The government set out its new reform for adult social care in England on the 7th September 2021. The proposed plan included a lifetime cap on the amount anyone in England will need to spend on their personal care, alongside a more generous means-test for local authority financial support. 
Under the current funding rules: 
 
♦ A person with capital over £23,250 - Is expected to pay all care fees themselves (known as self-funding). The individual would need to fund their care from their capital assets and income. 
If capital ever reduces below £23,250, then the local authority will assist with the funding. 
 
♦ A person with capital between £14,250 and £23,250 - Is treated as if they have an extra income. Meaning for every £250 or part of £250 above the £14,250 limit, an income of £1 a week is assumed, and this will be payable towards the cost of care. 
 
♦ A person with capital below £14,250 is fully disregarded when considering if a person should pay for their own care. 
 
Any income received will be included in the financial assessment 'means test', normally considered on a weekly basis and is taken into account in full (there are some exceptions to this). 
 
If a person’s weekly income is in excess of the cost of the weekly care costs then they will be considered a 'self-funder'. However local authorities must allow individuals to keep a personal expenses allowance of £24.90, this cannot be used towards the cost of care and is reserved for their personal use. Local authorities do have discretionary powers to increase the personal expenses allowance. 
Proposed Changes 
 
From October 2023, the government will be introducing a new £86,000 cap on the amount anyone in England will need to spend on their personal care during their lifetime. 
 
Furthermore, the upper capital limit, this is the point at which people become eligible to receive some financial support from their local authority, will increase from £23,250 to £100,000. People with less than £100,000 of chargeable assets are expected to contribute no more than 20% of their assets per year. This means that a person with capital below £20,000 is not expected to contribute capital (only income), towards the cost of their care. The lower capital limit will therefore see the threshold increase from £14,250 to £20,000. A person with capital over £100,000 will be expected to self-fund their care. 
The cap will not cover the daily living costs, these include rent, food and utility bills (for both those in a care home and in their own home). Rather than having to calculate daily living costs, for simplicity, a national flat rate of £200 per week will be set. 
Any top-ups for care will not count towards the cap. 
 
When the cap has been reached, a person will  be expected to fund their daily living costs and pay for any top-ups. Costs prior to October 2023 will not be counted towards the cap. 
* The changes are currently proposed to take effect from October 2023 with further guidance to be published in Spring 2022 * 
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