Your IndustryOct 16 2013

‘Assets clause is huge restriction to care funding plan’

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by

Lord Lipsey said the scheme was not available to anyone with assets worth more than £23,250, excluding their home, according to the government’s 100-page consultation on the reforms that was published in July.

Speaking at a House of Lords debate on the upcoming legislation, Lord Lipsey said: “Every council will offer a scheme but there is now a huge restriction that means few people will take advantage of the deferred payment scheme.

“The consultation paper makes it clear, in paragraph 150 on page 44, that you are eligible for a deferred payment loan only if your other assets in total come to less than £23,250. If you have more than that, you have to spend until you have £23,250 left and then you can consider a deferred payment scheme.”

In 2011 the Dilnot Commission proposed that no one should pay for care in their lifetime and money could be recouped from the estate after death. Aspects of the Commission’s report were being incorporated into the government’s Care Bill.

Colin Last, director of Berkshire-based Tamar IFA, said: “There needs to be more education to ensure that people only seek advisers with the right qualifications. Only some advisers have had suitable training to be able to offer advice in this complex area.”

Figures published by the Equity Release Council this week showed that almost 14,000 people aged over 55 have released equity from homes so far this year, with 5000 new customers in the market in the past quarter.