July 4th 2011
On the day that Andrew Dilnot announces a range of care proposals, a major intergenerational research study of young people (18-65) undertaken by the UK’s largest long term care annuity provider Partnership, reveals that younger people feel they should not bear the weight of care funding through taxation.
However these conclusions were only formed once those surveyed understood the relative wealth of the elderly - and the indebtedness of the young.
Key findings:
- 45% of the young now favour government funding (e.g. taxation) – this drops by 20% to 36% when they understand consequences – with more elderly to make contributions.
- Once the consequences have been explained, wealthiest (ABs) most likely to agree with individuals contributing to care funding costs (74%) – while only 26% of ABs back full Government funding.
- Surprisingly lowest socio economic groups (DE) show the most pronounced shift away from full government payment (52% to 41%) although it is less surprising that nearly 40% (of DEs) think “the better off” in particular should contribute.
- The worries of the young range from making ends meet (34%), Job security (30%), Pensions provision (26%), keeping a car on the road (24%), university education (20%), paying the mortgage (16%), buying a first home (15%), affording a large enough home (10%) and care for an elderly relative (6%) *
Chris Horlick, Managing Director, Care at Partnership said, “We welcome Andrew Dilnot’s proposals. They are a critical step in generating a full public debate on the significant implications of social care funding. These findings highlight how important this is – when the young understand they will have to shoulder the care funding burden of the elderly, who have enjoyed many financial benefits that they will not, there is an understandable shift in their thinking.
“What is so significant is that this is not a predictable and negative piece of research highlighting tensions between the young and the old.
“The research pinpoints a shift in thinking which mirrors that of the elderly** once they understand the implications of the demographic time bomb,” said Horlick.
“Among the elderly this change was most pronounced among those who felt they had experienced the most benefits.
“The public needs to understand the consequences of our rapidly ageing population.
In particular younger tax payers who are shrinking as a proportion of our total population.” he added.
“In 2010, over 16% (8.6 million) of our population were aged over 65 (Office of National Statistics, December 2010). “However, by 2030 people aged over 65 are expected to increase by 50%, with the most significant increase among over 70s – the age group most likely to need care.
“Currently there are 6.2 million people aged over 70 in the UK (ONS 2010) however by 2030 their numbers will increase to 9.6 million. The rapid increase of the over 70s sector will be matched by a significant and sharp decline among people of working age –from today’s ratio of 5.3 people working for every person aged 70 down to just 3.7.
“To rely on social care to be funded by direct taxation among the fewer young is simply not a practical solution.
“This research shows that the young, who are arguably among the most indebted generations ever, are already confronting significant concerns with one in three worrying about making ends meet and keeping their jobs.
“One in four young people worry about keeping a car on the road and pensions, while one in five worry about university education.
“Housing remains a significant issue with first time buyers not expecting to purchase their first home until they are 38. It is hardly surprising that only 15% worry about buying a first home as one in three Britons say they do not intend to buy a house at all*** * “
These anxieties among the young are likely to persist as the effects of the recession continue.
“In contrast, people aged over 65 collectively own property worth £765.18 bn on which they do not have a mortgage (Key Retirement Solutions – based on analysis of ONS and Land Registry Data, 2010).
Research conducted by GfK NOP among over 50s found that 53% would sell their homes to finance their care fees.*****”
- Ends - Notes to Editors
*Responses given to prompted questions
**Partnership conducted 827 face to face interviews with people aged 16-65 from 12-17 May. Survey questions were included on GFK NOP’s Random Location Omnibus. Respondents are 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 data it is weighted on age, sex, social class, number of adults in household working status and region
***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. Please see link
****Moneysupermarket.com - 20 May 2011
***** GfK NOP interviewed 467 adults aged over 50 across the UK by telephone on 26-28 March 2010. Weights were applied to the data to bring it into line with national profiles. Full research details available on request.
See link
Press Enquiries
Jim Boyd, Director of Corporate Affairs
0797 345 8675 / 0845 108 7240
jim.boyd@partnership.co.uk
David Andrews, Senior Consultant - Director
07941 255855 / 01273 711567
DAM PR david@davidandrewsmedia.co.uk
About 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 give 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 a 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