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Personal Care at Home Bill

My Lords, I was a little uncomplimentary about this Bill in the Queen’s Speech debate on 26 November. The more I discover about it, the less I like it, as Members of this House will know from the letter that my noble friend Lord Lipsey and I circulated and from my Motion on the Order Paper. I shall be blunt. This is a seriously flawed Bill that has been inadequately discussed and scrutinised, and it takes us down an unaffordable path. It has been put together in a great rush in the search for clear blue water to place between Labour and the Conservatives. In my view, the Bill is not a step towards the wider reform of adult social care that we need and that the Department of Health has been seeking over the past two years or so; it is a political gimmick that the Government are trying to ram through Parliament before an election without proper scrutiny of what it will result in. Let me be clear at the outset about my position on free personal care at home. I have a track record in this area, having spent six years as a director of social services, helping elderly people to stay in their own homes as long as possible. I am proud of that record. Like many people in this House, I would favour free personal care at home for more people if it were affordable. However, at present it is not. Even when the public finances were in a better state than now, the Government turned their back on tax-funded free personal care: in 1999, with the report of the Royal Commission on Long-Term Care of the Elderly; again in 2006, when Sir Derek Wanless produced his report; and most recently in July 2009, when the Government published their own Green Paper which "ruled out" free care paid by the taxpayer. Page 18 of that Green Paper is the reference. Cometh the electoral hour, cometh the man. When the public finances face what the Institute of Fiscal Studies has described as "two Parliaments of pain", the Prime Minister decides to tell the world that we can afford more free personal care at home, a few months after he signed a foreword to a Green Paper with seven other Cabinet Ministers acknowledging that we cannot afford to pay for free personal care. He ruled out that option. I remain in the position I have been in for some time: that it is unaffordable at present. I am really pleased to see that the Liberal Democrats have acknowledged that it is not affordable at this time. The Conservatives remain a little inscrutable on the subject—they seem to have a preference for insurance—but they have not made rash promises that may be very difficult to deliver. I am grateful to the right reverend Prelate for what he said about not promising what you cannot deliver. I think that promising elderly and vulnerable people and their families something which is not affordable or deliverable any time soon is a rather cruel deception, and I certainly do not want any part of it. I turn now to the affordability and costs of the Bill. The Government say that it will cost £670 million a year, with £250 million being funded by local authorities—to which I will come later. In an admittedly incomplete survey of 132 local authorities by the Association of Directors of Adult Social Services, the Government figures are shown to be significantly understated. ADASS states that the annual bill will be at least £1 billion—some 50 per cent more than the Government’s estimate. The final cost could be even higher. The difference is because the Government have seriously underestimated how much care per week many of the people with critical care needs will require. It will not be over just six hours a week at an average cost of about £100 a week, it will be many more hours with costs ranging from £200 to more than £400 a week. The case that my noble friend cited in introducing the Bill sounded to me like it would require a lot more than six hours a week to keep that person in their own home. The Government's cost figures take no account of increased demand year on year, and little account of rising service provider costs. Their impact assessment states that there will be a 1.5 per cent annual increase in service volume from demography, and a 2 per cent annual increase in price for wage increases. In a Written Answer to me, the Government declined to accept that there will be any increase in demand, or that providers could put up their prices by more than 2 per cent a year. Although this is not directly comparable to the Scottish situation, the Government's stance flies absolutely in the face of the evidence from that social experiment, if I may put it that way. In Scotland, when home care became free, the costs doubled in four years between 2003-04 and 2007-08. The number of people claiming went up by 36 per cent in the same period. In the last of those four years, cost increases by providers were about 15 per cent in a single year. The Government's proposal will create a perverse incentive to have free home care rather than means-tested residential care, so why they regard it as unlikely that there will be increased demand totally eludes me. It is also worth noting that in Scotland, a debate has begun on the affordability of free care. I turn briefly to the uncomfortable position in which the Bill places local government. In a written reply to me of 27 January, the Government stated that gross current expenditure on adult social services in the past three years went up by 1 per cent, 0 per cent and 3 per cent in real terms. That compared with a nearly 15 per cent real- terms increase in NHS expenditure for the same period. My understanding is that from this less than generous position, local authorities must now find a further 4 per cent efficiency savings and their share of the £670 million. If it turns out that the Government’s estimate of £670 million is wrong, it looks to many people in local government—they are understandably concerned about this—that they will have to pick up an even larger tab at a time when many of them will also be losing income from the many people who pay charges now. This is an uncomfortable position for all members of ADASS and the local authorities they work in. Parliament is entitled to press the Government much harder on their costing figures and assumptions. My noble friend the Minister rather brushed this aside, relying heavily on the PSSRU. We should listen more carefully to the guys and gals who will be running this system in local authorities up and down this land. These are all matters where we might reasonably have expected to discuss in Committee some of the technical issues in more detail after the Government had completed their consultations on the content of the regulations and guidance and had given some indication of their response. Likewise, some of us have concerns—the noble Baroness, Lady Gardner of Parkes, referred to this—about the administration of the scheme and its added complexity. I do not have time to go into all these issues today, but the volume of assessment problems for local government and front-line staff could be quite considerable in this exercise. As I understand the Government’s intention, this is all to be completed, over the summer holidays, by 1 October—and yet the Government want us to be in Committee on 22 February, before they have completed their consultations and responded to the concerns expressed. Given that none of the new arrangements is in the Bill but are left to regulations and guidance, this seems to me to be—I do not use the term lightly—an abuse of parliamentary procedures for the proper scrutiny of legislation, especially in light of the limited scrutiny in the Commons. Simply passing to us some draft regulations—which the Government say will not be the finished business—to look at, without hearing how the Government are going to respond to the points made to them by many expert people in their consultations, is not sufficient. That is why I have tabled a Motion on the timing of the Bill going into Committee. I shall speak to that Motion at the appropriate time but I hope the Government will think again and give ground in this area. I am grateful for the support for this of the right reverend Prelate the Bishop of Norwich. The Bill will complicate an already complicated assessment system, which is itself under review following criticism from CSCI in 2008. The Government’s impact assessment at paragraph 5.21 admits that the "wealthiest older people" are the main beneficiary group. If we want to do more for carers, as I am sure many noble Lords do, there are better ways of doing so much more cheaply than by spending £670 million a year. The costs of implementing the Government’s proposals under the Bill look to be over £1 billion a year—the Government have not disproved that estimate—and will continue to go up faster than the Government’s estimates. The Bill is unaffordable given the current state of the public finances. We owe it to a younger, taxpaying, working population not to impose an unaffordable financial burden on them as our population ages. There is an inter-generational social justice issue around this area of activity and I urge the Government to get back to their Green Paper, work with the stakeholders and the other parties and try to secure much more consensus on the funding and service reforms needed for adult social care, rather than wasting more time on this Bill.