Ros Altmann: We face a care catastrophe that will make pensions seem a minor problem

After recent scandalous headlines of elderly people being denied the care they need, forced to sell everything to pay for care, treated without dignity or left worrying about the security of their care home, it is clear that reforms of our care system are required.

Both funding and delivery of care for increasing numbers of older people are inadequate. Given the importance of this issue, the last thing we need is to see headlines about Andrew Dilnot’s review recommendations – due to be published today – turning into a political football.

Cross-party consensus is urgently needed to move forward quickly with a new care funding system. The current system is complex and unfair – potentially forcing enormous costs onto anyone who has more than £23,250 of assets and failing to offer meaningful incentives for individuals to plan properly for their possible care needs.

We have had major official inquiries into care funding in the past, but they have not delivered real reform. We must not fail this time. Latest figures show that local authorities are cutting care spending on the elderly by 8 per cent – even while the numbers in need of care are rising.

Up to 80 per cent of local authorities are now denying care to those with moderate needs and only funding those with substantial or critical needs. Therefore, nearly a million people who require care receive no funding for it.

Yet, these short-term cost savings will lead to higher spending in the long-run, since funding care now can save money on future health spending.

But there are huge gaps in our social care budget. Even the extra £2bn in funding for care. that local authorities were promised by 2015, has not been ringfenced. So that money is not getting through to where it is needed.

And, unlike pensions, the private sector has put virtually no money aside for the potentially huge costs of care.

With pensions, billions of pounds are already earmarked (even if we know it is not enough to give everyone a comfortable retirement, at least some money is there), but for care there is hardly a penny saved by anyone! Where will the money come from to look after the rising numbers in need in future?

The Commission will set out why it is important for the private sector to become involved in saving or insuring for care needs, as well as highlighting how early and preventive care can save unnecessary health spending in future.

Care has always been the health sector’s poor relation in the eyes of the policymakers, with £83bn spent on social security benefits for older people, £50bn on the Health Service – but just £8bn on social care. Hardly a wonder, then, that care standards are slipping.

The report will set out a way forward. Government must listen carefully and act. Unless the Dilnot recommendations are taken seriously, we face a care catastrophe that could make the pensions crisis look like a minor problem by comparison.

The issue of care is huge and escalating. In 1901, you could barely fill a football ground with the population of over-85s – there were just 61,000. In 2011 there are 1.5 million and in 20 years there will be 2.5 million.

Failing to fund care will also have dire ramifications for the health service, and the economy. Keeping an older person in a hospital bed costs £3,000 a week, but caring for somebody outside hospital costs under £1,000 a week. If care funding is not addressed, then the NHS will be overwhelmed.

We have spent so much on health to keep people alive longer but we now need to ensure we allocate more resources for care, so the increasing numbers of older people can be looked after with dignity and decency.

With more spending on prevention and intervention, many older people could stay happily in their own homes, where they want to be, and save the NHS a fortune.

For example, 70 per cent of emergency hospital admissions are down to over-65s who have had falls but such huge health service costs could be prevented by appropriate care and adaptation of accommodation for older people.

We need a new settlement which allows the private sector to become involved in saving or insuring for care needs and which helps save unnecessary – and ultimately unaffordable – health spending in future.

It may well be great news that we’re all living longer – but it’s not so great news that our older citizens face one of the least well supported care services in Europe. This is a national issue, with importance well above party politics.

Andrew Dilnot’s recommendations offer a real opportunity to address this problem properly. Let us hope they will form the basis of a new settlement for care in this country that we so urgently need.