Residential care plan still penalises savers unfairly
GOVERNMENT plans to reform the funding system for elderly residential care remain woefully inadequate.
Allowing people to defer selling their home to cover fees until after their death is a good idea.
But making them pay upfront for care costs until their non-property assets have fallen below £23,250 is both unfair and self-defeating.
Because of the very high cost of residential care, nearly every elderly person with savings above that threshold will be given an overwhelming incentive to go on a pointless spending spree simply to get below it.
That in turn will mean very little money is actually saved for the public purse through the imposition of such a limit.
And yet the limit will serve as a significant disincentive to younger generations to save responsibly for the future.
Everyone will know that being a spendthrift during one's working life is the most efficient way of eliciting maximum state support in old age.
No administration that wishes to forge a reputation for being on the side of hard-working people would go ahead with such a policy. So this one needs to perform an urgent U-turn.