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Lord Dholakia: My Lords, there is a matter that concerns a number of noble Lords. Perhaps I may press the Minister on the matter. According to what he has said, the Government place much importance on resettlement. The governor did precisely the same. Yet the area manager was in conflict with that particular governor.Where precisely do the Government stand in relation to area managers who are in conflict with governors over the running of prisons?

Lord Bassam of Brighton: My Lords, I accept that that relationship is sometimes difficult and challenging, but clearly it must be right that there is a "negotiated" relationship. However, ultimately operational decisions rest with the director-general. That has to be right.

I want to try to go through all the questions and points. I hope that your Lordships' House will bear with me as I do that. The noble and learned Lord rightly asked whether the Government are satisfied that any senior officer directing our policy should combine with it other duties such as director of regimes. The answer is yes, and that is already part of the present director's responsibilities.

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The noble and learned Lord also asked about our attitude towards boards of visitors. It has always been the case that the Government value the independent advice given to Ministers by boards about the way in which prisoners are treated and the state of the administration and premises within Prison Service establishments. My right honourable friend the Minister with responsibility for prisons and probation expects to receive by Easter a report on a review of boards of visitors that he asked Peter Lloyd to undertake, which is aimed at helping make boards even more effective than they are at present.

Furthermore, the noble and learned Lord asked what weight was to be given to future warnings from boards of visitors that there might be problems with relationships in their prisons. Again I want to put on record that we take these matters very seriously and that they are properly investigated. It is open to boards at any time to raise any of those concerns with Ministers and senior Prison Service managers. All issues raised formally by boards are and will continue to be fully investigated carefully by the Prison Service. The way in which issues are raised and reported upon by boards is being considered by the review group with a view to helping boards focus and report more clearly on matters of concern.

Then the noble and learned Lord asked for an assessment of damage done to Blantyre House in the view of the service. The Prison Service accepts that the new governor needs support. He has received that support. That support is being actively provided to regain the important atmosphere of trust in the prison. That comes back to a key point raised by the noble and learned Lord at the outset. As I said earlier, it is regretted that the damage caused in the course of the search has had some lasting impact. But we need to move on. That is the point I tried to make at the outset of my remarks and in summarising where we are now.

The noble and learned Lord asked whether Blantyre House is to be recategorised and whether the board of visitors will be consulted. It is not usual to consult a board of visitors on matters of security policy. That would not be right and I think that the noble and learned Lord will understand that. But the board is welcome at any time to raise this question with the governor. That will always be an important consideration.

I am in danger of greatly running over my time. Noble Lords raised a number of other points. I was asked about planning for the search--I would refute that it started eight months beforehand--and the noble and learned Lord, Lord Mayhew, asked about education matters. I want also to put on record our great regret that the chapel had to be searched in the way in which it was searched. Sadly, however, it has to be said that from time to time chapels within prisons need to be searched. I would reflect that those searches need to be carried out with the greatest possible sensitivity. We will endeavour to ensure that that happens in the future. I was grateful for the comments and observations of the right reverend Prelate the Bishop of St Albans, which will be taken to heart.

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One could say and put on record much more about Blantyre House. It is an excellent institution. It is in many ways a flagship and provides a great service to the community and to the nation. Those points must be properly acknowledged. There is no desire on the part of the Government to undermine the resettlement estate in any way, shape or form. We think that this debate, although perhaps, some might say, a little uncomfortable for government, is an important debate to be had. I am most grateful to all noble Lords who have contributed to it. For those questions that I have not managed to answer as fully as your Lordships would have liked, I shall prepare written responses and try to ensure that those written responses are received promptly, as is my custom. It has been a most valuable debate for me and for the Government and Prison Service.

7.22 p.m.

Lord Mayhew of Twysden: My Lords, I am most grateful to those who, at a not particularly convenient hour, have stayed and taken part in the debate or who have listened to it with such attention. One is very nearly disarmed by the Minister, but not entirely. This has been, as the noble Lord put it, a rather uncomfortable debate for the Government and of course we all want to move on, as he, very understandably, was very anxious to move on. However, the events at Blantyre House have merited the parliamentary scrutiny that has been given, both by the Select Committee and by this House. I hope that the Government will consider very carefully the questions that have been asked. When the Minister writes to me with further answers, perhaps he would be good enough to place those answers in the Library.

Lord Bassam of Brighton: My Lords, I am happy to give that assurance.

Lord Mayhew of Twysden: My Lords, I thank the noble Lord.

In conclusion, I think that the whole House will agree that there is a lot of unfinished business here for the Government and for the Prison Service in remedying the consequences of what happened at Blantyre House on 5th May. We welcome the commitment to resettlement but we will be looking carefully to see how that commitment is translated into practical policies and improvements. With those few words and a reiteration of my gratitude, I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.

Elderly and Disabled People

7.25 p.m.

Lord Ashley of Stoke rose to ask Her Majesty's Government whether they will reconsider their refusal to pay for personal care for elderly and disabled people in residential homes.

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The noble Lord said: My Lords, the purpose of this debate is to criticise the Government's refusal to pay for personal care charges for old and disabled people who are unable to fend for themselves; and to seek a change of policy. But first I want to congratulate the Government on their decision that the National Health Service will meet the costs of registered nursing time spent on providing, delegating or supervising care in any setting.

That decision was taken within the context of the largest ever sustained increase in NHS funding, with its budget growing by a half in cash terms and by one-third in real terms over five years. I believe that the Government deserve more bouquets than brickbats. Those really are very considerable achievements. But they are ruining a good record by refusing to accept the Royal Commission's main recommendation that necessary personal care for elderly and disabled people, wherever they live, should be free. This refusal will undoubtedly cause severe hardship for many vulnerable people. It is indefensible and unacceptable.

We need to be very clear what we are talking about. Personal care is not some little old lady being given a cup of tea and perhaps a nice toasted crumpet by a kindly neighbour while they chat before a blazing fire about "East Enders". Personal care, needed because of illness or frailty, is usefully defined by the Royal Commission. It involves helping with eating, drinking, toileting, washing, dressing and undressing, as well as assisting with mobility and personal safety. Without this personal care, frail people will sicken and die before their time--a bit more slowly, perhaps, than people deprived of vital medicines, but they die nevertheless and with less dignity. Personal care is as necessary for health and well being as medical care. It is preposterous to differentiate, indeed discriminate, between the two.

The Government appear to believe that charging for personal care does not lead to people going without vital services. I find that absolutely incredible. Personal care is costly and I am sure that many people are denying themselves what they need because they cannot afford it.

Although most of us grow old, not all of us eventually require personal care. But many do and it inevitably leads to costs as well as to personal distress and loss of dignity. I share the Royal Commission's view that the risk of that happening and the resulting personal care costs should be shared by us all, just as NHS provision leads to us all sharing medical risks and costs.

In its report the Royal Commission highlighted the plight of people with Alzheimer's disease and recommended that the provision should be the same for those with chronic conditions as for those with acute conditions. With the present policy suggested by the Government, that will not happen because anyone with a cognitive impairment is less likely to be recognised as requiring intensive "nursing" support as currently defined by the Government. Their needs may not be assessed as health needs and they will not be covered. They are unlikely to benefit from the

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Government's willingness to pay for nursing care as others do. A fresh definition of "nursing care" might help but it would stretch the meaning of the English language and prove a bureaucratic nightmare.

Yet the Government and those supporting their policy argue that making personal care free would not be effective. They claim that it would target substantial resources without necessarily improving services; that it would deprive elderly and disabled people of planned improvements in other areas; and that it would help only the wealthy. Those are considerable allegations. To see how misguided that analysis is, let us look at the facts. Currently, personal care has to be paid for by anyone with assets of more than 16,000--soon to be increased to 18,000. Since assets include the value of any property owned, and rightly so, millions of people, many of them living just above the poverty line, will be charged. It is simply not true that free personal care helps only the wealthy. It helps millions of those living just above the poverty line--and in middle England. Furthermore, it is unbelievable that, if properly administered, it would not improve services. I simply cannot believe that, with this change, services would not be improved.

The argument based on robbing Peter to pay Paul being used by opponents of free personal care is an ancient one. It is a convenient way of refusing to accept the costs of changes in society. Of course it is based on the false assumption of a fixed pot of gold. It involves a passive acquiescence in the Government's allocation of funding. Critics of the Royal Commission object to free personal care, but objections are never made to free NHS provision or free education provision.

Today, people's priorities are changing. One in four people become incapacitated. There is now widespread fear among the old and disabled that they will be among the unlucky ones. They will be unable to cope with the consequences and the costs. I believe that the Government need to listen and to reassess their priorities.

Some of the changes in the charging arrangements for residential care proposed by the Government are helpful but, frankly, I am sceptical about the loan proposal. It goes like this: if an elderly person needs permanent residential care, does he or she really want the worry of maintaining a property that can no longer be used and that would be sold on their death to repay a loan plus interest charges? Would the property be rented out? Would the tenants damage it? Would they move out when they were asked to do so? Would vandals break in? This proposal offers no advantage to elderly people or their heirs. It makes sense only if there is a prospect of the person returning home. Short-term loans may be helpful, but not loans over the long term.

I suggest this to the Government. As a percentage of our future national income, according to the Royal Commission, paying for personal care will not be a costly burden. It is a natural step forward in our development of social and health support. It will improve the lives of countless old and disabled people. It will avoid the troubling and complex dispute about

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what constitutes nursing care, so vividly described by Age Concern. It will remove the burden of fear and it will ease personal anguish. It will give vulnerable people a sense of security in old age. I urge the Government to think again.

7.33 p.m.

Lord Rix: My Lords, I have been vexing the Minister with imponderable questions on the subject before us in the debate this evening, and I have the noble Lord, Lord Ashley of Stoke, to thank for a further opportunity to be a nuisance. I should add that the Minister has, as always, been courteous and helpful, but I regret that I am not yet able to add the epithet "convincing".

Those of us who have accumulated more than a few sere and yellow leaves must all declare a latent personal interest in the topic of who pays for what kind of care--especially if we have also accumulated a few pounds sterling. The Government have moved forward in the matters of both capital disregards and payment for nursing care, and it would be churlish not to acknowledge that. Further movement on capital--indeed, the eventual abolition of the capital limit--has been promised in respect of elderly people, though not, I understand, in respect of disabled people below pension age--and thereby hangs a question. On the other side of Hadrian's Wall, they have, as is their right, plans to do things rather differently. Learning from the Scots would be nothing new for the English.

What has not been answered, or indeed proposed for answer, is the argument that a line drawn between what a nurse does and what someone else does is simply not sustainable as a dividing line between modest riches and relative poverty. If non-nursing care has to be paid for, people below pension age with capital resources will exhaust them before they reach pension age. Matters would, of course, be very different if the capital rules for residential care ran in line with the much more realistic capital exemption for inheritance tax. With the rules as they are at present, people whose care needs arise after pension age will rapidly lose their hard-won capital as they pay for what they had thought their taxes and contributions had already paid for. Such older sufferers will inevitably include people who have been carers throughout much of their adult lives and had been hoping to settle some protective resources on their disabled adult son or daughter.

I could say much of what I want to say with reference to people with other forms of intellectual disability or cognitive impairment, groups already touched on by the noble Lord, Lord Ashley of Stoke. I refer to those whose condition means a need for intensive support and some loss of control over their own destinies. But I propose to concentrate on learning disability because it so well illustrates wider anxieties about the nursing/non-nursing dividing line. What I have to say about this group could readily be extrapolated to what could be said about people with Huntington's Chorea, Alzheimer's disease, or other mental and physical impairments possibly caused, for example, by strokes. I accept that the number of

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people with learning disabilities who have substantial personal assets is relatively small. However, if the distinction between nursing and personal care does not work here, I doubt that it works anywhere.

I have huge respect for the high quality professionalism of learning disability nurses. Some made the large institutions a little less awful, despite appalling surroundings and woefully inadequate resources. Some were pioneers of the movement to residential homes in the community. Some, as community learning disability nurses, have held together community services in grave danger of falling apart and have secured--against the recalcitrance of those who seem to want to bar the way--access to mainstream health services for people with learning disabilities. I shall pause there lest the right reverend Prelate accuse me of stealing from Ecclesiasticus the whole of that resonant passage which begins:

    "Let us now praise famous men".

I am leading up to the observation that the introduction of the NHS in 1948 converted care attendants to nurses, and care to nursing. Furthermore, developments since have meant that much of learning disability caring is done by the person best qualified to do it, who may or may not be a nurse. In location A it might be a nurse. In location B it might be someone else with the relevant skills. For example, behaviour management might fall to a nurse, a psychologist or a social worker. I should add that, as we increasingly recognise the wide range of abilities among people with learning disabilities, and the potential of many, I expect to see other people with learning disabilities among those trained and qualified to support those with more severe disabilities.

The complications of trying to maintain the nursing/personal care distinction get worse. Those nurses who entered residential care, often in leadership roles when the hospitals closed, may or may not have maintained their registration as nurses. Some have maintained their registration, but you cannot practise as a nurse in a residential care home even if you are one. So what they do--even if based on nursing knowledge and competencies undertaken by someone registered with the United Kingdom Central Council for Nursing, Midwifery and Health Visiting--will not count as nursing care. There are procedures, such as administration per rectum of medication for epilepsy, which might be thought pre-eminently a nursing function, and may well be done by a nurse if one is present, but which is commonly done by someone else who was originally trained by a nurse.

It seems to me that, despite evident good intentions, the Government have landed themselves with confused principles and inoperable practice. The scheme will fall down every time someone with personal resources is getting care on the nursing borderline. Those who need long-term care and support are not where they are by choice, and we are not arguing about options in their lives but about basic necessities. Moreover, these are necessities over and above the accommodation, food, light and heating and daily living expenses which all of us have to meet.

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The necessities we are debating are the care costs which most of us do not incur because we are fortunate enough to be able to do these things for ourselves.

I do hope that the Government will think again because what I venture to call their interim conclusions are not, in my view, sustainable as a long-term solution. That is, I assume, why our Scottish neighbours are thinking of doing things differently. Improbable as it may seem, I do know people with learning difficulties who are both quite well off and well advanced in years, and whose main carers are not nurses practising as nurses. While the political parties are committing themselves to various visions of the brave new world, it would be good to have a government-led all-party agreement of vision and common sense embodied in the decision to make essential care free.

To return to Ecclesiasticus, such a comprehensive and rational policy would ensure that those responsible for the policy were not among the people who leave no memorial. I am sure that the noble Lord, Lord Hunt, would wish, modest as he is, to be remembered along with his ministerial colleagues for a major advance in social policy. I look forward to his reply.

7.42 p.m.

Baroness Barker: My Lords, I, too, thank the noble Lord, Lord Ashley, for giving the House this most welcome opportunity to discuss one of the most contentious aspects of the Government's proposals to reform health and social care. Noble Lords may have noticed that Clause 48 is one of the shorter clauses in the Health and Social Care Bill. I confidently predict that it will generate by far the most debate. It is timely that your Lordships are discussing what is, in effect, the subject of that clause today, having already seen the text of the Bill and heard the Second Reading in another place a week ago.

In the daily lives of frail older people, distinctions between nursing care and personal care are often fine and not readily apparent. The Government's decision to reject the majority recommendation of the Royal Commission that personal care, as defined in its report, should be universally free immediately begged the question of what the Government mean when they talk of nursing care and personal care. So far, there has been no straight answer and the contortions of Ministers in another place as they try to avoid giving a definite answer to that question is a growing cause for concern.

I hope that your Lordships had an enjoyable recess, particularly the extra week's holiday, which was well deserved after last year's marathon Session. However, perhaps like me your Lordships felt the seasonal cheer evaporate as the Government's list of holiday reading began to emerge. The Health and Social Care Bill, published 21st December; the domiciliary care charges guidance, issued 3rd January; followed swiftly, a couple of days later, by the supporting people charges guidance; the intermediate care guidance, due any day; and the continuing care guidance, promised for

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December 1999, now described as "coming soon". The national standards framework on services for older people must, one fears, be coming by rail, because it was announced months ago. We have been waiting for it for ages and there is no sign of it yet. Altogether, one gets a sense not of joined up government, but a jumble of government, coming towards us.

I list all those publications, the contents of each of which is interrelated, because to do so illustrates the extent of the major changes which are taking place in the fields of health and social care. However, welcome as many of these reforms are to those on these Benches, we are fearful that the whole edifice of social care is being built on a foundation which is wholly unclear. The noble Lord, Lord Ashley, alluded eloquently to the lack of a clear and inclusive definition of nursing care and, consequently, confusion about personal care.

Since the publication of the report of the Royal Commission, there has been a great deal of discussion about the extent to which it is possible in practice to differentiate personal care from health care. Assistance with intimate tasks such as washing, bathing, dressing and toileting have always been a part of nursing care. When a person is unable to perform such routine tasks of daily living, there is usually an underlying physical cause. Moreover, the inability either to attend to one's own personal care or to have it carried out by someone else frequently and regularly would, in most instances, rapidly lead to problems which require medical attention. It is for that reason that many of us on these Benches believe that the Government's rejection of the majority report of the Royal Commission is wrong. Not being able to have a bath for weeks on end is an indignity which no older person should have to suffer for fear that he or she cannot afford the help.

The noble Lords, Lord Ashley and Lord Rix, have stated in great detail that it would be wrong to concentrate, as many in this debate so far have done, solely upon one condition; namely, Alzheimer's. There are many reasons why people need help with personal care, not least of which is simple frailty following a fall or the simple frailty of old age. To single out one condition for an exemption would be to compound one unfairness with another.

Members of this House and Members of another place, along with a range of organisations, including the RCN, CAB, Alzheimer's, Help the Aged and my own employer, Age Concern, have all expressed fear of the potential inequity of these proposals. Two people with identical personal care needs who receive exactly the same help may face entirely different costs--one having to pay and one not--either because of where they live or because the person who carries out that care is or is not a registered nurse. So far, the Government have failed to refute that interpretation of their proposals. If that analysis is incorrect, the Government must explain why, and do so unequivocally now.

There are three reasons why the Government should make an explicit statement about the definition of nursing care and why they should do it soon. First,

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their proposals are open to widely varying interpretations, some of which may or may not be wholly erroneous. For example, there is a widespread assumption that most nursing type care in nursing homes will be free. However, if the care is provided not by a registered nurse but by a care assistant, it may have to be paid for. In fact, it is arguable that a great deal more care may have to paid for in nursing homes where a large number of care assistants are employed and supervised by a small number of registered nurses than in care homes where district nurses provide frequent nursing services. Older people must not be misled into thinking that their care in nursing homes will be free when it will not.

Secondly, a major component of the Health and Social Care Bill is the proposal to integrate health and social services much more closely than ever before in structural terms. There is the potential for small cottage hospitals, in which all care is free, to be redesignated as nursing homes, in which personal care has to be paid for. If that is going to happen, older people need to know.

Thirdly, in another place on 10th January, in response to questions--some from his own Benches--about what is and what is not deemed to be nursing care and therefore free, the Secretary of State said:

    "It would depend on the assessment".--[Official Report, Commons, 10/1/01; col. 1093.]

He followed that up, at col. 1094, by saying:

    "Who can make the assessment for free nursing, other than a nurse?".

There is someone else who can be called upon to make that kind of decision--a judge. That should come as no surprise to the department that was involved in the Coughlan case. It is highly likely that such matters will be determined in court when people who feel themselves to have been treated inequitably inevitably seek redress. Far be it from me to be disparaging about the legal profession--a dangerous pursuit in your Lordships' House, blessed as it is by the presence of so many noble and learned Lords--but I do not believe that courts should be the arbiters of this important matter. For if issues such as these are resolved in court, it will be those with the greatest capacity for articulation rather than those with the greatest need who end up with the support that they need--and that is wrong.

I hope I have explained why, in the absence of an undertaking to fund "personal care", there is an urgent need to define what is "nursing care". In order to begin to resolve the issue, I ask the Minister to include in his response an answer to the following question. The Government's current definition of "nursing care" is set out in Clause 48 of the Health and Social Care Bill. Does that, or does it not, include the cost of the time taken by a care attendant to carry out a task which is supervised or delegated by a registered nurse? If the Minister will cover that point in his reply, your Lordships will be one step closer to ensuring that older people know exactly where they stand and the Government's welcome reforms will be able to go ahead on a sustainable basis.

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7.50 p.m.

The Lord Bishop of St Albans: My Lords, I welcome this debate standing in the name of the noble Lord, Lord Ashley, and thank him for introducing it. I consider it an honour to take part in a debate that he has promoted. I do so out of a passionate conviction that a society's notion of whether it may be called "civilised" is measured by its attitude to the needs of the most vulnerable. But it goes deeper than that: today's wealth and well-being are, for each of us, the result of our forebears' labour. If we forget the enormous debt we owe to the past, we become prey to smug and myopic arrogance.

On grounds of morality, compassion and common humanity, the elderly in our country deserve, and need, the best and most effective care that we can provide. We should be deeply ashamed of the way in which many of our elderly are treated and of the state of some of the psycho-geriatric wards in our hospitals.

I recognise, of course, that this debate is not about hospital provision but about care in residential homes. However, I am trying to place it in the broader context of how the elderly are treated in our society. Therefore, perhaps I may raise three questions.

The first has already been referred to. It relates to the Royal Commission's recommendation that personal care should be free at the point of delivery. When a Royal Commission has laboured long and hard and when it has come up with an equitable and just solution, for the life of me I cannot see why it should be ignored.

So why are the elderly, especially those suffering from long-term conditions such as dementia, to be penalised? Also, I fail to see how, without a massive increase in inspectorial bureaucracy, the definition of what constitutes "nursing care" and what constitutes "personal care" can be made to work. Other speakers have referred to this matter and I make no apology for doing so. If a patient requires feeding, for example, is that "personal care"; or, because that feeding keeps the person relatively well, is it to be classed as "nursing care"? The idea of inspectors with clipboards and watches touring residential homes to determine whether the definitions--which do not yet exist--are being complied with conjures up a picture worthy of Kafka.

Secondly, in common with many others, I look forward to the publication of the national service framework which will for the first time set national standards in relation to care for older people. That is to be welcomed. However, can the Minister assure me that the national service framework will include--or that it already includes, at least in draft form--within its definition of standards the right of elderly people and staff in residential homes to receive spiritual care?

I pay tribute to the thousands of clergy and lay people and to those of all faiths who currently offer daily pastoral and spiritual care to the elderly in the community on a voluntary basis. It would be tragic, not to say immoral, if the national service framework sought to define care purely in material terms and

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failed to recognise that all human beings, not least the elderly, have spiritual needs, hopes and fears which require to be met in compassionate and sensitive ways.

My third point is, I hope, a simple one. Her Majesty's Government are in the process of setting up a national children's fund, with a budget of over 450 million. It will be distributed during this year and the following two years. Its purpose is to,

    "help vulnerable children and young people, listening to their needs and supporting them in breaking the cycle of poverty and disadvantage".

It is a welcome development. But old people, too, are frequently trapped in a cycle of poverty and disadvantage--poverty and disadvantage which never receive the public attention that they deserve, notwithstanding the huge effort of organisations such as Age Concern. I pay public tribute to that organisation and all that it stands for. A teddy bear with an eye-patch brings the money pouring in; people are shown an old person with a stick, and the money stays put. Would it not be wonderful if, for the next three years, the BBC ran an "Old People in Need" appeal, and gave it the kind of energy and enthusiasm that it gives to the "Children in Need" appeal? I raise the question, guessing, sadly, that the response of the BBC governors to the suggestion will probably be negative, because the challenge to change public perception would be thought too difficult--or, in BBC-speak, "not sexy enough". I await with interest any response to the challenge. I am almost certain that the response will be absolute silence.

Will Her Majesty's Government, believing as they do--as I and many others do--in freeing children from cycles of deprivation and poverty--now make available at least a similar sum of 450 million for elderly people? If not, why not? The pattern of administering the fund could be the same--that is, it could be administered by community foundations and local charities. Again, I want to honour and pay tribute to all the community foundations I know which do an outstanding job. If that fund could be put rapidly into place, it would do much to raise hope among carers who work with the elderly. It would be another signal from the Government that older people should be given by the nation the dignity and respect that they so richly deserve.

7.59 p.m.

Lord Joffe: My Lords, I, too, should like to express my appreciation to the noble Lord, Lord Ashley, for raising this important issue, which is of such concern to many elderly people and their families. It is with regret that I do not support the noble Lord's Question, as it is clear that much pain is being caused to many elderly and disabled residents by the present arrangements.

The noble Lord, Lord Lipsey, and I were co-signatories to the dissenting report by the Royal Commission on long-term care. Unlike the majority report, we did not recommend that the burden for all personal care should come out of public funds, for reasons that I shall touch upon later in my speech.

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In considering the Question posed by the noble Lord, Lord Ashley, it is of critical importance to note that the Government are already paying, and have agreed to continue to pay, for all or some of the personal care of 75 per cent of the elderly in residential homes. These 75 per cent are the residents who cannot afford to pay for care themselves. In practice, Britain has a limited form of social insurance. Everyone is insured against not being cared for because they will always be provided with care free if they cannot afford to pay for it themselves. Accordingly, the Question tabled by the noble Lord relates only to the 25 per cent of elderly people in residential homes who can afford to pay for their own care because they have assets in excess of 16,000.

In arriving at a decision on free personal care for all, regard has to be paid to the unequivocal statement made by government in their response to the Royal Commission's report. That response states in paragraph 2.6 that making free personal care available to all would consume most of the additional resources they plan to make available for older people through the NHS Plan. I regret that I do not agree with the noble Lord, Lord Ashley, that the additional cost is not so high. In practice, the additional cost of providing free personal care to the 25 per cent of residents who can actually afford to pay for it themselves is 1.1 billion initially, rising to 6.4 billion in the year 2050. Indeed, if government accepted this proposal, it has to be remembered that what we would be talking about in effect is simply the transfer of 1.1 today to the public purse of a burden presently borne by those residents who can afford to pay for their own care.

Once there are only limited funds available, the question of how best to use them raises the issue of priorities. In our dissenting report we concluded that there are at least two higher priorities than free personal care for the 25 per cent of elderly residents, some of whom are wealthy and all of whom are able to pay, either fully or partially, for their own personal care. The two priorities were, first, providing an adequate level and quality of personal care for the elderly who are unable to pay for it themselves; and, secondly, the provision of extra support for the millions of informal carers.

From the evidence that we heard at the commission, it was clear that the amount and quality of care being provided was inadequate in many areas due to a shortage of funds. In this regard, it is instructive to study the evidence of Age Concern, the organisation that exists for the purpose of protecting the interests of the elderly. In its final paper to the Royal Commission, it unequivocally stated:

    "However, no matter what the funding or administrative system, the heart of the current problem is inadequate funding. However financed ... more money must be set aside for those who will need care as they age. The result of the failure to take account of this and to plan accordingly is damaging short termism".

Evidence to the same effect was given by the local authorities, which raised the issue of the rationing of services to elderly people as a result of the shortage of funds which in turn led, understandably, to the limited

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available funds being applied to those with the severest needs, thereby depriving those with lesser, but very real needs, of the care that they required.

I move on to the second priority; namely, informal carers. Twice as much care is provided informally as formally. But for this provision of care by children, spouses, relatives and friends, the burden on public funds would increase by as much as 70 per cent of the current cost. A decline in informal caring has long been predicted, due to more marital break-ups, more mobile lifestyles and the increasing number of women in employment, among other factors. If there were a reduction in informal care of only 20 per cent by the year 2051, it is estimated that it would lead to an increase in public expenditure then of 3.8 billion.

The strain on carers, many of whom are themselves elderly, is almost unbearable in many cases. Many carers say that they are at the end of their tether; and that, if they are not supported, they will give up. Informal carers, who sacrifice so much to care for the people they love desperately, need additional support and particularly respite care. They deserve it on the grounds of natural justice. But, as it happens, if they do not get it and stop caring as a result, the cost of replacing them with paid care will fall on government. I suggest that better care for the elderly who cannot afford to pay for it and more support for informal carers are higher priorities than personal care for those who can afford it.

In conclusion, I should like to make it clear that I am not saying that there is no case for free personal care for the elderly who do not qualify for it at present. Obviously, using up their lifetime savings causes severe grief and anguish to elderly people, especially when that involves selling the homes in which they have lived for much of their lives and which they had hoped to pass on to their heirs. If there is additional funding for the care of the elderly, it would be appropriate for consideration to be given to paying for personal care for all. However, such a claim for additional funding would need to be weighed against the natural desire of taxpayers to keep public spending low and against all the other unmet calls on public funds to determine where in the hierarchy of priorities it fell.

8.7 p.m.

Lord Lipsey: My Lords, I am sorry that the vagary of the draw tonight has given the House Tweedledum followed by Tweedledee. However, I am privileged to follow the noble Lord, Lord Joffe, in this debate. We spent many agonised hours--I do not exaggerate--as members of the Royal Commission deliberating over these issues; indeed, hours, days and nights. It is not easy to sign a minority report, especially when, admittedly, one knows that much distress is being caused, as outlined by the noble Lord, Lord Ashley. Much distress is being caused to elderly people who thought that everything would be paid for but who now find that that is not so. As I say, this was not an easy route to follow. Nevertheless, as the debate has progressed and the Government's package has been

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unveiled, I have become even more strongly of the opinion that we did the right thing and that our recommendations are correct.

We are grateful to the noble Lord, Lord Ashley, for raising this issue and for his moving opening speech. He rightly stressed the virtues of free personal care, and I disagree with little of what the noble Lord said. However, some of the vices have also to be recognised. The noble Lord, Lord Joffe, quoted the figures from the Royal Commission as rising to 6 billion by the middle of the next century. But, to my mind, that is a vast underestimate. I speak as an economist rather than anything else in this respect, but if you cut the price of something to zero people will consume a great deal more of it.

If care were free in residential homes--and we may get a controlled, or uncontrolled, experiment on this in Scotland, if they continue along the unwise route that they have taken--many people who are being cared for at home at present with the aid of their families would move to residential homes, or nursing home care, and that is where they would spend the rest of their lives. That is not what they want. It is an unfortunate side-effect of a well-meant policy.

Further, where will the money go? We cannot get away from the fact that for some of us public spending is very much an instrument to help the worse off. However, none of the extra spending on personal care would help the worse off. Some 70 per cent of people who receive the care at the moment have it paid for by the state. Therefore, only the better off 30 per cent would benefit from the change.

I do not for a moment say that those people are wealthy. But they are well above the average in terms of wealth. They comprise the top 30 per cent. Indeed, in most cases, their heirs will benefit from the measure as, on average, the elderly people receive the care for two years. The measure will enable these elderly people to leave their homes to their children. That is a perfectly reasonable thing to want to do. I do not wish to do it, but it is a perfectly reasonable thing to want to do. If one wants to do that, one can prepare for that step now by insuring oneself privately. No speaker in the debate has so far mentioned that before Christmas the Government announced, following great pressure from some Members on these Benches, that long-term care products to enable better-off people to insure themselves would be properly regulated so that snake oil salesmen did not sell them to vulnerable people. That is a tremendous breakthrough and the Government deserve credit for that, even if it took them some time to achieve it.

My next point arises from the comments of the noble Baroness, Lady Barker, whose comments on these issues I listen to carefully. She said that it is a scandal that many old people cannot take a bath for weeks. It is a scandal. That is why we do not make personal care our priority. It is scandalous that under the present system the most disabled older people living at home receive four hours' care per week. That is why these tough decisions about priorities and resources have to be made.

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I welcome the fact that the bulk of the money the Government are making available will be allocated to those people. It is 900 million. It is not small beer. However, I regret deeply that the Government have "wrapped up" the money under the title, "intermediate care" which means nothing to anyone. However, in practice, it means those extra aids and adaptations which enable a person living at home to get in and out of the bath. Therefore he or she does not spend weeks without taking a bath. Intermediate care covers the period between someone's discharge from hospital and their return to their own home where they want to be. Intermediate care enables them to be properly cared for and looked after. It ensures that they are not shoved into a nursing home with no possibility of exit or improvement.

When we compare the Government's package with the free personal care package proposed by the Royal Commission, I should point out that the Royal Commission specifically rejected the proposal put forward by the noble Lord, Lord Joffe, and myself that no elderly person should ever again have to sell their home during their lifetime to fund their care. Under the Royal Commission's proposal, people would still be forced to sell their homes to pay for their care.

Carers were eloquently referred to by the noble Lord, Lord Joffe. More money is made available for them--I accept that it is not enough--in the Government's package. I am afraid that they were dealt with in what I can only term an offhand way in the Royal Commission's report. Of course it understood the value of carers, but, fixated as it was on this single holy grail of free personal care that would solve all our problems, carers were brushed aside. However, they are catered for in the Government's package.

I refer to free nursing care. I understand the problems of definition and that the Government's definition is not the same as that of the minority group. I should not be surprised if the Minister does not have cause to regret that he did not adopt our simple definition but instead entered the rather complex waters that will be discussed at length in this House over the next few months. However, I welcome free nursing care which will deal with the worst anomaly in this area. Nothing will deal with all the anomalies. Free personal care will not do so. Why is it right that if an elderly person needs help with eating that should be paid for, but if they need help to cook their food they should have to pay for that themselves? That is the Royal Commission's recommendation. It is at least as anomalous as the situation we are discussing.

Therefore free personal care does not get rid of all the anomalies. One creates new ones to replace the old ones. One pre-empts the resources that should be allocated to better conditions and better care for old people. I could not agree more with every word that the right reverend Prelate said. To my shame I had not thought much about the state of elderly people in our country before I sat on the Royal Commission. Much of what I saw shocked me. However, it is because I believe passionately that we must do more for older people, and that in particular we must do more for

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poorer older people, that with great regret we had to reject the proposal for free personal care in favour of a package in the minority report which I am delighted to say is to a large extent reflected in the response of the Government.

8.15 p.m.

Baroness Greengross: My Lords, I too welcome the debate initiated by the noble Lord, Lord Ashley. It is a great privilege to take part in a debate with so many speakers who have enormous experience and understanding of the complex issues involved.

However, I must start by expressing disappointment that the Government have moved so slowly to resolve this difficult issue. The Leeds case was first considered by the health ombudsman in 1993 or 1994, but, apparently, we are still a long way from a clear definition of nursing care. I acknowledge the hard work carried out by the Minister, his colleagues and officials as well as that of the Royal Commissioners. We must acknowledge that this is a complex matter.

However, there is a worry that the Department of Health does not seem to be carrying with it many of the organisations which have a great amount of expertise in this field, including the charity which I headed until last summer, Age Concern--I thank the right reverend Prelate for his kind words about that organisation--the Methodist Homes for the Aged and the Abbeyfield Society. That is both worrying and sad.

When the NHS Plan and the Government's response to the Royal Commission were published in July 2000, I asked a supplementary question of the Minister about the definition of nursing care. I was greatly encouraged to note that the Government's response to the Royal Commission stated that,

    "in future, the NHS will meet the costs of registered nurse time spent on providing, delegating or supervising care in any setting".

I thought that that would mean that we could go beyond what most people consider to be basic nursing provided by a nurse. That is what it appeared to mean. I am now worried to learn that the Health and Social Care Bill, which is before the other place, offers what seems to be a much narrower definition of nursing care--indeed, I gather that it does not define the NHS's responsibilities at all but merely debars social services from purchasing such care. I fear that the Bill will need radical amendment in this House to determine how nursing care will be more broadly defined to include those elements of care delegated or supervised by a nurse. This is what older people and their relatives and carers desperately need to hear. After a decade of muddle, with worrying and often distressing consequences, this debate offers us an opportunity to rehearse our arguments so that we can get this matter right once and for all when the House considers the Health and Social Care Bill.

I refer briefly to three other matters. The first concerns capital limits. I especially welcome the three-month time-limit before a person's home is included in the means test. Given that people should only be in residential care when they cannot cope at home any longer--that is, after all, the point of the community

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care policy--and that this usually happens in the last year of their life, perhaps the period ought to be extended to at least six months. That would make a great difference as it takes a long time for the necessary arrangements to be made for the transition to end-of-life long-term care. The capital limits that "bite in" thereafter remain rather low. It might have been better if the Government had been a little more radical in that regard. Perhaps it might be reconsidered. Where does the figure of 40,000 homes--that is over a hundred every day--being sold to pay for care home fees come from?

The regulation of long-term care insurance is essential. I pay tribute to the work of the noble Lord, Lord Lipsey, in that respect. It is essential that that is undertaken quickly.

Lastly, I refer to long-term care home fees. About four years ago, when I headed up Age Concern, we undertook a survey with the Royal College of Nursing to estimate the costs of nursing care in a nursing home. It concluded that the cost was around 150 per week. At the time some nursing homes were charging over 350 per week. That would have meant that self-funders would still have had to find about 200 per week if the nursing element of their care was funded by the state. This is now to happen. I have not seen any figures on the estimated cost of personal care per person in long-term care, but I find it difficult to believe that it will reduce the overall figure much--except for those in residential care who would benefit. In other words, it will still be expensive for the self-funders to pay for the hotel costs of their care. Even the cheapest bed and breakfast today costs 20 per night or 150 per week. Thankfully, the quality of care in long-term care homes is rising, and will rise further once the key recommendations of the Fit for the Future proposals are implemented. Some modern care homes are akin to mid-range hotels which would charge about 35 per night or 250 per week. So quality comes with a price. I believe that we must all be more honest about this, so that once and for all we can be clear about what we as a society and in particular our older population, the families and carers, can expect.

8.22 p.m.

Lord Clement-Jones: My Lords, I add my congratulations to the noble Lord, Lord Ashley of Stoke, on raising this crucial issue. I found the case he made utterly convincing. It was backed up by a number of other noble Lords who raised vivid illustrations of the problems with the Government's policy. That said, however, it has been a privilege, as the right reverend Prelate made clear, to take part in this debate. While profoundly disagreeing with the remarks of the noble Lord, Lord Lipsey, nevertheless I fully recognise the conviction and force underlying what he said. In the view of my party, the Government's free nursing care plans set out in the Health and Social Care Bill are fatally flawed. They set up an artificial and unsustainable distinction between nursing and personal care. As many noble Lords have made clear, that is unjust. It means that many people in nursing homes or at home will still be means tested

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for care such as being dressed, bathed or washed, which they would not pay for in an NHS hospital. That will be exacerbated by the continuing low level of the means-tested threshold.

No one has a brief for the current regime. The system is complex and entitlement is unclear. Who pays for care is dependent on for whom and where the care is provided. My party found the key recommendation of the majority report of the Royal Commission--that personal care should be free at the point of use--highly persuasive and we regard this as a key priority for future expenditure.

People in long-term care incur three kinds of cost: first, living costs; secondly, housing costs; and, thirdly, personal care costs which arise from frailty or disability. Living and housing costs are legitimate items which people should generally be expected to meet themselves. Some of those costs may fall to be met through income maintenance but they are costs that fall on us all and reflect personal choices and lifestyles. The straightforward living and housing costs of staying in residential care should remain the responsibility of the individual, subject to means testing.

However, personal care costs fall heavily and unexpectedly and are beyond the control of the individual. For that reason we believe that personal care costs should be exempted from means testing in all settings and instead based on an assessment of need. The Royal Commission defines personal care as the care needs that give rise to major additional costs of frailty or disability associated with old age.

Critics of the commission's proposals, including the two distinguished commission dissenters, stated--as they have today--that the changes proposed by the Royal Commission would give rise to an undue and massive increase in demand. But the commission makes it clear that an exemption from means testing does not mean a demand-led system. A proper system of assessment of need of the level of stability and dependency will be essential. In addition, cost control could be achieved by the determination of a maximum figure for personal care costs. Any costs exceeding this level would continue to fall on the individual and be subject to means testing. Between 100,000 and 125,000 people in residential settings would benefit from excluding personal care costs from the means test.

Personal care costs in the domiciliary setting should also be exempt from charging. Therefore, the perverse incentive mentioned by noble Lords would no longer exist.

We are not wholly negative on these Benches about the Government's plans. One recommendation, for the granting of a three month breathing space for people admitted into residential or nursing homes before they are subject to the means test, is highly welcome. However, in our view overall the Royal Commission majority recommendations offer a humane and practical formula for addressing the funding of long-term care. Personal care should be free on the basis of assessed need. Location should not

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matter when people need intimate care such as bathing, dressing or feeding. That care should be free. That means that the personal care element of non-residential care should also be free.

The public require a system that promotes dignity and independence by providing the support and help that people need when they need it and in the way that suits them best. As regards the arguments made by the minority members of the commission and the Government themselves on resources, in so far as we believe in a health service free at the point of need, paid for from general taxation, then it must be right to pay for all personal care after an assessment of need no matter where it is delivered. We should accept the obligation to fund it.

Furthermore, as a number of noble Lords have pointed out, the proposed definition of nursing care is far too narrow. The proposed definition of nursing care will leave care home residents unclear about what they will have to pay for. The management and delivery of care involves a variety of nursing and care staff. Who performs what task can vary depending on a person's state of health, as a number of your Lordships pointed out. The bureaucracy involved in recording billable care will be formidable and costly. Who will foot the bill? Will it be the individual, the care home manager or the NHS?

Vulnerable old and disabled people may have to pay for care which should be free. If tasks such as dressing ulcers, changing a catheter or skin care are delegated to a care assistant, they may well have a price tag attached but they will be free if performed by a registered nurse. A definition of nursing care based on who performs the task rather than on what the task involves is clearly wrong. As my noble friend Lady Barker and the noble Baroness, Lady Greengross, pointed out, taken together with the provisions of the Health and Social Care Bill, and Section 48 in particular, by debarring social services from providing nursing care without placing a clear duty on the NHS to do so may well make matters worse for older people than they currently are.

Fifteen major voluntary organisations involved in the care and representation of older people have condemned the Government's plans on nursing care. The Scottish Executive is seriously considering moving down a different track and one which is much closer to the approach my party would wish to see in England and Wales. I am pessimistic at this stage, but I hope that the Government will reconsider. I believe that the cause of full funding of personal care is a popular one among the British public and that they will live to regret their current stance.

8.29 p.m.

Earl Howe: My Lords, this has been a valuable debate. The noble Lord, Lord Ashley, has taken us through what many of us agree are the key issues on a topic that, as he said, is of concern to a great number of elderly and disabled people. I welcome the opportunity to discuss these matters for the first time in any depth since the publication of the NHS Plan last summer.

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The Royal Commission on Long-Term Care concerned itself, broadly speaking, with two main tasks. The first was to identify mechanisms for the sustainable long-term funding of good-quality care. The second was to arrive at a fair determination of how the costs of long-term care should be shared between taxpayers and the individual. In a society made up of rich and poor, in which people's expectations of the welfare state and of residential care vary and are changing constantly, the commission's job was formidable.

The overriding criticism of the current funding regime is surely its manifest unfairness. Despite the significant increases in the means-test threshold over the years, large numbers of people are still obliged to sell their homes and other assets to pay for nursing care in their old age. Such people often feel cheated. In many instances, they have paid high taxes throughout their working lives in the expectation that by doing so they would become entitled to state-funded care once they were aged and infirm. Others, by contrast, who have not saved for their retirement at all, have all their costs paid for them by the state.

However, as we have heard this evening, the unfairness runs wider than that. Whereas nursing care is provided free in hospitals, at home and in residential homes, it has hitherto been means tested in nursing homes. That anomaly has been accentuated by the expansion of the private and voluntary nursing home sector, particularly over the past 10 years.

We waited quite a long time for the Government to respond to the Royal Commission. Nevertheless, when it came, the response contained some welcome provisions. In my judgment, the two most important are the decision to provide free nursing care in nursing homes and the three-month disregard of a person's home when he or she first enters the care system. Free nursing care will end the glaring anomaly to which I have just referred. I am sure that the disregard of a person's home will be of major benefit not only to patients, who should not have to take difficult decisions about the sale of a house at a time when they are especially vulnerable, but also to the NHS. All too often, elderly patients of modest means are unwilling to be discharged into intermediate care because of fears that they will not be able to afford the cost.

The conundrum that divided the Royal Commission, and to which the noble Lord, Lord Ashley, has drawn our attention this evening, is whether the Government should have gone further and made personal care, as well as nursing care, universally free of charge in care homes. We have yet to hear the Minister's response this evening, but I have to tell the noble Lord, Lord Ashley, that I find it difficult to take issue with the reasoning advanced by the Government in support of their decision. The dissenting section of the Royal Commission report makes a compelling case. Surely what matters to patients is that those who cannot afford to meet the cost of personal care should have that cost met for them.

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Much has been said this evening about the shame that is cast on a society that deprives elderly and disabled people of personal care, but already three-quarters of those in care homes have some or all of their personal care costs met by the taxpayer. Directing more public money towards relatively well-off people would neither enhance the service provided nor benefit the least well off, whom we all want to help the most. I strongly agree with all that the noble Lord, Lord Joffe, said about the value of informal care and the folly of doing anything that might discourage it.

There is, of course, a practical issue of how to distinguish nursing care from personal care. I accept that it is likely to prove problematic in many cases, and it will be no good, either, if different people around the country are subject to different rules. Any methodology that is devised for assessing people's needs must be applied universally.

However, although it may be difficult to devise a fair methodology, it certainly should not be impossible. As the dissenting note in the Royal Commission report pointed out, as did the noble Lord, Lord Lipsey, in his excellent speech this evening, there are difficulties of definition wherever one draws the line between state and privately funded care, not least when one looks at the line drawn by the Royal Commission's majority report.

Nevertheless, I should be grateful for the Minister's reassurance that the Government are alive to the danger of creating perverse incentives. I have in mind the point made by Christine Hancock of the Royal College of Nursing; namely, that large amounts of nursing care are in practice delegated to care assistants. It would be undesirable to discourage such delegation merely because a care assistant rather than a registered nurse was likely to deliver the service in question. We need clarification of what is meant by paragraph 2.9 of the NHS Plan, volume 2, which refers to the NHS meeting,

    "the costs of registered nurse time spent on providing, delegating or supervising care in any setting".

The Health and Social Care Bill, currently in another place, leaves the NHS's responsibilities undefined.

Two things above all are essential for the delivery of a fair assessment of a patient's care needs: professionalism and promptness. There have to be an adequate number of nurses, suitably trained, to carry out assessments in a timely manner.

If I have a criticism of the Government, it is not the same as that made by the noble Lord, Lord Ashley. My main concern is that Ministers have done far too little to address the real problem associated with long-term care, which is how to encourage future generations to make provision for themselves, and, as far as possible, to reward thrift. The note of dissent in the Royal Commission report recommended that the Government needed to introduce,

    "a genuine public-private partnership in the funding of care, with private savings and private insurance making their contribution".

That section outlines some interesting suggestions for enhancing private savings in that area. So far, I have not gained the impression that the Government are

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particularly exercised about those issues. That is a great pity. To the extent that the state explicitly disclaims responsibility for funding personal care, it has a duty to encourage individuals to invest in their own future and, in so doing, to promote greater self-reliance. My party will announce its proposals on the issue during the next few weeks, but I should be interested to hear a little more of the Government's thinking.

The Government's response to Sutherland makes it clear that there is a balance to be struck between private and state funding of long-term care. However, that balance should not be a short-term fix. It ought to be struck for the long term, so that people can be confident that it will not change. One of the key words in the Royal Commission's remit is "sustainable". That word alone should give pause to those who call for universal state funding of personal care. The Government have gone part, but, so far, not all of the way towards creating a sustainable system for funding long-term care. My message to them is that this is unfinished business.

8.38 p.m.

Lord Hunt of Kings Heath: My Lords, once again the House is indebted to my noble friend Lord Ashley for raising a very pertinent issue. It is clear from the contributions we have heard tonight that it may entertain us for a few moments during the passage of the Health and Social Care Bill, whenever it comes to your Lordships' House.

There can be no question but that the issue of the future care and support for older and disabled people in residential homes is very important. However, so too is the more general holistic issue of the support that we give to such people. In considering the Government's response, I reiterate that it is not simply a question of free personal care and free nursing home care. We have to look at the issue in the round and in the general context of our policies to improve the support and rehabilitation that we give, particularly to older people, but also to disabled people.

As the noble Earl, Lord Howe, remarked, the Royal Commission was established to look at options for a sustainable system of funding for long-term care. I believe that the commission went about its work in a very consultative manner. It met many people, and it would be fair to say that it received a strong message that improvements in quality and choice of care and fair access to care were at least as important as funding issues. We took that to heart in our own decisions. We know that most older and disabled people prefer to remain independent in their own homes. Our investment in intermediate care and related services, to which I shall return in a moment, is intended to ensure that that happens.

In addition to intermediate care, shortly we shall also publish a national service framework for older people. That will set very clear and consistent standards for the health and social services which older people use. I was most interested in the remarks of the

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right reverend Prelate in relation to the spiritual needs of older people. I do not know the answer to the question but I shall certainly find out because I believe that it is particularly apposite. Certainly, I very much respect the contribution which the Church makes, for example, in the National Health Service to the hospital chaplaincy service, and, indeed, to other faiths and religions. I shall wish to pursue that point.

Clearly, our response to the Royal Commission must be seen in the round and not simply in terms of our decision in relation to the specific question of personal care. Of course, the Royal Commission recommended that personal care should be available after assessment according to need and paid for from general taxation. Since we responded to that report, we have made it abundantly clear that we are committed to an unprecedented investment in improving services for older and disabled people. However, we do not believe that making personal care universally free would represent the best use of those resources. That remains the Government's position and it is embraced within the NHS Bill now being considered in another place.

No matter how eloquent the speeches that we have heard tonight, I have not heard any convincing argument as to why this particular element of free personal care should be put on a pedestal as if it were the magic wand which will bring about the cure to so many of the issues we face. As my noble friend Lord Lipsey, the noble Lord, Lord Joffe, and, indeed, the noble Earl, Lord Howe, pointed out, at present personal care is provided on a means-tested basis. Three-quarters of residents of care homes receive some or all their personal care free. Four hundred and fifty thousand older people are in nursing and residential care homes in the UK, and approximately 125,000 of them pay all or some of the home fees.

The Royal Commission assumed that personal care costs other than nursing care costs, whether in residential or nursing homes, were approximately 120 per week. Approximately 600,000 older people receive some care from social services in their own homes. Almost 90 per cent of that care is funded by social services but users are charged on a means-tested basis. Where charges are made, the costs are often subsidised by social services.

In putting together that information, the Royal Commission estimated that free personal care at home, which would not include meals or domestic help, would cost an extra 150 million across the UK. That, together with the cost of personal care in residential care homes, would demand an enormous investment--over 1 billion for England as it arises at present. However, as the noble Lord, Lord Joffe, said, not one extra older or disabled person would have received any extra care or support to remain independent as long as possible; nor would such a system have benefited the least well-off, for whom all or some personal care costs are already paid.

Therefore, it would keep in place essentially the same inadequate services which older people themselves criticise. It would not allow us to develop

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the wide range of services which we should like to see in place in order to meet the health and social care needs of older and disabled people. As my noble friend Lord Lipsey said, it could well have perverse incentives. I accept that the noble Lord, Lord Clement-Jones, made a brave attempt at arguing that that would not occur. None the less, it is a substantive point that free personal care could produce the wrong incentives as regards the way that people look towards state support in the future.

As do other noble Lords, I very much appreciate the welcome given by my noble friend Lord Ashley to free nursing care and the removal of the major anomaly which exists at present. Comment has been made tonight about exactly what that means. I can say to noble Lords that, subject to legislation, from October 2001 everyone who needs the care of a registered nurse will receive it, paid by the NHS. That includes registered nurse time spent on providing, planning, delegating, supervising and monitoring care. It will also meet the costs of specialist equipment used by those nurses. We believe that that change will benefit approximately 35,000 people in nursing homes who currently pay for their own care.

I understand the point made by the noble Baroness, Lady Greengross, about the other costs which may be involved. Nevertheless, the arrangement will mean that people will save up to approximately 5,000 of the annual fees for a year's stay in nursing homes. I believe that that is significant.

I turn to the issue of definitions. The noble Baroness, Lady Barker, talked about a list of goodies that has come out over the past few weeks. I can assure her that there are many more goodies to come in the next few weeks. I do not believe that she was present during our debate yesterday on the National Care Standards Commission. However, I can assure her that the regulations and standards, on which we are keen to consult and receive feedback, will be produced in three batches over the next few months.

I turn to the issue of assessing the registered nurse input to care. I believe that the noble Earl, Lord Howe, is right: yes, issues will arise which will need to be sorted out. However, I do not believe that it is intrinsically impossible to arrive at a consistent definition. From previous debates, noble Lords will know that we are working with the RCN, the Alzheimer's Disease Society and other key stakeholders to ensure that we arrive at an assessment process which will be understandable and consistent.

I also say to the noble Earl, Lord Howe, that I am alive to the issue which he raised in relation to perverse incentives. With regard to consistency, we shall also be informed and helped by the work of the National Care Standards Commission in relation to regulations, minimum standards and the regulatory process. I believe that that will encourage not only a higher standard of provision within nursing homes but also much greater consistency than we have achieved in the past.

I say to the noble Lord, Lord Rix, that I always listen with great interest and care to the points that he raises about the needs of people with learning

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disabilities. I want to assure him that the assessment tool that we shall develop will ensure that aspects of care which are important for learning disabilities will be taken into account when making assessments for nursing care.

Several noble Lords raised the question of Scotland. I must say--and I acknowledge the joys of devolution in so doing--that the First Minister announced that the Scottish Executive will review the decision not to implement the recommendation in the Sutherland report that personal care should be free. I do not think that a final announcement has yet been made, but we shall all look with great interest to see what Scotland decides to do. Of course, that is a matter for Scotland. When comparing what we do in England with what is done in Scotland, one has to consider the matter in the round and take account of the enormous improvements we shall make in care generally through the national service framework and in intermediate care before obtaining a balanced picture.

The noble Baroness, Lady Barker, was, as ever, robust on this issue. She asked whether people might have to pay for intermediate care. I accept that that is an important matter. Clearly, any service that is provided by the NHS is free. When councils are responsible for services that are similar to those offered through intermediate care, they have some discretion about whether to impose charges. However, the department believes that all intermediate care should be free at the point of use and should be funded from pooled budgets. I also assure her that we shall presently issue a circular that will contain guidance for councils about those matters.

The noble Lord, Lord Joffe, and the noble Earl, Lord Howe, raised the question of carers. It is important to consider that in conjunction with what we are doing for older people and disabled people. During the past few years we have made great strides in giving extra support to carers. The package that the Secretary of State for Social Security announced, involving 5 million extra support for carers over three years, is one such issue. There are many other ways in which we are seeking to support carers, including funding of the Carers National Association, improved information services, the draft long-term charter and Care Direct, as well as the carers' special grant, which has been extended from three to five years. We are determined to increase whatever help we can to carers because the role that they play is crucial.

The noble Lord, Lord Rix, and the noble Baroness, Lady Greengross, welcomed the raising of the threshold for capital assets, which is important. The noble Earl, Lord Howe, also welcomed the property disregard for the first three months. I agree with him that that allows valuable time for the person and his or her family to take stock of the situation. It gives them a breathing space to make decisions about financial and other arrangements, and has been warmly welcomed.

In addition, we said that councils will get an extra 85 million over three years from 2001 as a ring-fenced special grant to encourage them to offer deferred payment arrangements whereby councils place a legal

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charge on homes that they recoup at a later date. That means that, following admission to permanent care, people will not be forced to sell their houses during their lifetime against their wishes. That is an important development.

My noble friend Lord Ashley asked about short-term loans. It is perhaps worth pointing out that the Royal Commission rejected loan schemes because of what it regarded as a high initial outlay and the fact that local authorities would be involved in funding transaction costs and paying interest. It also said that the arrangement would be complex to establish and administer and that local authorities would be left with a complex burden of assets. As I said, the Government's decision to pay an additional 85 million to local authorities as a ring-fenced grant in relation to deferred payment arrangements is a significant advance.

Time presses on, but, if the House will allow me, I want to mention the developments in intermediate care. They are the crux of this debate. We believe that instead of paying for free personal care for everyone, the 900 million that we will make available for intermediate care will be much more effective because it will be developed and invested in preventive and rehabilitative services, such as community equipment services, as my noble friend Lord Lipsey said. It is aimed at maximising people's independence following a period in hospital or at providing care that re-establishes independence and prevents admission to a care home.

We are already seeing the effects. I have been impressed by some of the developments in intermediate care. By 2004 we estimate that the new investment will help an extra 130,000 people. It is a

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question of priorities. But I believe that that is a better place to put that 900 million. In the long term it will produce many more effective results.

I pick up the points made by the noble Earl, Lord Howe, as to what can be done in the long term to encourage people to provide for themselves in old age and also as to what can be done in partnership with the private sector. He will be glad to know that a Treasury-led committee is looking at the whole issue of long-term private/public contribution to care. I am sure that the outcome will prove to be interesting and informative to the wider debate.

In summary, as ever, governments are faced with choices as to priorities. I understand why noble Lords feel that making personal care free would be a good step to take. But at the end of the day the argument the Government put forward is that the additional 900 million will be much more effectively spent in relation to intermediate care. The noble Earl, Lord Howe, does not like that phrase. But it is surely the best way to ensure that as many old and disabled people as possible are rehabilitated and enabled to live in their own homes. That is why we believe we have taken the right decision and that, in the end, the public and those who require our support will be encouraged and helped by the services we now intend to develop.

Barclays Group Reorganisation Bill [H.L.]

National Australia Group Europe Bill [H.L.]

Presented and read a first time.

        House adjourned at three minutes before nine o'clock.

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