Reports in the media are suggesting that the Government’s pledge to introduce a cap on social care costs by 2020 has been further delayed – with the possibility that further consultations will see it abandoned entirely.

The news comes just months after the Prime Minister was forced into an embarrassing U-turn on her election manifesto pledge to abandon the cap after the proposals were branded a “dementia tax”, leading to a promise that a cap of some sort would be introduced.

That promise now seems to have been kicked into the long grass. A senior Government source is reported to saying that the cap will not be introduced until well into the next decade at the earliest.

The care cap, first proposed by Sir Andrew Dilnot in 2011, was adopted as Tory policy ahead of the 2015 election – but delayed soon afterwards.

For anyone planning their retirement finances with resources and savings, it will mean taking into account that they may well end up paying all their future care home costs, which can easily top £30,000 a year. Care at home can also be a significant cost depending upon the person’s needs.

Paying for care can be planned for through products such as investment bonds, but without a time frame of how long a person will require support, it can be highly problematic to forecast how much will be required.

The dilemma for this and any future government is three-fold.

Firstly, those who have only small savings (currently below £23,250) have their care costs met by the State – leading to accusations that the system is unfair on those who have saved.

Secondly, many of those who will need to fund their own care will have to resort to selling their home – and this has proved to be a difficult policy to sell to traditional Tory voters.

Thirdly, any additional expenditure on care, which is already seriously underfunded, would need to come from tax receipts – being paid by younger people in work, many of whom are already struggling to afford to own their own home.

All this needs to be set against a backdrop of an ageing demographic – the population of over-80s is forecast to double in 20 years, which will inevitably lead to ballooning demands for care.

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