General Election 2017: What the manifestos mean for the Wills & Probate market

Among the many issues highlighted in the recently published manifestos, social care and later life planning have been the subject of much debate.

As the NHS struggles to deal with the pressures of an ageing population, there is concern that many of the older generation are suffering in silence. In light of proposed reductions to pension security and increases in inheritance tax, decisions regarding future life planning are likely to have a significant impact on multiple generations in the long term.

The three major political parties have both differing and similar proposals in their plans to deal with later life planning. Below is a summary of what they aim to achieve and how they intend to do so.

Liberal Democrat’s view:

• Social Care
  • Acknowledging the current crisis point that social care services have reached, the Liberal Democrats aim to take key steps to return it to a more secure financial level.
    Their measures include:
  • Introduce a 1p rise in basic, higher and additional income Tax rates, with an aim to raise £6 billion additional revenue to be spent only on NHS and social care.
  • Social care, primary care and mental and public health are to be prioritised in regard to the raised funds.
  • A dedicated health and care tax will be raised in a wider consultation as a long-term funding solution.
  • Introduce a health and social care convention across parties in order to review a longer-term plan for sustainability.
  • Bring in a statutory independent budget monitoring agency specifically for health and care. Every three years, a report would be produced on the amount of money required to provide a sustainable and safe service, accounting for projected demand growth and upcoming developments.
  • Aim to eventually bring the NHS and social care together.
  • Offer a greater range of options for care at the end of life, moving towards free social care regardless of how people want to spend their final days.
• Health in Later Life
  • Encourage easier access to GP’s.
  • Ensure fairness for those with long-term disabilities or conditions by reviewing exemption rules for prescription charges.
  • Aim to create a system that empowers people to manage their own health and conditions.
  • Keep public health within local government and reinstate cuts from public health budget.
• Pensioners
  • Maintain the triple-lock pension – increasing on a yearly basis by the highest of earnings growth, price growth or 2.5% for the next parliament.
  • Consider the implications of introducing a single rate of tax relief for pensions.
  • Abolish marriage inequalities and spousal veto in relation to pensions.
  • For pensioners who pay tax at the higher rate of 40%, withdraw Winter Fuel Payment eligibility.
  • Reverse the Conservative raising of the Inheritance Tax threshold.

The Conservative view:

• Social Care
  • Considering the UK’s ageing population and growing demand for social care, the Conservative proposals aim to give older generations security in later life.
    They aim to:
  • Align means-testing for domiciliary care with the model currently used for residential care. This means that property value will be taken into account when assessing the total asset value, regardless of where the care takes place.
  • Implement a capital floor at £100,000, meaning that people will always retain this value of assets and savings.
  • Extend the existing freedom for residential care payment deferral to domiciliary care.
• The upcoming Green paper will outline the following proposals:
  • Improvement of the elderly care system to address system-wide issues
  • Aim to reduce loneliness and promote technological solutions to sustain independent living.
  • Investment in dementia research.
• Pensions
  • Tighten the rules on pension abuse and increase the punishment for mismanagement of pension schemes.
  • Extend the powers of the Pensions Regulator and pension schemes to prevent issues which threaten the scheme’s solvency.
  • Maintain the Triple Lock on pensions until 2020, where a new Double Lock will be introduced. This will mean pensions will grow in line either with the earnings that fund them or inflation – whichever is greater.
  • Promote pensions and long-term saving products to encourage all generations to make plans for later life e.g. retirement and funding a house purchase.
  • Review the Winter Fuel Payments, introducing a means-test so assistance is focussed on the least well-off.
  • Maintain all other pensioner benefits.

The Labour view:

• Social Care
  • Acknowledging the stress put on the social care system, the Labour party set out their aims to rebalance the system, and ensure the security of care for the UK’s ageing population.
    Their proposals include:
  • Lay the foundations of a National Care Service for England during Parliament’s first term. This will be built alongside the NHS with a movement towards a joined-up service.
  • Increase the social care budgets by an additional £8 billion over the duration of Parliament, with an extra £1 billion for the first year.
  • An annual total of £3 billion in public funding will go towards the National Care Service in the first few years. Labour’s aim is to raise enough funds to put a cap on personal contributions to care costs and raise the asset threshold. They also propose that there will be no cost for end of life care.
  • Funding options include social care levies, employer care contributions or wealth taxes, but this will be considered on a cross-party level.
  • Aim to improve home insulation in order to reduce the number of winter deaths.
• Pensions
  • Maintain the Triple Lock on pensions for the duration of the next Parliament. This will grow annually by at least 2.5%, stay in line with inflation or increase with earnings – whichever is greater.
  • Maintain the Winter Fuel Allowance as well as other current pension benefits.
  • Provide compensation to the 2.5 million women who had their state pension age raised without fair notification. Properly consider their losses and explore options for transitional protection to minimise the risk of this happening again.
  • Protect the pensions of UK citizens living overseas.
  • Review the pension age with an aim to create a retirement policy reflecting the lifetime contributions made by individuals as well as the variations in life expectancy.
  • Bring an end to hidden pension charges and fees and develop larger and more efficient pension funds.
  • Protect employee pensions where a business is being taken over.