Jeremy Hunt is the Member of Parliament for South West Surrey and Secretary of State for Health. Follow Jeremy on Twitter.
As Conservatives, doing the right thing for people who have
worked hard and saved all their lives is a top priority. Every year more than
30,000 people have to sell their homes to pay for the cost of care. The current
system, which only provides state support if your assets are above £23,250, is
unfair and sends out completely the wrong message – that if you work hard, save
for your future and want to have something to pass on to your loved ones, your
savings can disappear in a puff of smoke if you end up needing long term care.
As one in three of us will get dementia and one in ten end up with more than
£100,000 of care costs, this is a problem a responsible government cannot
So my new reform package includes from 2017:
- A cap on care costs at
£75,000. The intention is not that people should pay the £75,000, but that they should not have to pay it because they can cover it through,
say, an option in their pension plan. Only with the certainty of knowing
there is an upper limit to costs will pension companies or insurance
companies offer this.
- Increasing the threshold
for financial support from £23,000 to £123,000. This will help
strivers on low incomes who may have saved and bought a house for which a
potential £75,000 cost could still mean losing it.
The package will cost £1 billion a year by the end of the next Parliament, from
which around 20% of the cost will come by extending the freeze on the threshold
for Inheritance Tax. This is right because overall these proposals offer a much
stronger way of protecting inheritances people have worked for all their
lives – by allowing them to make provision so a family home is never at risk,
something that currently is not possible.
We have now delivered in just two years what Labour ducked for 13 years. We can
be proud we will be perhaps the first country in the world which, in the face
of an ageing population, is building a system where people plan and prepare for
their care costs as much as they plan and prepare for their pensions.