Inheritance tax to pay for care

Health Secretary Jeremy Hunt has announced plans to cap bills for long-term care in old age at £75,000 in England, in a £1 billion move to be funded by dragging more people into the inheritance tax net.

Campaigners voiced disappointment at the level of the cap - more than double the £35,000 recommended by the independent Dilnot Commission in 2011.

ITV News Political Correspondent Carl Dinnen reports:

The changes to the social care system will help protect people from having to sell off their homes to fund care bills in later life, the Health Secretary Jeremy Hunt has said.

He said the soon-to-be announced proposals were not "the whole solution" but were a "very big step" in making Britain "a great country to grow old in".

Andrew Dilnot, who chaired the independent commission set up by the Government to examine the funding of elderly care, has said the Coalition's planned changes will reduce the "anxiety" at covering costs in later life.

Mr Dilnot described the current system as a "complete disaster".

Speaking on BBC Radio 4's Today programme, he said he "regretted" the Government's expected new cap of £75,000 on the costs people pay for care, having recommended £35,000, but said he accepted public finances are in a "pretty tricky state".

He said the proposals, set to be announced later by Health Secretary Jeremy Hunt, mean "for the first time you don't have to be terrified of needing care".

He said the changes meant people "are effectively insured by the state, which should make them feel much more comfortable".

Today, the government is expected to announce a cap on how much people pay to be looked after in old age.

If it goes ahead it means pensioners will not pay more than £75,000 towards the cost of their care.

Dot Gibson from the National Pensioners Convention spoke to ITV Daybreak, she said: "We should have a system whereby we all pay into a national care system, and everybody benefits at the end of the day."

Read: Care cap could be paid for by inheritance tax freeze

The coalition will today announce that elderly care bills are to be capped by the state in a £1 billion move expected to be funded by dragging more people into inheritance tax.

To the disappointment of many campaigners, the cap will be set at £75,000 - more than double the £35,000 recommended by the independent Dilnot Commission.

But thousands more people will be hit with inheritance tax bills because of a three-year extension of the freeze in the £325,000 threshold - £650,000 for couples - at which it kicks in at 40%.

Thousands more people will have to pay inheritance tax to fund changes to social care in England, according to reports.

The government is set to announce tomorrow that the threshold is to be frozen for three years despite previous pledges that it would be raised.

ITV News' Sue Saville reports:

Saga Homecare has welcomed Government plans to put a cap on the costs of care at £75,000, but said the reforms needed to be implemented sooner. The organisation's director Tim Pethick said: