Cap pledge for elderly care costs

A £72,000 cap on elderly care costs and new legal rights for carers has been promised in the Queen's Speech.

Tougher checks on hospitals, including an Ofsted-style rating system, on the back of the inquiry into the Mid Staffordshire hospital scandal are also being brought forward under the Care Bill.%VIRTUAL-SkimlinksPromo%
The measures are part of a package that ministers say will join up health and social care to boost protections for patients and simplify the system.

Care cost reforms were left out of a draft Bill published by the coalition last year, sparking fears the plans would be kicked into the long grass, but earlier this year the Government announced it would introduce a £75,000 limit on bills in England.

A month later in the Budget, plans were announced to accelerate the introduction of the cap, bringing it in at a level of £72,000 in 2016 - a year earlier than originally intended.

The limit is more than double the £35,000 recommended by the independent Dilnot Commission in 2011 but the Government said today it would "give everyone peace of mind by protecting them from catastrophic costs".

Under the Bill, the threshold for financial assistance will be extended. It was originally expected to go up from £23,250 to £123,000 but under the Budget revisions will be set at £118,000 in 2016.

Ministers believe certainty about the maximum bill people could face will allow everyone to buy insurance to protect them against the possibility of care costs.

In a joint introduction to the speech Prime Minister David Cameron and Deputy Prime Minister Nick Clegg said: "If you have contributed all your life, you should be rewarded in retirement. So we will introduce a Bill to cap social care costs, meaning that pensioners do not have to sell their homes to fund care."

The Bill includes a number of measures in response to the Robert Francis inquiry into Mid Staffordshire NHS Foundation Trust, which found as many as 1,200 patients could have died after they were ''routinely neglected''. It will enshrine proposals outlined by Health Secretary Jeremy Hunt in March to give a new chief inspector of hospitals, a so-called ''whistleblower-in-chief'', powers to shine the spotlight on failing trusts.

An Ofsted-style ratings system - where hospitals and care homes will be ranked on their performance - will be introduced and it will become a criminal offence to provide false or misleading figures about how well they are doing.

Sir Merrick Cockell, chairman of the Local Government Association, said: "The priority is fixing the financial crisis engulfing adult social care. Local authorities are facing an estimated £2.7 billion reduction in funding to provide support for vulnerable residents. The stark reality is that if such vast sums of money continue to be taken out of the care system, it could be in very real danger of collapse."

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Cap pledge for elderly care costs
Figures from charity Age UK show that 29% of those over 60 feel uncertain or negative about their current financial situation - with millions facing poverty and hardship. Even though saving for retirement is not much fun, the message is therefore that having to rely on dwindling state benefits in retirement is even less so. To avoid ending up in this situation, adviser Hargreaves Lansdown recommends saving a proportion of your salary equal to half your age at the time of starting a pension. In other words, if you are 30 when you start a pension, you should put in 15% throughout your working life. If you start at 24, saving 12% of your salary a year should produce a similar return.
Many older couples rely on the pension income of one person - often the man. Should that person die first, the other person can therefore be left in a difficult position financially.
One way to prevent financial hardship for the surviving person is to take out a joint life annuity that will continue to pay out up to 67% of the original payments to the surviving partner should one of them die.

The disadvantage of this approach, however, is that the rate you receive will be lower. Again, the Pensions Advisory Service on 0845 601 2923 is a useful first port of call if you are unsure what to do.

Around 427,000 households in the over-70 age groups are either three months behind with a debt repayment or subject to some form of debt action such as insolvency, according to the Consumer Credit Counselling Service (CCCS).

Its figures also show that those aged 60 or older who came to the CCCS for help last year owed an average of £22,330. Whether you are retired or not, the best way to tackle debt problems is head on.

Free counselling services from the likes of CCCS and Citizens Advice can help with budgeting and dealing with creditors.

Importantly, they can also conduct a welfare benefits check to make sure you are receiving the pension credit, housing and council tax benefits, attendance and disability living allowances you are entitled to.

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The average UK pensioner household faces a £111,400 tax bill in retirement as increasing longevity means pensioners are living on average up to 19 years past the age of 65, according to figures from MetLife. And every year in retirement adds an extra £5,864 in direct and indirect taxes based on current tax rates to the costs for the average pensioner household. You can be forced to go bankrupt if you fail to pay your taxes, so it is vital to factor these costs into your retirement planning.It is also important to check that you are receiving all the benefits and tax breaks you are entitled to if you want to make the most of your retirement cash.

The cost of a room in a care home in many parts of the country is now over £30,000 a year, according to figures from Prestige Nursing and Care. So even if the prime minister announces a cap on care costs - last year the economist Andrew Dilnot called for a new system of funding which would mean that no one would pay more than £35,000 for lifetime care - families will still face huge accommodation costs. Ways to cut this cost include opting for home care rather than a care home. Jonathan Bruce, managing director of Prestige Nursing and Care, said: "For older people who may need care in the shorter term, home care is an option which allows people to maintain their independence for longer while living in their own home and should be included in the cap." However, the only other answer is to save more while you can.
Older Britons are often targeted by unscrupulous criminals - especially if they have a bit of money put away. For example, many over 50s were victims of the so-called courier scam that tricked into keying their pin numbers into their phones and handing their cards to "couriers" who visited their homes. It parted consumers from £1.5 million in under two years. Detective Chief Inspector Paul Barnard, head of the bank sponsored dedicated cheque and plastic crime unit (DCPCU), said: "Many of us feel confident that we can spot fraudsters, but this type of crime can be sophisticated and could happen to anyone." The same is true of boiler room scams that target wealthier Britons with money to invest, offering "once-in-a-lifetime" opportunities to snap up shares at bargain prices. Tactics to watch out for include cold calling, putting you under pressure to pay up or lose the opportunity for good, and claiming to have insider information that they are prepared to share with you.
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