Leaving pensioners at the mercy of their budgets

Posted on: 23 November 2010 by Alexander Hay

The government's plans to assign the elderly their own care budgets are deeply flawed in many ways.

http://owl-group-staging.s3.amazonaws.com/upload_datas/29525/landscape_large.jpg?1290531949In military circles, the phrase "I've got a brilliant idea!" is seen as all too ominous. Usually issued by someone two weeks out of Sandhurst and halfway through a fire-fight, this line has been known to bring their subordinates to tears. Why? Well, just because it's an idea, that's not to say it's any good (or bulletproof)...

Likewise with the grandees of the ConDem government, whose brilliant idea this week is - wait for it! - to give older people control of their own care budgets. One million older people, if the new white paper is to be believed.

This may sound like a good idea initially. One would be giving power to otherwise vulnerable, marginalised people. Freeing them of the 'take it or leave it' perils of local government providers, this would mean that the elderly could benefit from the free market or even develop their own custom care plan with their local communities, in the best traditions of the Big Society...

Only, like most explosions of blue sky thinking, this is based on the assumption that everything will go exactly to plan, nothing will go wrong, it will snow at Christmas and the dice will always roll '6'. In this sense, the free marketeers in the Conservative party are no different from the bearded creatures who think communism will work 'if they give it just one more chance...' Brute reality, meanwhile, has other plans.

Take fraud. Let us assume that most old people are honest and compos mentis, and have spent their lives doing things more exciting than accountancy. They still have to trust that whoever provides them with their care won't overcharge, embezzle or otherwise cheat them out of their money. Since they are in need of care, book-keeping may well be low on their list of priorities. Many older people live alone – who will help them 'run their budgets'? Perhaps the same people who will most benefit.

The possibility for widespread fraud would, then, be high. The recent example of all those 'centenarians' in Tokyo whose families kept on collecting their pensions long after they had died is proof that this would be a bigger problem than the government might want to admit. Some awful care-homes remain stubbornly open - will they benefit from the new measures too?

Not that the government seems to care about this. Leaving ideology aside, the real selling point of the proposal is that it takes pressure off the state to provide what it's been paid to. If the pensioner then squanders, loses or is swindled out of their budget, then the government can shrug, say it's not its fault and look the other way. This underpins the 'Big Society' idea - the assumption that the voluntary sector can take up the slack of a retreating state.

The problem here is that the voluntary sector and the state are in fact intertwined. They share facilities, work in conjunction with one another and spread the load accordingly. Perhaps a 'Big Society' can be built, but it would take a generation of serious institutional and cultural change, and many needy people need help now rather than in 2040. Nor would such an enterprise necessarily succeed - pressure testing and political vision are seldom bedfellows.

The free market obsession is also to blame here. After over 30 years of privatisation, we can safely argue that the private sector doesn't have the answers, unless those answers are maximising their profits. This isn't a problem - private businesses are meant to make money, what with it being their raison d'etre and what have you.

But outside of the profit motive, any other benefits the private sector can provide are conditional. They are a means to an end, a tool in a box. Sometimes a private sector solution is needed, sometimes the state, sometimes both, with a dash of the third (charitable) sector to taste. But using the same tool for every occasion is foolish, not to say dogmatic.

What this most resembles, then, is another doomed attempt to bring radical new ideas to the fore and only then start to wonder if it was a good idea when it all goes wrong. And those pensioners who don't make it? 'Casualties of war' is the callous answer.

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Alexander Hay

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