Andrew Lansley: elderly will be able to opt in to social care insurance scheme The elderly will be able to "opt in" to a government social insurance scheme - paying premiums to the state to ensure their costs for care and accommodation would be capped, the health secretary has announced. The government says it would consider a "voluntary scheme" that would allow people to "individually make the choice to be protected by a capped cost scheme." Sources say the taxpayer would have to bear the one-in-10 risk of "catastrophic" costs of above £100,000. The scheme both emulates and undermines the recommendations of the Dilnot report, which called for a system for the elderly whereby the total cost of care would be capped at £35,000 and support for old people extended to those with assets of £100,000, up from the current limit of £23,250. So-called "hotel costs" - to pay for food and beds in residential homes - would be limited to between £7,000 to £10,000. Lansley's scheme would not provide universal coverage as only those who paid into the social insurance scheme would get the benefits - risking the ire of the Liberal Democrats, who argue that poorer pensioners would lose out. However, the scheme would enable the government to say it has introduced the Dilnot recommendations without public cash - defusing a key charge of Labour ministers that it has kicked social care into the "long grass." The Treasury successfully argued that the economic situation meant the government was "unable to introduce the new system at this stage." Lansley will also have to argue that his new voluntary scheme will not impose extra costs before the next spending round. One Whitehall source said George Osborne was also concerned that a voluntary scheme would potentially bring in another 150,000 people currently being cared for in their own homes expecting their eventual residential care costs to be capped. Richard Humphries of the health thinktank the King's Fund said Lansley's insurance proposal was "a step backwards. Dilnot brought to a close debates about whether the service should be universal and this proposal is opening it up again. Really this is about the Treasury finding a way of opening it up again. He also pointed out that in the past 13 years there had been two independent commissions, three public consultations and now three white papers. There is a financial vacuum at the heart of these proposals ... The success of longevity and an ageing population means that soaring care costs are inevitable and a no-cost option does not exist. The need to find a sustainable way of paying for care remains as urgent as ever. The Department of Health's analysis shows that a £35,000 cap on care costs and £10,000 on hotel costs would see the taxpayer left with a bill of £4.2bn by 2025. It also admits that "adding a universal element to a means-tested system will lead to an increase on spending on wealthier people since they currently get the least." This charge that Dilnot is a sop to the rich has been used by Treasury officials to scupper major reform. Andrew Dilnot, speaking on the BBC's World at One, said ministers "agreed with the principles" of his report. He questioned whether it was really unaffordable, saying that if the government capped care costs at £50,000 and hotel costs at £10,000 then the cost to the taxpayer would be "£600m, £600m and £700m" in the first three years of the next parliament. That is less than one 1,000th of [the government's] total spending covered by the comprehensive spending review ... If it is at least that important [to] transform the lives of vulnerable people, it is a price worth paying. Charities said the Treasury was "strangling reform" - a move that was troubling given that one in four over-65s were expected to require some form of care or support. Sir Stephen Bubb, chief executive of Acevo, which represents the voluntary sector's chief executives, said: "I smell the dead hand of the Treasury on this. They are strangling reform. But what they don't realise is the huge cost to the health service, which is mounting by refusing to take action on social care. We have a care system in crisis and a ready solution in the Dilnot report. The government's failure to act will be a bitter disappointment to charity leaders up and down the country. Jeremy Hughes of the Alzheimer's Society said: "Millions of vulnerable people had been promised radical reform but today they are being massively let down. Every day without a funding decision is another day where people, including those with dementia, face huge costs for often substandard care. If reports are true, this white paper is not worth the paper it's written on. Michelle Mitchell, charity director general of Age UK, said: "The government's commitment to the Dilnot approach in principle is an important milestone, but without a clear plan for how they intend to deliver on that commitment there are no guarantees the Dilnot recommendations will be put into action soon, or possibly even at all." Lansley also announced a scheme to allow local authorities to agree to pay in advance for care if individuals cannot afford to do so without selling their home. Councils could then recoup the cash when the house was sold when they died, leading some to dub this a "death loan." He also said councils would be forced to offer the public a minimum level of care and the Department of Health would stop councils from limiting who could get care. At present, councils are allowed to set their own eligibility thresholds for social care - which has created 152 different systems across England. More than 80% of local authorities have taken the opportunity to limit free care - such as home helps, meals on wheels and the installation of stair lifts - to only those whose needs are deemed "substantial" or greater. Lansley said: "It is our intention to base a new funding model on the principles [of Dilnot] if a way to pay for it can be found ... any proposal which includes extra public spending needs to be considered alongside other spending priorities ... the right place to do this is at the next spending review. We are taking definitive steps now to take forward a number of important recommendations made by the Dilnot commission. We are today committing to a universal payments scheme. This will ensure no one will be forced to sell their home to pay for care in their lifetime. Andy Burnham, Labour's shadow health secretary, told MPs: "Councils are already facing a major funding shortfall - estimated to be at least £1bn by all expert observers. They can't cope with what they already have to do, never mind being loaded with additional unfunded burdens and the pressure of falsely raised expectations among local people. He and the shadow chancellor, Ed Balls, called on the coalition to use NHS under-spends to help tackle the growing social care crisis. They said this year the NHS had not used £1.7bn of its budget - £1.4bn of which had now returned to the Treasury. Labour said the Treasury should allow £700m, half of the under-spend, to be ringfenced for social care budgets this year. Balls said: "I heard from local government leaders earlier last month their deep concerns about the future of this vital service, and about the heartbreaking decisions they are being forced to make right now. George Osborne's spending review, which has seen over £1bn cut from budgets for elderly care, has set social care on a collision course with crisis. The government must act both to address the urgent crisis we face - and to bring forward long-term reforms which they have committed to working with us to deliver. George Osborne and Andrew Lansley could and should act.