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Labour peer hits out at ‘plain barmy’ LTC reform timetable

Labour peer Lord David Lipsey has branded the Government’s plans to introduce different aspects of its long-term care reforms a year apart as “plain barmy”.

The Care Bill is introducing a lifetime cap on care costs of £72,000 from April 2016 based on recommendations by economist Andrew Dilnot.

The Bill will also introduce a raft of other changes including greater access to long-term care advice and making the deferred payments scheme more widely available. The deferred payments scheme is run by local authorities and allows people to delay paying for their long-term costs until their house is sold upon death.

In a speech to the House of Lords later today, seen by Money Marketing, Lord Lipsey will hit out at differing timetables for the start dates with the deferred payments scheme starting in April 2015 and the cap on care costs 12 months later.

He says the two start dates are “plain barmy and a major self-imposed complication” that councils and advisers will have to deal with.

Lipsey has campaigned for long-term care funding reform as Society of Later Life Advisers president and served on the Royal Commission on the Funding of the Long Term Care of the Elderly in 1998.

He will also argue the cap is misunderstood because it is perceived as capping all costs when it does not. Labour has hit out at the cap for not including accommodation costs or the actual amount charged by care homes, claiming the true cap is £150,000.

He will say: “People have to understand what the Government’s Dilnot cap does and does not do. I am afraid ministers have spoken here with forked tongues. They have too often, from the prime minister downwards, given the impression the cap is £72,000 and nothing more, ignoring the higher fees in some homes, ignoring the contribution old people must make to their living costs – and thus suggesting the problem is solved without a private insurance product.

“My Lords, it is not, I repeat it is not. And therefore the Government has a duty to make sure old people and their families understand this crucial point so they can, if they wish, protect themselves privately.”

Lipsey will also call for higher qualifications for regulated advisers selling long-term care products.

He will say: “Too many [advisers] sell too much on the basis of too little knowledge. And the knowledge required is going to be much greater after the highly complex Dilnot reforms than it is now. I would say this wouldn’t I but the Solla gold standard qualifications seem to me the ones that should increasingly be required of advisers operating in this field.”

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