In our recent joint survey with leading trade publication, The Carer, we asked owners, directors, managers and staff in the elderly care sector whether they think the government understands and appropriately legislates and plans for the UK’s care requirements. Almost 70% of the respondents said “no”.
Low on the agenda
Since the survey was conducted the Prime Minister has pledged that no one will need to sell their home to fund their old age and has committed to cross-party talks. Some might feel this is long overdue.
So, why has planning and funding for the elderly care sector been on the ‘back burner’?
An obvious observation is that care for the elderly is not a major vote-winner when the government and the country has more visible issues which tend to take precedence. Our survey results also suggested that respondents believe the government is poorly advised and does not fully understand what is required to fulfil the needs of the sector.
It is also impossible to overlook the fact that over three years’ (and counting…) of focus on Brexit has diverted the government’s attention away from a range of issues, including care for the elderly.
Dealing with the facts
According to the Office for National Statistics, a 65 year old man retiring today is, on average, expected to live until he is 85, whereas a 65 year old woman retiring today can, on average, expect to live until she 87. Just ten year ago those figure were 79 and 83 respectively. By 2043 in the UK, nearly 21% of newborn boys and 26% of newborn girls are expected to live to at least 100 years of age (an increase from 13.6% for boys and 18.2% for girls born in 2018).
In the UK’s mature economy, with its growing and ageing population, a person will spend c.20% of their life in childhood, c.50% of their life as an economically active adult and c.30% of their life as an economically inactive retiree. The consequential issues, and the country’s ability to deal with them, are inextricably linked to the allocation of finite tax revenue across the nation’s spending priorities. Caring for the elderly is becoming increasingly costly because the needs of the most aged members of society extend well beyond the requirement for a clean, comfortable care home. The medical needs of this growing elderly cohort is, quite simply, becoming increasingly resource intensive and, as a nation, we are yet to grasp the enormity of the situation, let alone deal with it.
A ‘root and branch’ overhaul
Where do we go from here? In the survey, it was proposed that an increase in taxes could be a solution. Another respondent perceived a lack of ‘joined-up’ thinking – there is currently no coordinated initiative to address care for the elderly consistently and coherently.
Perhaps we need to find new and novel ways to encourage people to make financial provision for their old age, and to increase the statutory retirement age as the improving health of the nation allows people to remain active, and potentially economically active, way beyond 65 years of age. As a society we also need to engage in a debate which challenges us to fundamentally re-think of the way we address the needs of elderly citizens, for instance by embracing concepts such as multi-generational households.
Paul Zalkin is a partner and licensed insolvency practitioner at leading business advisory firm Quantuma. Paul has almost 25 years’ experience of working with businesses in a wide range of business sectors helping them overcome financial and operational challenges. During this time Paul has worked with a large number of care homes and has developed unique insight into the challenges they face. Over the last decade Paul has developed a niche in the care home sector and is a go-to adviser for distressed care home operators and their funders. Paul is regularly invited to speak at sector conferences and to share his thoughts with leading trade publications.
