The definition of personal care is based on the draft regulations being made under sections 8 and 20 of the Health and Social Care Act 2008, which exclude chiropody and podiatry. These services are within the scope of health care services, rather than personal care.
The estimated additional costs for older people are based on analyses from the Personal Social Services Research Unit's (PSSRU) micro-simulation model for older people. The PSSRU cost estimates are broken down into groups of individuals with difficulty with different total numbers of activities of daily living (ADLs) on the basis of the average predicted need for each group—as referred to in table 1 of the impact assessment.
The additional categories not considered by PSSRU—that is, the estimates of residential care and informal care switchers—are then added. All of the residential care switchers are assumed to have difficulty with four or more ADLs.
The estimate of 110,000 younger adults eligible for free personal care at home is based principally on the referrals, assessments and packages of care (RAP) data from councils for 2007-08. In the absence of data on the proportion of younger service users whose needs are assessed as critical under fair access to care services (FACS) critical, for the purposes of the impact assessment, it is assumed that there could be some 100,000 younger adult local authority funded users receiving personal care in the critical category. It is likely that most of these receive their care free, as their incomes are generally low. It has therefore been assumed that 90 per cent. already receive free personal care at home and that 10 per cent. make a means-tested contribution towards the cost.
Little is known about the number of younger adults who currently fund their own care at home. It has been assumed that around a further 10,000 younger adults may be brought under state funding following the introduction of the Personal Care at Home Bill.
The figures have been rounded to the nearest 10,000 to reflect the uncertainty. The figure of 110,000 should therefore be treated as an estimate.
Annex A sets out the assumptions on which the analysis is based. Bullet 4 explains that, in the absence of data giving the relationship between costs and average predicted need, the assumption has been made that the relationship is linear, i.e. that twice the predicted need score on this measure is equivalent to twice the weekly care costs.
We understand that there is a great deal of variability in both the costs of reablement across councils and the different types of services which may be available in particular localities. In our consultation, “Personal Care at Home: a consultation on proposals for regulations and guidance”, a copy of which has already been placed in the Library, we suggest that a reablement package could include physiotherapy, occupational therapy, installation of telecare or adaptations to the house. The £1,000 per person figure referred to is based on an estimate of 30 hours of care at £30 an hour and an allowance for some equipment. The precise nature of any package would be a matter for local decision, based on an assessment of the person's needs.
Councils currently assess needs and means in reaching decisions on whether or not to provide state funded social care. For people with high needs who are not eligible on the grounds of means, the lack of a private insurance market has meant they may have already incurred significant costs in meeting their own care needs. As part of plans for a national care service, we have been considering a number of proposals which include insurance schemes, so that people with high care needs will not find themselves faced with unexpected care costs.
No estimate has been made on future investment in social care. However, we know that, in order to ensure that a new care and support system is affordable, we will need to be prepared to take tough decisions to ensure that existing resources are targeted on those who need them the most. But we know that the money already in the system will not be enough.
In 20 years' time, we expect there to be 1.7 million more adults needing care and support than there are now and proportionately fewer people of working age to help pay for the funding of that care and support. We will not be able to pay for the care that is needed simply by reprioritising the money we already have. As a society, we are going to have to spend more on care and support if we are to maintain a care and support system that gives older people and disabled people quality of life, dignity and peace of mind about their future care costs.
Free personal care for those with the highest needs in their own home was not considered in the Green Paper because it is a step towards that National Care Service. The Green Paper puts forward fundamental proposals—partnership, insurance and comprehensive—for the National Care Service to reform the system for all adults.
Proposals for reablement put forward in the impact assessment for the Personal Care at Home Bill were also considered as part of the Green Paper.
The impact assessment estimates the first full year costs of extending free personal care at home to those with the highest needs at £537 million. It also estimates the costs of providing reablement services over the same period at £130 million, bringing the total costs of the proposals to approximately £670 million. The impact assessment only covers the period from October 2010 to the end of 2012-13. Estimating beyond this point to 2015, 2020, 2025 and 2030 is problematic because of the uncertainties involved. The proposals here are intended as a step towards a fully integrated National Care Service, at which point a different set of assumptions may need to be applied.
I sent a memorandum to my hon. Friend the Member for Hendon and Chair of the Joint Committee on Human Rights (Mr. Dismore), on 27 November 2009. The memorandum details the human rights implications of the Personal Care at Home Bill. A copy has been placed in the Library.
A sustainable development impact test has not been carried out as part of the impact assessment. The policy will help people to remain living at home for longer where this is what they wish. The environmental impact of the policy is likely to be negligible.
No estimate or assumption of the average lifespan or life expectancy of those who will benefit from the legislation have been made. Costings have been made on the estimated numbers of people meeting the criteria in any one year, with the exception of the costs of reablement and the costs of additional assessment, which are based on the flow of new entrants over the course of a year.
The impact assessment has not attempted to specify the net benefit or a net benefit range owing to uncertainty in estimating a number of specific benefits, that is, the benefits from meeting unmet need, re-ablement and reducing the savings disincentive. This notwithstanding, the areas in which benefits have been quantified, namely those people in highest need who will receive free personal care at home, equity distribution and the extended insurance coverage, justify the proposed policy on cost-benefit grounds.
A one-off transition cost of £335 million is set out in the impact assessment for the first half-year of the policy, from October 2010. Thereafter, we do not consider that there will be transition costs associated with this for local authorities. However, we will be reviewing the impact of the policy after 12-18 months to ensure that it is being applied properly and that there are no unforeseen costs or perverse incentives.