Can equity release help meet the social care challenge?

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It was a real pleasure to speak at the recent Equity Release Council debate – ‘Can equity release help meet the social care challenge?’ at Portcullis House, Westminster on a rather warm afternoon on 9th July.

As we all await the government’s much anticipated Green Paper this autumn, it’s critically important that we both help inform and hold to account the government so that it moves closer to a much needed and sustainable solution to the long term funding of both health and social care.

Given the demographics involved as our population ages, social care free at the point of need is a wonderful aspiration for a caring society, but an economically and politically challenging one given the growing numbers and costs involved. What we must ensure, in any event, is that we deliver a social care system that is better understood and perceived of as fairer than the current system, by the vast majority of the general public, young and old alike. Furthermore, we must be wary that it secures a base funding stream separate from health care, or we run the risk that social care will remain a Cinderella service.

At My Care Consultant we believe social care should remain free at the point of need for the most vulnerable and poorest in our society, but for those that have financial means they should make a contribution that is deemed reasonable, proportionate and without the fear of personal financial ruin at some future point. Whilst a ‘silver bullet’ in terms of a single solution to such a complex matter as social care seems unlikely, a combination of insurance innovation, a cap on total costs, tax incentives and the use of residential property assets (through downsizing and equity release) would seem to have the best potential to deliver a solution that should be acceptable to the majority. Any solution however must first tackle the huge public misunderstanding of the potential cost of care and the likelihood of actually needing it.

It is, of course, not without its challenges and the road to redemption will not be a smooth one. But what we must avoid at all costs is the ongoing search for a ‘perfect solution’ further delaying a ‘better solution’ than that which we currently have. Continuing to ‘kick it into the long grass’ or the ‘too difficult box’ will only mean that at some point our care (and by implication) our health service will collapse – and that point seems increasingly closer at hand!

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