Previously, the changes to social care costs, first proposed in 2021, were expected to be enacted in 2025. They would limit the total cost of care any recipient in England would need to pay over their lifetime to £86,000.
The upcoming changes to the thresholds used to calculate eligibility for local council care funding, where the lower and upper thresholds would both have risen significantly, have also been cancelled.
Let’s look at why these reforms have been reversed, what that means for care recipients reliant on financial assistance, and where this leaves families needing care for themselves or a loved one.
Understanding the Shifting Picture Around English Care Costs
We’ll start with a recap of the policies we expected to replace the current system. It’s worth noting that although changes to care costs were first announced three years ago, they had already been pushed back, with an original start date of October 2023 postponed to October 2025.
In summary, these reforms would have meant that:
- The lower and upper thresholds, which determine whether a person qualifies for partial or full council care funding, would have risen from £14,250 to £20,000 and from £23,250 to £100,000.
- Care recipients with income or assets below £20,000 would have had full local authority funding, whereas those with wealth between £20,000 and £100,000 would have paid for part of their care costs, calculated on a sliding scale.
- From 2025, the now-cancelled care cap would have applied throughout England, and anybody paying for their care would pay a maximum of £86,000 over their life. Even for higher earners, the threshold would remain—they would, in effect, self-fund their care costs up to £86,000.
These rules were intended to apply to personal care costs, whether in a residential care setting, such as a care or nursing home, or personal care delivered in the person’s own home. Personal care includes support with tasks like washing, bathing and medications.
While these changes would have applied only to England, the care funding thresholds in Wales are already much higher, and in Scotland, the caps to qualify for local authority care have also been increased recently.
Why Have Changes to Care Cost Caps in England Been Scrapped?
The primary reason the new government has given for cancelling all of the above policies is a deficit within the national budget—the Chancellor has stated that the care cap would be unaffordable and was not sufficiently budgeted for.
This news comes alongside announcements that the Winter Fuel Payments have also been cut back and are now only payable to fewer recipients claiming Pension Credit.
Although cancelling care cost reforms is expected to save around £1.1 billion by the end of the 2025/26 financial year, it undoubtedly leaves many families, including those caring for the needs of younger people with disabilities, in a far worse financial position.
What Are the Current Rules Around Government and Local Authority Funding for Personal Care?
The scrapping of higher means testing thresholds, and the lifetime care cap means that the rules revert to their current position – there will be no changes:
- Care recipients with income or savings above £23,250 will need to cover the full cost of any care – including respite, home, temporary and permanent residential care.
- Individuals with assets valued below £14,250 will be eligible for full funding support from their local authority. Any income received may be partly allocated to pay for some of the care fees.
- People requiring care who have assets between those two amounts will usually qualify for some degree of financial support but will be expected to cover the difference.
There is also no limit on the amount that one person or family will have to pay for their care over the course of a lifetime, which can disproportionately impact those with ongoing care needs or for whom care is expected to continue for several years.
How to Find Help With the Costs of Care
Whether you are already paying for care, are considering how you will manage the cost of care for an older loved one or relative whose needs are changing or are worried about the future care fees for yourself or your family, the first step is always to speak with a compassionate, professional care team who can clarify all the options available.
One common decision is to select care at home rather than a residential care home, as care providers can customise the type of care they deliver and the number of visits or hours they spend caring for the needs of yourself or a loved one in your own home.
Many families find that home care is considerably more affordable than a long-term place in a residential care setting since they can adapt their care according to needs, such as:
- Organising visiting care two or three times a week for a fixed number of hours.
- Requesting help with specific tasks or routines, such as mealtimes, medications or domiciliary support around the home.
- Putting care in place for a couple, rather than looking for accommodation in a care setting where one person requires care that their partner finds difficult to provide.
Home care services can be arranged as overnight, live-in and respite care, or specialist care for families with more complex or ongoing care requirements.
Funding and Benefits Payments to Contribute Towards the Cost of Care
Some families may be eligible for financial support to assist with the costs of either at-home or residential care, even if their assets exceed the means-testing caps used to determine whether the local council will cover or contribute towards their care costs.
For example, Continuing Healthcare Funding (CHC) is available through the NHS for people with certain health conditions that require care support, and many care recipients may qualify for the Attendance Allowance or Personal Independence Payment (PIP), which are non-means-tested benefits.
If you’d like to chat about your care needs, the impacts of the reversal to planned maximum care cost caps, or to have a confidential discussion with one of our dedicated care managers, please get in touch with your nearest Guardian Angel Carers team at any time.