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23Jul14 - ILC-UK_SOS 2020_Presentation
- 1. Sustainable Older Society2020 (SOS 2020) Wednesday 23rd July 2014 This event is kindly sponsored by #SOS2020
- 2. Welcome Baroness Sally Greengross ChiefExecutive ILC-UK This event is kindly sponsored by #SOS2020
- 3. Trevor Llanwarne Government Actuary GovernmentActuary’s Department This event is kindly sponsored by #SOS2020
- 4. Healthcare Sustainability This eventis kindly sponsored by #SOS2020
- 5. Lawrence Churchill Trustee ILC-UK This eventis kindly sponsored by #SOS2020
- 6. Indicative Statistics Present/ C.2050% Recent past Increase • World % of over 60’s 10% 20% 100% • Older people needing care 101m 277m 174% • People with dementia 44m 135m 207% • % of UK GDP (Health, Pensions, 13% 19% 46% Social care)
- 7. Potential Vision • “A(global) society, which maximises good health throughout the life course, which has mastered preventable diseases & where health care systems – Are efficient – Publicise outcomes – Are accessible to all citizens at all times – Minimise rationing – Have tariffs for usage which command wide support – Continue to evolve to changing demands”
- 8. Shaun Crawford Global InsuranceSector Leader Ernst & Young This event is kindly sponsored by #SOS2020
- 9. Julian Le Grand Chairman,LSE Health and Social Care LSE This event is kindly sponsored by #SOS2020
- 10. Tom Kenny Partnership, representingthe Institute and Faculty of Actuaries This event is kindly sponsored by #SOS2020
- 11.
- 12. Caring for anageing population 12 % of population age 85 and over % of population age 65 and over 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 • UK number aged 65+ is expected to increase by more than 50% in the next 20 years • Aged 85+ expected to more than double in the same period • Wide variations in life expectancies and probability of needing care between males and females • Variation by geographical region in life expectancy and morbidity • Incidences of dementia (moderate or severe cognitive impairment) are rising
- 13. Background to socialcare changes • Background to social care changes – Timeline – Care Act - Consultation – Cap – Different costs (hotel, LA rate, top-up) – New means test limits – (£17k to 27k/118k) – Other changes • Recent budget announcement – Facilitate product innovation – Concern of pension funds being exhausted before needing LTC
- 14. What is sustainablecare? • Sustainable = greater self funding? • Greater self funding can be achieved by – Increasing awareness of • long term care costs • longevity risk at retirement • financial options for providing an income in retirement including meeting care costs – Product innovation – Tax incentives to encourage saving
- 15. Summary of findingsfrom IFoA paper • Need greater saving into pensions • Pensions Bill • Significant proportion of retirees will need LTC • Most people who need LTC will not benefit from the cap • Benefit of cap and personal costs vary significantly by region • Range of pension products that could support LTC • Communication • Regulatory and tax changes
- 16. 5.7 6.1 6.4 5.6 6 4.5 3.9 3.4 4 4.7 9 7 6 9 7 14 18 22 17 13 £0 £50,000 £100,000 £150,000 £200,000 £250,000 £300,000 £350,000 0 5 10 15 20 25 North EastNorth West Yorkshire & the Humber East Midlands West Midlands East of England London South East South West England CareCostsbeforeandafterthecapisreached Personal Funding of Care Costs by Region in England from 2016 Care Home with Nursing - 85 at entry into Care Personal Funding required before the Cap is reached Personal Funding for the remainder of the 10 year period Years before Cap is reached Percentage probability of surviving to when the Cap is reached Probabilty of reaching the cap (%) Years before cap is reached
- 17. What do weneed to know? • We need greater sharing of social care cost data by local authorities • We need to understand how technology will impact care • We need to understand how medical advances will affect the ageing society • We need to know how local authority rates will change under the new regime – will the gap between LA rates and care costs reduce? How will top-up of care costs affect this?
- 18. What do weneed to do? • Stable social care regime to provide foundation for greater product development • Create an effective information and advice process to encourage greater saving and informed pensions decisions at retirement • Technical changes to support product development
- 19. Eppu Mikkonen-Jeanneret Head ofPolicy Helpage International This event is kindly sponsored by #SOS2020
- 20. Discussion and Q&A Thisevent is kindly sponsored by #SOS2020
- 21. Retirement Income Sustainability Thisevent is kindly sponsored by #SOS2020
- 22. Ben Franklin Research Fellow ILC-UK Thisevent is kindly sponsored by #SOS2020
- 23. 6.4 1.2 5.5 0.8 20.4 7.5 1.7 6.7 0.9 23.0 8.5 2.3 7.9 0.9 25.1 0 5 10 15 20 25 30 Health Long-term careState pensions Pensioner benefits Total age-related spending OBR spending projections as % of UK GDP 2018-19 2033-34 2063-64 Source: OBR 2014 Fiscal Sustainability Report PercentofGDP
- 24. 80 90 100 110 120 130 140 150 160 170 180 1997Q4 1998Q3 1999Q2 2000Q1 2000Q4 2001Q3 2002Q2 2003Q1 2003Q4 2004Q3 2005Q2 2006Q1 2006Q4 2007Q3 2008Q2 2009Q1 2009Q4 2010Q3 2011Q2 2012Q1 2012Q4 2013Q3 2014Q2 2015Q1 2015Q4 2016Q3 2017Q2 2018Q1 2018Q4 Historic Mar-14 Dec-13 Mar-13 Liabilitiestoincomeratio Source: ONS, OBRand author's Debt to income: Actual and projections (various OBR
- 25. Clive Bolton Managing Director,Retirement Solutions Aviva UK Life This event is kindly sponsored by #SOS2020
- 26. Mick McAteer This eventis kindly sponsored by #SOS2020
- 27. Jane Vass Head ofPublic Policy Age UK This event is kindly sponsored by #SOS2020
- 28. Discussion and Q&A Thisevent is kindly sponsored by #SOS2020
- 29. Sustainable Older Society2020 (SOS 2020) Wednesday 23rd July 2014 This event is kindly sponsored by #SOS2020
Editor's Notes
- #17 This chart shows how care costs can vary significantly by region and it shows the significant care costs pre hitting the cap and post reaching the cap