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The most recent figures suggest there are currently around 410,000 people living in residential care in the UK. Around 70 per cent of homes are classed as residential, with nursing homes making up the rest. On average, the weekly cost of residential care is £704, compared to £888 for nursing care. And care homes providing specialist dementia care charge significantly more.
Who pays for residential care?
In England, a person’s ability to pay for care is calculated through a means test. Their own home will not be included in this test if:
- they receive care and support at home; or
- they go into residential care temporarily.
If the move into residential care is permanent, their home is usually excluded from the means test if their partner still lives there.
If a person’s capital exceeds £23,250, they will likely have to pay their care fees in full. Below that figure, although they might qualify for some help from their local authority, they may still need to contribute themselves.
On their website, Age UK provides a considerable amount of helpful information concerning the cost of care. |
New Prime Minister, Rishi Sunak, has inherited a social care system described as ‘broken’ by many experts in the sector. In 2020/21, total expenditure on adult social care rose sharply to £26 billion, a real terms increase of 4.8% on the previous year. That equates to an annual cost per head of population of £585.
Social care cap
On 7 September 2021, the government announced their plans for reforming adult social care in England. This includes a lifetime cap of £86,000 on the total amount that anyone in England will need to contribute to their personal care.
In addition, the point at which a person becomes eligible for some financial assistance from their local authority, known as the upper capital limit, will increase substantially from £23,250 to £100,000. The threshold below which no contribution is required, known as the lower capital limit, will increase from £14,250 to £20,000.
However, no sooner was the announcement made than questions arose over its interpretation. Currently, residential homes do not break down their charges between:
- care costs;
- accommodation charges; and
- the everyday cost of living.
It seems likely that the care cap applies only to the “personal care” element. That means costs relating to accommodation and the daily cost of living will continue to be the resident’s responsibility.
Delay to social care cap
The government originally planned that the social care cap would come into effect in October 2023. But even before the financial tremors following September’s mini-budget, its affordability was in considerable doubt. Indeed, there were strong suggestions that its implementation would be pushed back to 2024.
However, in his Autumn statement, Chancellor Jeremy Hunt announced a two-year delay to 2025, ie after the next general election.