland) would be asked to pay for social care if needed in later life.
“Importantly, the deal set a cap of £86,000 on how much an individual would be asked to pay for ‘eligible’ care costs, taking away the risk of those needing care over many years seeing their lifetime savings wiped out. Individuals would still pay for daily living costs and could also pay top-ups if they chose more expensive care facilities. A further change meant many individuals would qualify for means tested support sooner than under the current regime.
“These new rules gave far more clarity and if and when implemented, would mean people can plan ahead with more certainty rather than being caught by the more they save, the more they would be asked to fund themselves. Financial advisers are well positioned to help people here as they navigate their later lives.
“We are urging all political parties to give this the attention it deserves and to come clean on future plans.”
