Gareth Lyon is the Head of Policy and Communications at the Associated Retirement Community Operators. He is a former councillor in Rushmoor and the Chairman of the Aldershot and North Hants Conservative Association.
Whilst the recently announced delay to the Government’s proposals on reforming social care will come as a big disappointment to a sector which has been lacking in political and policy direction for a long time, there may be a silver lining if this is used as an opportunity to reframe the debate away from the demand side hole it is stuck in right now – ie, how care is to be funded. Important though that is, we must also look at the opportunities presented by supply-side reform and how care is delivered.
Of course social care is not sufficiently well funded in this country and something needs to be done about it. Part of the solution may well lie though, in structuring services so that people actually choose to fund their own care by buying in to a wider package including lifestyle and wellness offerings as well as convenience and the ability to avoid financial hassle and risk.
This is certainly one of the lessons the UK can learn from Australia and New Zealand where the shape of the care system is very different to over here, and where far greater choice of options exists.
A major feature of the care landscape in those countries is retirement villages, known in the UK by a variety of terms including Extra Care and Retirement Communities. They combine the benefits of older people being able to live in a home of their own (with every resident owning or renting a flat or bungalow) and the security of 24-hour onsite staffing, the provision of high quality onsite care, and the availability of onsite facilities such as restaurants, gyms, allotments, bars, swimming pools etc.
Older people choose to move into a retirement community because of these advantages, the social benefits of having a community available onsite, and the well documented health and wellness advantages which make it much less likely that they will end up in a care home or residential home.
Retirement communities are fundamentally different to the sheltered housing or retirement flats we are familiar with in this country – not just because of the provision of care and facilities, but also because of how they operate – the developers not just building out and moving on, but staying onsite and providing these services funded by service charges and fees tied to the value of the property when people come to selling on.
The result of this is that the care which is provided onsite is subsidised out of the fees which people voluntarily choose to pay. Care which reduces the strain on the wider social care system and which would not otherwise have received this funding.
There is a clear lesson to be learned here – that contrary to all public policy presumptions at the moment, people need not be forced to pay for care. By providing the right package of services people are prepared to pay for it themselves.
A very high proportion of older people own their own homes and are at least theoretically in a position to take up this opportunity. For those who do not, the UK already has a well respected affordable housing version of retirement communities, which is well placed to expand and form one of the centre pieces of a new system.
As things stand, in the UK our retirement communities sector provides about a tenth of the capacity per head of population that the New Zealand and Australian sectors do. For this sector to play a role there will need to be significant growth – and fast.
It is interesting that investors appear to have detected the opportunity presented by new forms of provision before policymakers have. Major long-term capital investors such as Legal & General, AXA, Schroders, and Bupa have all made and are making investments in the nascent UK retirement community sector.
It is however clear that, as with any new sector, new and adapted regulation, specifically in relation to planning, consumer protection, and leases is needed. Early indications are that the Government understands that something needs to be done but has not yet found the administrative capacity to do it.
Yet compared to the much more intractable challenges of securing consensus on funding reform for the wider social care system, and with several months set to elapse before that fight even begins, there is certainly something to be said for the Government dedicating at least some of its energies to the supply side options already presenting themselves now.