‘Dementia tax’
Last month, the Tory manifesto unveiled plans to significantly raise the threshold of personal assets at which people will be eligible for state help with residential care costs from £23,250 to £100,000 (€116,424, $129,396).
The “floor” means people with more than £100,000 in assets will have to use their homes to meet rising care costs, rather than relying on the council to cover the costs of visits by care workers.
Currently, anyone with assets of over £23,250 is expected to pay the full cost of their care, which doesn’t include the value of their homes. Taxpayers can defer payment as the state will deduct the cost from their estate when they die.
The Conservatives faced backlash on the policy, dubbed the ‘dementia tax’, because sufferers of the disease living at home will have to pay while people with cancer in hospital would not.
‘Worst possible outcome’
Tom Selby, senior analyst at AJ Bell, said: “A hung parliament is the worst possible outcome for pensioners and people saving for their retirement.
“We will now have a period of limbo while a new government is formed and we may well be heading back to the polls later this year.
“It means that key decisions around the state retirement age, the state pension triple lock, social care funding and pension tax relief are all going to take a back seat while the wheels of Westminster slowly turn.”
