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Caring for the Elderly

I agree with the hon. Gentleman to the extent that the funding gap has to involve more private resources—I totally agree with that. However, although it may be the policy prescription that he espouses, I do not think that it is necessarily true that those resources have to come out of the savings of retired people in retirement. It is, to my mind, one of the unattractive policy options canvassed by the Government that we should have a compulsory system that pays for provision exclusively through what is, in effect, a tax on elderly people. I think that we should be encouraging people to look forward to their likely evolving need during their working lives, and the secret to doing that lies in the insurance system. The Government identify what they describe as partnership funding. As I said in an intervention on the Liberal Democrat spokesman, the hon. Member for Leeds, North-West (Greg Mulholland), the Government's definition of partnership funding is different in an important respect from Wanless's definition of partnership funding. As it happens, I am more on the side of the Government than I am of Wanless in that debate. However, the Government identify partnership funding as one option and then imply that insurance is a different option. I think that they are wrong to imply that they are different; in fact, they are one and the same option. In my view, the Government's refashioning the resource that is currently provided from the Exchequer—using Government money more effectively—in partnership with private resources will, if the Government develop a proper policy, automatically lead to an insurance market that allows resources to be mobilised in a way that is significantly fairer than trying to pay for the provision from a tax on pensioners, which is what I understand the Government's so-called comprehensive option to be. The core challenge, which the Government acknowledge but do not face head-on, is to use existing public resources more effectively and in a way that enlists private resources in order to fill the Wanless funding gap.