The so called “dementia tax” has reared its head again, after footage emerged of Jackie Doyle-Price, the government’s care minister, telling a fringe event at the receny Conservative Party conference that homes shouldn’t “shouldn’t be seen” by people as “an asset to give to their offspring”.
Doyle-Price said: “The reality is that the taxpayer shouldn’t necessarily be propping up people to keep their property and hand it on to their children when they’re generating massive care needs.”
She later added the government would be “very much looking at… the whole issue of caps and floors”, with the government set to consult on changes to the social care system.
The last Tory manifesto outlined plans to take property value into account when means-testing care funding.
Although the party promised to protect £100,000 of a person’s wealth critics soon dubbed the proposed policy a “dementia tax”, as those facing expensive care could face huge costs.
Impact on expats
Peter Brooke, an adviser with Spectrum IFA, based in France, said the proposals highlighted an increasingly important need for planning amongst prospective expats especially in the light of Brexit.
“There should be no issues for those already in France where they will be looked after to a very high standard under the French system.
“As far as we know, everyone in the French health system should stay in the system post-Brexit but newly retired arrivals may not have an S1 certificate (a UK document giving access to French healthcare under EU rules) after Brexit and so these rights could disappear.”
Rachael Griffin, tax and financial planning expert at Old Mutual Wealth urged the government to stop “scaremongering”.
“A crucial issue with the whole social care debate is the government’s delivery of proposals around the issue,” she said.
“People are still on-edge from the manifesto proposals that they should use their homes to pay for care and now ill-explained comments are adding fuel to the fire.
“The government need to put a halt to the scaremongering around the issue and deliver fully thought out and well communicated policies.
“It wouldn’t be unreasonable to see using your house as a way to pay for care in the green paper – as long as it is a package of proposals which people have a chance to consult on.”
Make your own plans
OMW is expecting the delayed government Green paper proposals on the issue to take a two-pronged approach on how to help those of the baby boomer generation who don’t have time to accumulate the wealth needed to pay for care, and the younger generations, who can steadily build that wealth over time – perhaps through an auto-enrolment system.
“Whatever solutions they propose, a crucial element will be transparency,” added Griffin. “So people can understand what they are paying for and what they are getting when it comes to state-sponsored care.
“Given this state of affairs people should do their best to ignore the noise and do what they can to make their own provision for the cost of later life.”