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Earl Howe moved Amendment No. 271:

"( ) The relevant authority shall make regulations requiring that any persons receiving any services which are not considered nursing care, as determined by this section, shall receive detailed information on the costs of the provision of the personal care and accommodation prior to any agreement for the provision of community care services being made."

The noble Earl said: This amendment would ensure that all patients are given clear information as to the costs of personal care and accommodation before they enter a nursing home. It should be made clear exactly how much of the charges relate to personal care and how much to accommodation costs.

In its current form, there is nothing on the face of the Bill that helps elderly people to identify how much long-term care is likely to cost them. For many, if not most, people, that is a critical piece of information. Different patients require different levels of nursing care. That implies that there will be different charges for each patient, depending on the level of nursing and personal care which they will need. Of course, a patient's care needs will change throughout a stay in a residential home. Clear details of the costs of personal care would enable people and their families to prepare for possible future expenditure. It will also ensure minimal confusion when bills are presented to elderly people or their families. I beg to move.

Lord Hunt of Kings Heath: I wholeheartedly agree with the noble Earl, Lord Howe, but my understanding is that that information should already be provided. The current guidance about assessment of resources under the National Assistance (Assessment of Resources) Regulations 1992, with which I am sure we are all familiar, entitled The Charging for Residential Accommodation Guide makes it clear that anyone entering residential care must receive detailed information on the funding of the placement and the contribution he may be required to make before agreeing to any placement being made. I hope that that answers the important point which is being made here.

Baroness Masham of Ilton: What happens if, after a few months, someone finds that he cannot pay? What happens to him then?

Lord Hunt of Kings Heath: I am not sure about after two months, but there clearly are circumstances in which people's resources run down and in some cases, those people have faced eviction. Assuming that people have run down to the capital limit, when the means test kicks in, it would then be a matter for the local authority, in conjunction with the person involved, to decide what to do. But I certainly agree with the noble Baroness's implication that that may leave people in a very difficult situation.

Earl Howe: I am grateful to the Minister for his response. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 56 agreed to.

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Clause 57 [Preserved rights: transfer to local authorities of responsibilities as to accommodation]:

Baroness Barker moved Amendment No. 272:

    Page 59, line 5, leave out "on the appointed day" and insert "from 1st October 2001"

The noble Baroness said: This amendment deals with the issue of preserved rights. If ever there was a misnomer in the field of social care, it is the words "preserved rights". Those provisions relate to people in residential care before 1993 and enable local authorities having to take on responsibility for about 0.25 million people who were then funded by the Department of Social Security. They were supposed to reassure them that there would be no change for them. But in many cases, the income support did not meet ceiling levels of the home and many older people caught in that trap have been forced into penury. The reason for the proposal to move the date to October 2001 is, therefore, to help a group of people who are often in dire hardship as a result of having to try to meet the difference in cost--either by themselves or their relatives or by recourse to charities--of where they live and their income.

One of the purposes of the amendment is to seek reassurance from the Minister that when social service departments take on a case, just because a person is in a home that is more expensive than the level of fees which a local authority would normally pay, that should not be a reason for moving that person.

We are talking of older people who in many cases are well into their eighties and nineties and in one case which was recently alluded to on Radio 4's "You and Yours" 102 years-old. A lady of 102 was threatened with eviction. At that time and in that case there was a statement from the Minister's department that:

    "Councils already have powers to help people of working age who are struggling to pay their fees. We accept that possible eviction is a problem for some older people, particularly those in nursing homes whom councils cannot normally help. We are planning to change the regulations shortly to remove some of the present restrictions that prevent councils from helping".

To the best of my knowledge, that has not been forthcoming.

Another reason for moving the amendment is to seek reassurance that local authorities will receive adequate funding, not just for the costs of homes but also for the cost of extra assessment and extra care management.

The Minister will not be surprised at my asking what happened to regulations which were promised at the end of last year and still have not appeared. They were supposed to be forthcoming within a few months to help older people until April 2002. I can only assume that the Minister's department has been working so hard on the national service framework that it has not been able to get those out to us.

The amendment deals with the unhappy situation of a number of elderly people who are in dire need. I therefore hope that the Minister will look favourably upon it. I beg to move.

Lord Hunt of Kings Heath: The noble Baroness has put the case well. I understand the difficulties and

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pressures on this group of people. I also want to assure her that the intention is that they should stay in their existing homes.

We are working closely with colleagues in the Department of Social Security and with the local authority associations to ensure a smooth transition to the new system. I also understand the need for urgency. Local authorities and benefit offices need as much time as is reasonably possible to plan their management of the change if it is to be introduced effectively. In addition, people affected need to be given time to prepare for the change.

The Department of Social Security is planning to write to the people concerned to notify them of the reasons for the change to their benefit payments and to explain the local authority's involvement in and responsibility for their future care needs. That obviously requires a great deal of planning and preparation. It can start only after the passage of the Bill. That is why we felt that April 2002 was the best date to start the scheme.

Given that what we propose will involve a reassessment of and changes to the income support payments which people with preserved rights currently receive, it also makes sense to introduce the change at the same time as other planned changes are made to the benefit. As the noble Baroness will know, the annual increase in all income support rates takes place every April.

As regards the regulations, perhaps I may say to the noble Baroness that we are working on them; I cannot give her a date.

Baroness Barker: I am very glad that the Minister did not give a date because I am not sure that I would have been able to keep to it. We are talking not just about the cost of implementing the abolition of preserved rights, but also its associated costs. The Minister and Members of the Committee will know about the consequences when very elderly people are moved from their long-established homes. There are well-documented cases where such transition has taken place quickly without any help, support or advocacy. The result has been a very much higher death rate than anticipated among these elderly people. Therefore, will the cost of additional matters such as advocacy be included in the provisions?

Lord Hunt of Kings Heath: I thought I had said that the intention was for people to remain in their homes. I well recognise the issue that she raised. It is something which the National Health Service has found when it has moved residents who have been at one address for a very long time. The mortality rate is extremely high. We clearly have to avoid that.

Baroness Barker: I am very happy to accept the Minister's assurances. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Earl Howe moved Amendment No. 273:

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    Page 60, line 9, at end insert--

"( ) Before bringing this section into force the Secretary of State shall consult such bodies and organisations as he may consider to represent the relevant interests of local government as to--
(a) the methodology to be used for calculating the amounts required to fund the arrangements provided for in this section;
(b) the methodology to be used for calculating a fair and equitable distribution of such funding amongst local authorities; and
(c) the means whereby such funding is to be transferred."

The noble Earl said: The contentious issues surrounding preserved rights are not to any great extent about policy, they are about implementation. In a nutshell, unless the level of funding transfer reflects the actual costs and not just the current level of social security funding involved, then local authorities with large numbers of preserved rights residents will be unable to implement the policy without incurring very serious financial difficulties. The Minister will be aware that the actual costs for local authorities include not just the funding to be paid to home owners as fees, but additional costs associated with care management, financial assessment, contracting, invoice processing and income collection.

The DSS has estimated that in 45 per cent of preserved rights cases there is a shortfall between the fees charged by care home owners and the weekly benefit income of residents. That has arisen because over the years benefit increases have failed to keep pace with the actual costs faced by care home providers.

The fear among local authorities that are likely to be the worst affected, such as Kent, East and West Sussex, Devon and Lancashire, is that the funding transfer from social security will involve only the transfer of current expenditure. These sums are due to be increased in April, but unfortunately there is little comfort in the level of increase as it is only 1.8 per cent, which is well below inflation. But if that happens, then the shortfall in fees currently met by social security would have to be met instead by local authorities from their own resources, including council tax receipts.

On the worst case premise, Kent County Council has calculated that, with an estimated 4,000 preserved rights residents, the additional annual cost to its budget would be of the order of £8 million to £10 million. That is a huge sum of money to find. What is needed is some reassurance to local authorities such as Kent. I am looking for a categorical assurance, if the Minister can give it, that these clauses, irrespective of the overt policy intention which is perfectly sound, are not going to be used as a means of transferring an unfunded cost pressure from central government funding to local authorities and their tax payers. That is why my Amendment No. 273 specifies that before anything happens under the provisions of this clause, there has to be consultation, not just about the money itself, but about the methodology to be used in calculating what local authorities need, how to determine a fair allocation between local authorities, and how in practice the money will be transferred,

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whether by SSA or by special or specific grant. The Association of Directors of Social Services, the LGA and CIPFA need to be involved here.

I should be grateful if the Minister would take this opportunity to confirm that the funding transfer to local government will reflect actual costs of care provision; that the additional care management and other costs that I mentioned will be reflected transparently in the financial settlement for local government; and that the Government will give thought to setting up some kind of mechanism to compensate those relatively few local authorities who will find their administrative workloads increased dramatically as a result of this change of policy. I beg to move.

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