How We Fund Care Of The Elderly Is A Time Bomb We Must Defuse

Funding is the key, and while the commissions and studies launched by governments on both sides of the Border have been well-intentioned, they have not produced the concrete measures needed to fund the soaring cost of providing care for the elderly, many of whom require specialist full-time care for conditions such as dementia and Parkinson's disease.

In England, the coalition government has just launched an independent commission to consider how elderly care should be funded in the future. The measures being considered include the introduction of a highly controversial "death tax" or a voluntary insurance scheme.

In Scotland, we have had free personal and nursing care for the elderly since 2002. The policy was a bold move and has supported thousands of elderly people; however it is not a panacea. Last year, the cost rose 11 per cent to £358 million, raising serious questions about the state's ability to continue supporting an ageing population. The policy is unsustainable and will have to change, given the current demographic trends and pressure on public sector budgets.

According to the latest estimates, one in five of the UK population will be over 65 by 2026 and the number of people aged over 85 is expected to double. Over the next 20 years, there will be another 1.7 million citizens requiring care, at an estimated cost of up to £26 billion a year.

The cost of caring for people with dementia in Scotland is currently between £1.5bn and £1.7bn a year, and it is estimated that the number of people suffering from the condition will increase by 75 per cent by 2031. The vast majority of these people will require residential care.

Among the measures I propose are a 1p increase on the basic rate of tax, ringfenced to pay for long-term care of the elderly and the transfer of local authority homes to the private sector to cut costs while maintaining the highest possible standards of care.

A 1p increase in the basic rate of income tax would represent a significant step in the right direction, raising some £4.5bn a year across the UK. An equivalent, or an even higher, standard of care could be provided to elderly residents at a fraction of the cost if local authority-owned care homes were sold or leased.

Some local authorities charge out beds in their care homes at £200 a week more than the private sector, even though the standard of care is no better. In Scotland, councils provide about 5,200 residential care beds.