'Target winter fuel benefit to pay for elderly care'

 

MP Paul Burstow says savings could be used to help people with "horrendous care bills"

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Winter fuel payments should be means-tested to help pay for care of the elderly, a former minister has said.

A report by Lib Dem MP Paul Burstow said targeting the allowance would help pay for a fairer social care system.

The report said it could fund most of the £1.7bn cost of implementing reforms of elderly care in England.

While David Cameron said universal benefits for pensioners would be protected the BBC understands ministers are poised to back a cap on care costs.

Last year the Dilnot Commission recommended that the cap on the amount individuals have to pay towards their social care be set at £35,000 over a lifetime.

The commission, set up by the government, argued that such a move would protect people from catastrophic care costs that result in them having to sell their homes.

At the time, ministers said a cap was the "right basis" for change but they needed to look at other cheaper options.

The BBC's chief political correspondent Norman Smith said there were growing signs that a commitment to a cap could be included in the coalition's mid-term review expected to be published shortly.

Start Quote

We appreciate that the country is facing difficult financial times , but we must be careful that the wider implications for older people of any potential source of funding are fully considered”

End Quote Michelle Mitchell Age UK

As things stand, older people in England have to pay for their care costs if they have assets of more than around £23,250. Similar systems exist in Wales and Northern Ireland, but in Scotland personal care is provided free.

Under the proposals from Mr Burstow and the Centre Forum, the cap on the amount people should pay towards social care costs would be set at £60,000 but the amount of assets people could hold would rise to £100,000.

They said winter fuel allowance should be limited to those receiving pension credit.

Pension credit takes into account savings and income, and only the poorest retired people qualify to receive it.

The move would save £1.5bn a year and mean about three-quarters of current recipients would lose the allowance, which is worth between £200 and £300 per household, Mr Burstow's report explains.

The report also proposed ending the relief on capital gains tax at death. This would raise another £600m a year, it said.

A trade-off

Mr Burstow, the former care services minister, said: "Social care isn't free, but it could be a lot fairer for those who have worked hard all their lives.

"By concentrating the winter fuel payment on those eligible for pension credit, we can pay for a cap on care costs."

He said there were 100,000 pensioners with incomes of more than £100,000 a year and questioned whether it was "right" to continue to pay them winter fuel allowance as many of them admitted to using the money for other things.

David Cameron: "I made a very clear promise at the election which was that we would keep the payment"

Michelle Mitchell, of Age UK, said introducing a cap on social care costs would "lift one of the great fears of becoming older".

But she urged caution over taking away other benefits from the elderly.

"We appreciate that the country is facing difficult financial times, but we must be careful that the wider implications for older people of any potential source of funding are fully considered."

'Best model'

The suggestion that winter fuel payments should be targeted comes amid rising controversy about the allowance and amid the continuing debate over how to pay for long-term care for the elderly.

Any commitment to a cap would be significant, Norman Smith added, as previous governments had shied away from such a move due to the huge cost implications involved.

However, he said no details of the level at which a cap would be set, how it would be paid for and when it would come into effect were likely to be given.

Earlier on Thursday, Health Secretary Jeremy Hunt said the UK had a "long way to go" if it was to be regarded as one of the best places in Europe to grow old.

"There is no doubt capping costs - the principle recommended by Dilnot - is the best model. The key question is how to fund it sensibly given the current deficit.

"We are looking at how to achieve this, along with taking action to ensure people do not have to sell their homes to pay for care."

 

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  • rate this
    +4

    Comment number 159.

    Divide and conquer in action Look here, work shy cripples stealing your taxes. Look there, coffin dodgers robbing from your NI. Don't forget about those damn breeders raising kids! Whats that you say? The super wealthy screwing everyone else over? You ungrateful swine... you should be happy with the crumbs they give you... after we've taken our share to pay for our moats and duck houses of course!

  • rate this
    -1

    Comment number 158.

    Winter fuel allowance was always a political construct, introduced by Blair in 1997 to juxtapose 'caring' NuLabour with the 'nasty' Tories.
    There is no logical reason for it except in the sense of cash flow but that is not effected in practice. Very cold conditions kick off special payments anyway.
    Logically you'd add it to the pension if the 'winter fuel civil servants' will allow it.

  • rate this
    +2

    Comment number 157.

    As it has become customary, the hardworking 'squirrells' are expected to support many wasteful non-saving 'grasshoppers'! Considering the exorbitant cost of fuel millions of us benefit from this support. It may cost the government more money to means test this benefit than would be saved in the future.

  • rate this
    +3

    Comment number 156.

    121. Lin
    JUST NOW
    So, on this basis, we will penalise those who have contributed, paid in and worked, and yet give it to those pensioners who either didn't work (married women etc.,who paid a reduced stamp or who thought a full time career was looking after children)...
    __
    If looking after children is so unimportant, perhaps such people deserve to freeze to death. Do you really mean this?

  • rate this
    +2

    Comment number 155.

    The great majority of over 60's get £100 per year as winter fuel allowance. This will clearly go a long way to paying care home costs of up to £4000 per month. Or should Paul Burstow take a course in primary school arithmetic? Don't forget, Cameron is all for keeping pensioner benefits because, although they amount to peanuts, they have some PR value.

  • rate this
    +2

    Comment number 154.

    If pensioners had paid in enough, we wouldn't be in this state. The fact is they had free stuff all their lives, including dental treatment, student grants, council houses and mortgage interest tax relief and they are now making their own grandchildren pay for a 30 year retirement.

    It's just not on.

    Why should the poor subsidise pensioners?

  • rate this
    +2

    Comment number 153.

    I think its about time the general public have a monthly referendum to decide if politicians deserve paying at all. Additionally if the public vote to pay them that pay should then be means tested to see if they really need it.

  • rate this
    +4

    Comment number 152.

    My mother in law resides permenantly in a nursing home but still receives the winter fuel payment of which stays in her bank. Both my husband and I have asked why she still receives it as it is not needed.

  • rate this
    +13

    Comment number 151.

    Those who say that rich pensioners shouldn't get free bus passes or free prescriptions are missing out on a pretty obvious fact.... people like Alan Sugar don't use buses and can afford their own private healthcare. So be very very cautious about welcoming these proposals - I suspect its the start of removing all 'benefits' for anyone who has any private pension in excess of the State minimum.

  • rate this
    +2

    Comment number 150.

    Means test the benefit and only pay it to people in fuel poverty, no matter what their age, the young deserve heat too. It should not be paid in cash, instead should be paid directly to the energy company lowering the household bill.

  • rate this
    -1

    Comment number 149.

    ALL benefits should be means tested. My Mum (in her 80's) is substantially better off than a lot of my working friends ........ why should she get a winter fuel allowance? Benefits should be targetted at those who need it ........ not according to age!! I lose my family allowance this month ...... am I happy about it, NO ...... is it fair ....... YES !!!

  • rate this
    +31

    Comment number 148.

    This benefit is exactly that to millions of pensioners - the benefit of keeping warm and not worrying themselves stupid about putting the heating on. To save money now why isn't there an opt out system? Simple form on HMRC website...

  • rate this
    +3

    Comment number 147.

    I already pay several times what I get back from the state as a single person. So I don't have much sympathy for the whinging middle class complaining about the loss of universal benefits. Either we have massive wealth redistribution going on through taxation or we start paying a living wage. We have to carry the useless unproductive part of the population or face civil war.

  • rate this
    +1

    Comment number 146.

    The system definitely needs to be changed so that only the pensioners who need it get it, where ever they are living. If you are a pensioner and receive the Winter Fuel Payment when you don't need it then give it to a charity that helps people in real need instead of waiting for the government to sort it out.

  • rate this
    +4

    Comment number 145.

    When winter fuel payments are paid out they don't just vanish never to be seen again, they are recycled back into the economy.

  • rate this
    +2

    Comment number 144.

    A debate about how care for the elderly is funded in a society where people are living longer is needed.
    I don't believe that WFP on its own would do that.
    I don't believe that stopping WFP for pensioners receiving about £150-£160 per week is fair either.
    The simplist way is for it to count as income and be taxed at the prevailing tax rate.

  • rate this
    +22

    Comment number 143.

    As usual the nasty tactic of vilifying not reasoned debate. Tag several million people as 'baby boomers': hey presto! the case is made. My wife and I, born shortly after WW2, are retired and have final salary occupational pensions. We always donate the various allowances (TO WHICH WE CONTRIBUTED) to charity. Paying for care for the elderly is a serious matter. It should be discussed seriously.

  • rate this
    +4

    Comment number 142.

    The sense of entitlement amongst people is astonishing.

    I paid higher rate tax for decades. I could now be claiming benefits but I choose not to, because I dont need them.

    Benefits are for people who need them, not people who want to improve their lifestyle.

    And btw, the debt we're incurring to afford these handouts has to be paid back one day. I dread to think what will happen then.

  • rate this
    +1

    Comment number 141.

    Our grandparents, & often those who receive the benefits unfairly, have become dependant upon benefits.

    We should be allowed to keep our wages & savings, to look after families ourselves (not forced to give up at least £35k). We shouldn't have them taxed or eroded away by QE & FRB inflation. Don't dump ur parents into homes & expect the state to pick up the tab. Show some family responsibility!

  • rate this
    +7

    Comment number 140.

    Why not stop the food allowance for all MP's and Lords, instead of taking money off pensioners.
    Also what happened to the plans to introduce a new State Pension last year?
    Stop aid going abroad. Why wasn't a state of emergency declared in the U.K. for all flood victims recently.
    The £10 Xmas bonus could be cancelled if you must take money off us.

 

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