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Redwood hits out at Dilnot plans

Conservative MP John Redwood has hit out at Andrew Dilnot’s proposals for long-term care funding for the elderly.

In a report for the Centre of Policy Studies, Care for the Elderly, Redwood argues the Dilnot proposals go too far in extending liability to the taxpayer.

The Dilnot Commission proposed a cap on the cost of care of £35,000 and an increased means-tested threshold of £100,000.

Redwood says the estimated £1.7bn annual cost of the policy would be better spent improving care homes than funding a proposed £35,000 cap on care costs.

Reports suggest the Government is moving to accept Dilnot’s proposals in its Care and Support Bill in the autumn.

Redwood says: “One must question whether the £1.7bn cost of the cap is the best use if further funds are available. This money will mainly go towards protecting the inheritances for families who can afford to pay for care. Furthermore, Dilnot’s claim that the cap in itself will generate an insurance market has been met with a mixed reception by the industry.

“Now is not the time to develop a new state programme which will be incredibly difficult, politically, to rein back if downside risks are realised.”

Redwood says there are a series of barriers preventing individuals taking out insurance including uncertainty around future unit care costs, future healthcare needs, the belief that the state provides free care and the complexity of products.

The Association of British Insurers has hit back at Redwood’s suggestion that the industry does not support the Dilnot plans by writing to him to explain its belief that Dilnot would stimulate the development of long-term care insurance products.

Redwood believes equity release should be used to fund care rather than richer children inheriting their parents’ housing wealth.

In January, Money Marketing revealed Liberal Democrat concerns that Dilnot’s funding plans would be expensive, bureaucratic and regressive.


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There are 2 comments at the moment, we would love to hear your opinion too.

  1. He was a prat back then and he still is apparently.

  2. I’ve said it before, but I still don’t see why this Dilnot fellow considers committing £1.7Bn of tax payers’ money a better proposition than encouraging private sector provision by way of allowing tax relief on regular premiums to LTC insurance policies. £100m AP x 20% tax relief would cost the exchequer a (relatively) mere £20m p.a. and, if the take-up is less than anticipated, then although the plan might be a failure, it wouldn’t be a very costly failure and must surely be worth trying first?

    Where’s the logic in going first for the vastly more expensive option? If families aren’t prepared to spend just a reasonable amount of money to insure against the potentially large costs of LTC, then they have no one to blame if severe damage is inflicted on the estate of the person who has to go into care.

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