Savers subsidise those who made no provision for old age

For those in the know, like our family, it came as no surprise when “news” broke this week that so called middle-class pensioners are being forced to pay higher care home fees to subsidise those who failed to save for their retirement.
It seems that MPs found that councils are telling private providers to increase costs for pensioners who have to pay the fees themselves, thereby subsidising cheaper, council-funded places for pensioners who don’t have savings.
All this mean that “middle-class” pensioners are being charged much more for the same room and level of service. The shock, horror news was revealed by the Commons communities and local government committee, which describes it as “unacceptable”.
The committee’s report quotes research suggesting that self-funders were paying an average of 43 per cent more than councils were paying for an identical care home place.
A study by Age UK last year said councils typically pay between £421 and £624 a week for each care home place, while self-funders are charged between £603 and £867.
That does not include specialist care, such as dementia, or nursing costs.
These extras, in our experience in Suffolk at least, pushed the weekly fees to between £1,000 and £1,450.
Currently, anyone who has assets of more than £23,250 in England must pay their own bills, and councils start to meet the costs only when the value of their assets falls below that threshold.
Mind you, that’s not strictly true. MIL’s assets, which I consider to be saleable items and cash, are well below that threshold but she is not eligible for any council or government help.
This is because she and FIL sold everything they had to buy annuities five years ago to put towards their care home fees. I say out towards because the annuities do not cover the total cost.
Anyway, back to committee’s report which revealed that “several care providers had been advised by councils that they should subsidise the council’s fees by charging higher rates for private clients”.
Whilst we were looking for a new dementia care home for MIL last year we discovered that Suffolk County Council had closed its 16 council-run homes and linked up with private care provider Care UK.
The council “backed” the building of half a dozen state-of-the-art Care UK homes across the county with the proviso that the residents from the 16 now closed homes be accommodated. Seems fair. But is it really?
The Council pays Care UK £650 a week per resident. MIL’s fees, as a private payer for exactly the same room, food, laundry services and care, ranged from £1,050 to £1,350 at the four Care UK homes we visited.
I’ll leave you to do the maths.

SWMBO and I are able to squirrel away a little cash each month from this blog for any future care needs we may face.
You may have noticed the advertisements on this page. I am delighted to reveal that your click-throughs have raised, to date, the princely sum of …… £3.61.
That’s 36 minutes of future residential care paid for. Thank you.