We all want to live longer. But someone must pay
Simon Jenkins
The Oxford professor of gerontology Sarah Harper this week declared that the
life expectancy of a British baby born today is an astonishing 104 years. Modern
medicine is lengthening the average life span by 15 minutes with every passing
hour. Seventy is the new 50. Pensioner marriages are soaring.
As a result, Harper points out, we are in “the crazy situation” where the young
can be in education right up until their mid-20s, and then retired from their
early 60s until their 90s. For over half a lifetime, people will be economically
inactive, living off and not contributing to the common weal.
Longevity may be good news for people such as me, who wish, with Woody Allen, to
gain immortality by not dying. But someone must pay. For most of history, old
age has been a charge on families and local communities. Since there was not
much of it about, the burden was sustainable. Today’s old people live longer,
but they are ever more voracious consumers of health and social care. The cost
has been creeping up, the elderly already consuming close to half the NHS
budget.
That is why the more I ponder Theresa May’s U-turn on care for the aged the more
disastrous it seems. It was not just an election gaffe. It rightly challenged a
critical feature of the welfare state; that there should be free care from
cradle to grave. As such it should never have been tossed into the middle of an
election campaign, when the merchants of petty populism are in command. In the
event, the U-turn has locked down debate for a parliament. As on national
insurance, business rates and Hinkley Point, May is emerging not as a strong,
stable leader, but as weak and wobbly.
Money for the care of the elderly has to come from somewhere; from general
taxation or from the insurance and savings of the elderly themselves. Pundits of
the actuarial sciences such as Andrew Dilnot have struggled to find an
acceptable mix of subsidy, charging and insurance. None had found favour, until
May’s office thought it a good idea to shock the campaign with her dramatic
proposal.
She declared that the state would not have a cap on how much private assets
should contribute to care costs, and she would expect those assets “at risk” to
include houses. Only a maximum residue of £100,000 would be left in estate
hands. In an age of long-term incurable diseases such as Alzheimer’s,
Parkinson’s and dementia, she and her advisers felt that to saddle the state
with the cost of home care was simply unrealistic. Looking after those unable to
look after themselves should revert to being what it was throughout history – a
family responsibility.
As the health secretary Jeremy Hunt put it: “The assets that you build up over
your lifetime should be used to pay for your own care costs.” Where someone owns
a house worth £1m or £2m, and has expensive care costs of perhaps £100,000 or
£200,000, he said, it was only fair on other taxpayers for them to bear the
burden. It meant that even a house worth the UK average of £218,000 would be at
risk of disposal, even if disposal and payment were postponed until after death.
To Hunt and May, the rich had saved against a rainy day. When it rains, they
should spend.
What baffles me is that May could not see this was ideological dynamite – both
to the left and the right. It was, first, a substantial act of privatisation,
shifting the burden of care from the welfare state to individuals and families,
whose estates would be wholly at risk in the case, for instance, of prolonged
dementia. It was also a substantial redistribution of wealth. The cost of
incapacity in old age would fall on the state only if you were very poor. It
could prove a colossal supertax on the rich.
Cynics could see the proposal popularising living wills and giving new urgency
to the cause of regulated euthanasia and assisted suicide. Back in the mid-20th
century, the distressed aristocracy had to donate their country houses to the
National Trust, disinheriting their heirs, if they wanted to go on living in
them for life. For the aristocracy, now read the property-owning middle classes;
for the National Trust, read at-home care.
Despite decades of intermittent socialism, we have long taken it for granted
that the rich can privilege their offspring with unearned income on their
deaths, subject only to estate duty. Bequeathing assets is seen as a right
attaching to the parent. The child is merely the lucky bystander. Harper points
out that life expectancy is changing this. Today’s children may not inherit
anything until they themselves are pensioners.
The trouble for Hunt, as for May, is that generous care in old age may seem
unfair – and even unsustainable – but it is inherent to the NHS. When the
explosive reaction duly occurred, May’s U-turn was the more humiliating for her
assertion that “nothing has changed from the principles on social care policy
that we set out on our manifesto”. Of course it had. She first said estates
would have open-ended liability for the cost of elderly care. Now she says they
will not. All politicians lie, but they would best not do so with their backs to
the wall and the cameras rolling.
The prime minister was indeed brave in opening up a classic area of political
reform, plunging into the ideological entrails of Tory privatisers and Labour
egalitarians alike. She asked: Do they really think the welfare state can handle
life expectancy to 100 free of charge? Do they really expect taxpayers to bear
the now soaring burden of long-term care? Do they really believe that we
accumulate savings, not to help ourselves through tolerable old age, but simply
to enrich our children?
May has proposed a social care green paper. This will have to tackle the
fiendishly difficult question of where the new cap will be fixed to place an
“absolute limit” on the amount that people would have to pay. It should also
examine the role of estates and inheritance in relieving burdens on the welfare
state.
It may be misery for children to watch their future wealth drain away, as their
parents fail to die. But that is what families are about. They should accept the
risks and hardships that may come with the boon of longer life. Last month, May
asked the electorate a challenging question that needed to be asked. Then she
lost her nerve.