For immediate distribution 21st February 2011
Partnership wanted to understand if the elderly would change their attitude towards funding their own care, once they realized how they had benefited financially compared to the young – who are arguably among the most indebted ever. The shift in attitude was significant! • However willingness to pay for elderly care was linked with social grade, with those of the higher social class - AB, C1 - most willing to make a contribution, both prior to considering the benefits they have experienced, and afterwards.
• People aged 50-69 also shift to paying for their care, particularly once the ‘concept’ of the ‘demographic time-bomb’ (there will be more elderly than young) is mentioned. They also experienced the most benefits.
• Those aged over 80 have experienced the least benefits.
• ABs have also clearly experienced more benefits than lower social classes and are also more aware of the concept of the ‘demographic time-bomb’.
IN THE FIRST MAJOR survey of 2011 into attitudes among the over 50s towards long term care funding by Partnership*, the specialist provider of long term care annuities (
please see PowerPoint slides attached), has revealed strong and wide ranging opinions on one of the key issues of our time.
• Among the over 50s, most already believe that care for the elderly should either be part funded by the Government with a contribution by the better off, or that most elderly should make a contribution.
• However once they were confronted with the fact that they had benefited from substantial increases in house value, free or nearly free university education, final salary pension schemes/non-contributory pension schemes, being able to buy shares at privatisation, child benefit for all families, and that ‘younger people will be worse off than the baby-boom generation because of likely tax rises and increases in educational costs and house prices’, all groups moved away from total government funding.
• Willingness to pay for elderly care is clearly linked with social grade, with those of the higher social class, AB, most willing to make a contribution, both prior to considering the benefits they have experienced, as well as afterwards.
• ABs and C1s are more likely to say that the elderly should contribute than the lower classes.
• Whilst initially, contributing towards elderly care is least favoured among the younger age group, there is a noticeable shift in attitude towards ‘financing your care’ among this group, who also claim they have benefited the most overall.
Prior to commissioning this latest research, Partnership had been aware that many believed the elderly were resistant to paying a contribution to their long term care.
However when initially asked, 54% believed that the elderly should make a contribution or pay for their care costs (38% thought it should be part funded by Government with a contribution by the better off in society (see slides) while 15% felt that most elderly people should make a contribution and 1% that everyone should pay for their own care costs). This was compared to the 43% who believed that the Government (or current and future taxpayers) should cover the full cost of long term care.
But when a variety of benefits that pensioners had enjoyed over their lives were pointed out to them, and the concept of the ‘demographic time bomb’ (see slide 4), the number of people who felt care should be fully funded by the Government dropped from 43% to 38%.
This 5% drop is statistically significant in this age group, according to research agency GfK NOP. Concomitantly, the number of people who believed that long term care should be funded partly by Government, with a contribution by the better off, grew to 41% from 38%. The number who felt that most elderly should make a contribution also rose to 17%. Overall this means that 59% believe that the elderly should make a contribution compared to 38% who do not.
Chris Horlick, Managing Director of Care at Partnership, said the research is “very significant.” “People aged over 60 have over 4/5s of the wealth of the UK and have over £1 trillion in un-mortgaged equity (CML). There are also now more people aged over 60 than under 16. There will not only be fewer younger people to pay the taxes to fund the elderly but they are also likely to be worse off than the ‘baby boomer’ generation.”
“This research demonstrates that the elderly are responsible and are prepared to change their attitudes to ensure that the youngest in our society – who have significant debts - do not shoulder the full burden for funding their care,” said Horlick.
“It is not surprising that people who are aware of the demographic timebomb (and that there will be more elderly people than fewer) and those who have felt most of these benefits, whether from free education for themselves or their families, or substantial increases in house value or final salary schemes have a most noticeable shift in attitude. This is typically people aged between 50-69 and in the higher social classes (ABs and CIs),” he added.
“The Government and the Dilnot Commission should be aware of this research. It demonstrates the benefits of generating awareness of the issues surrounding the funding of care by engaging in a broadly based public debate.
“It is a very telling statistic that 59% of elderly people will be willing to make a contribution to their care. This is a significant increase by the elderly once confronted with the benefits they have enjoyed compared to the young.” said Horlick.
“Most people are unaware that they may have to fund their social care, yet every year 53,000 people (or 41% of all people entering residential care), with assets over £23,250, have to. “This research demonstrates that provided people recognise how unfair it is to rely on the young to cover all the costs of their care, they are prepared to change their views, moving away from total Government funding and being prepared to contribute more to the cost of their care,” he added.
*About the survey Survey questions were included on GfK NOP’s Random Location Omnibus. Interviews were conducted face-to-face in the UK with 912 respondents over the age of 50 and selected using a random location methodology with quotas set on age and by gender within working status. Given the quotas, the final demographic profile is fairly close to that of the target population. However, to ensure that it is representative in terms of known population the data it is weighted on age, sex, social class, number of adults in household working status and region. Interviews were conducted 18th-23rd November 2010.
– Ends –
Media Enquiries: Jim Boyd, Director of Corporate Affairs
0797 345 8675 / 0845 108 7240
Partnership
jim.boyd@partnership.co.uk David Andrews Senior Consultant – Director
07941 255855 / 01273 725288
David Andrews Media Ltd
david@davidandrewsmedia.co.ukAbout Partnership: Partnership is a specialist provider of financial solutions for people with health/ lifestyle conditions, as well as those suffering from a serious medical impairment. Partnership was the first company in the UK to offer higher retirement incomes by taking account of people’s health and lifestyle conditions. It has been a consistent innovator developing this sector by championing the needs of those with even modestly reduced life expectancies. Partnership has led the way in providing products designed specifically for individuals whose health and lifestyle is likely to result in a reduced life expectancy. Partnership is expert in the field of medical underwriting and has a unique in-house data set. Partnership believes that its years of accumulated data and knowledge gives it a unique understanding of the impact of health and lifestyle choices on longevity. This, in turn, enables it to offer the most accurate assessment of a client’s life expectancy and therefore offer the fairest price to them. Partnership has the most comprehensive offering in the retirement sector and offers a complete range of Enhanced Annuity solutions, from clients who smoke or have minor health impairments, through to serious conditions such as cancer. Partnership is the largest provider of annuities for Long Term Care funding in the UK, with 80% of the market, and also offers specialist Protection solutions for clients who have been declined cover from standard providers. Partnership offers a firm commitment to supporting advisers in growing their business. Partnership was this year’s winner of the 'Long-term Care Provider' award at Health Insurance Awards and won this year’s Simply Biz ‘Annuity Provider of the Year’ award. It has been awarded a 5 Star rating at the prestigious Financial Adviser Service Awards, was judged “Best Enhanced Annuity Provider” at the Moneyfacts Awards and achieved an ‘eee-rating’ (the highest possible) for its web-based enhanced annuity platform in the e-Excellence Awards. www.partnership.co.uk Partnership is a trading style of The Partnership Group of Companies, which includes Partnership Life Assurance Company Limited (registered in England and Wales No. 05465261), which is authorised and regulated by the Financial Services Authority. Registered office: Sackville House, 143 – 149 Fenchurch Street, London EC3M 6BN. About GfK NOP GfK NOP Ltd is part of the GfK Group and a leading market research agency in the UK and internationally. It is a renowned supplier of market information and insight, offering sector specialists and best-in-field research for qualitative, quantitative, ethnographic, omnibus and online research services.