The commission was chaired by Andrew Dilnot, an economist and broadcaster.
The bills for caring for us are soaring. 25% of people aged over 65 can expect a bill of over £50,000 – one in 10 can expect a bill in excess of £100,000
The recommendations, if adopted by the Government in full, would mark a pivotal change in direction in the payment of care fees for the elderly in England, and would be the most significant change for decades.
The current system of paying for care provides that anybody wanting care, be it in their own home or in a care home, are financially assessed and if they have assets worth more than £23,250 (including the value of the home) then they would be responsible for the costs of their care in full until the individual's assets drop to £23,250.
This is in contrast with the Scottish system, under which the cost of care is met fully by the state.
It has been widely accepted by the Government that the current system of charging is unfair. The bills for caring for us are soaring. A quarter of people aged over 65 can expect a bill of over £50,000; one in 10 can expect a bill over £100,000.
Among the recommendations in the report to the Government are:
That the individual's lifetime contribution towards their social care costs, which are potentially unlimited, should be capped. After the cap is reached, the individual would be eligible for full state support. The commission reported that the cap should be between £25,000 and £50,000. The commission clearly stated that £35,000 is the most appropriate and fair figure.
The means-tested threshold, above which people are liable for their full care costs, should be increased from £23,250 to £100,000.
National eligibility criteria and portable assessments should be introduced to ensure greater consistency.
All those who enter adulthood with a care and support need should be eligible for free state support rather than being subjected to a means test.
The commission estimates that its proposals – based on a cap of £35,000 – would cost the state about £1.7 billion – less than the cuts being made to public sector pensions.
It is largely agreed that the current system is confusing, unfair and unsustainable.
The combination of introducing a cap in the individual's contributions to their care costs and raising the upper threshold in the means-test would mean that, instead of potentially losing almost all their assets to cover the cost of going into residential care or receiving care at home, no one would lose more than 30 per cent of their assets.
In addition to the £35,000 cap (which, in essence, means that no one would have to pay more than £35,000 toward their care costs) there would also be an additional fixed general living cost contribution of between £7,000 and £10,000 per year. This cost would be towards the so called "hotel" elements of care, such as the room, bed and food, and would be uniform across England.
This would work out at approximately £200 per week and is based on the theory that if the person in care were living in their own home they would still have these costs to pay.
It is expected that the Government will now face lobbying from individuals and organisations to implement these recommendations in full, and will come under pressure to do so without diluting them.
There is a wide expectation that these recommendations, if adopted, will lead to the proliferation of investment products to assist individuals in meeting this care cost, as critics of the report say that some people will struggle to raise the capital in their working life.
The likelihood is that insurance providers and actuaries, if a cap is set at a clearly defined annuity, will be able to develop viable products to allow people to protect themselves against future long-term care costs.
If the report is adopted in full, it would mark the end of the era where individuals are worried about losing their home to pay for care, and they would not be penalised for saving for retirement.
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