National Wealth Service
The system of charging for various NHS services "is a mess" according to a
powerful parliamentary committee, with many people exempt who could pay and
others who are hard up getting no help. In a damning report the committee says
that charges have a negative effect on health, and calls on the Government to
examine the effect of abolishing all existing charges. When the NHS began there
were no charges. But from 1952 prescriptions cost a shilling and dentists and
opticians also began to impose charges. Today a prescription for adults under 60
costs a whacking £6.65 (£3 in Wales and set to be abolished there next April).
But the report says barely one in eight prescriptions is paid for. If everyone
paid a flat rate of £1 per item with no exemptions even for those over 60, it
would bring in an extra £120 million. The MPs call on the Government to examine
making the charge flat rate for all or scrapping it completely. Failing that,
the MPs say the Government should at least review the list of illnesses that
entitle people to free prescriptions. Since this list was drawn up in 1968 new
diseases have been identified, others have become treatable. The result is that
some people with long-term illnesses have to pay, while other conditions like
insulin-dependent diabetes are exempt. The committee also criticised the charges
for dental care and glasses. At present everyone has to pay – there is nothing
free for the over-60s apart from an eye test. People on a low income with
savings under £16,000 can get dental care and some spectacles free or at reduced
cost, but the committee called for changes to the complex application form. One
member said, "I am absolutely horrified. It is the most impossible form anyone
could fill in." The NHS also raises money in other ways. More than 90% of
hospitals in England charge for parking. In Wales the figure is about half but
only one in 20 in Scotland. The average fee is £1.22 an hour but some charge up
to £4. There are no concessions and parking can become very expensive if you
have regular treatment or have a relative or friend in hospital for a long time.
The committee wants new rules so that frequent visitors can buy season tickets
and patients who have to visit regularly are exempt.
Yacht spotters
Forget the notebook and pencil on a wet railway platform. A growing number
of people are swapping their anoraks for shorts and deck shoes as they go yacht
spotting. They prefer the harbours of Monaco or San Francisco to Clapham
Junction. A new breed of spotter is keeping records of where large yachts are
and sharing their research on the internet at yachtspotter.com. It tracks "megayachts"
– more than 100 feet (30 metres) long – through a network of spotters.
Enthusiasts also track the changing names and refits of yachts but there is very
little information about who owns them. And with some prices in the tens of
millions that would be interesting.
Equity relief
Each year around 45,000 older people raise more than £1 billion by taking
out a lifetime loan against the value of their home. It’s called ‘equity
release’ and on average they raise £24,000 each. But what do they spend it on?
Research by Norwich Union shows a remarkable consistency month by month over the
last eight months. The insurer now asks everyone who borrows money against their
home – nowadays called a lifetime mortgage – what they use the money for. Top of
the list is repairing or improving their home with nearly three out of four
using some of the money that way. Nearly four out of ten use part of it to go on
holiday. Norwich Union says one customer used it for an annual visit to see a
long lost brother – trips he could not otherwise have afforded. A fifth use some
of the money to help grandchildren and others with the cost of university fees.
Brendan Kearns, product development manager at Norwich Union, says that it takes
nine to twelve months from thinking about equity release to actually taking what
can seem a difficult step. "One of these reasons will trigger the desire for
equity release – savings below a certain threshold, need money for car, home
improvement – that is the trigger. But then they think what else do I need money
for? And they will take out a plan with multiple reasons and do a number of
different things." On average the research shows people use the money for more
than two separate purposes.
Care homes fees
Many older people in care homes are being wrongly denied up to £62.25 a week
towards their fees. The benefit is called Attendance Allowance and almost
everyone ill enough to be in a home would be entitled to it. However, anyone who
gets help with their fees from the local authority cannot claim Attendance
Allowance. And this is where the errors creep in. Two groups can claim it, even
where they are getting help with their costs. Everyone who needs nursing care in
a home gets a contribution towards the cost. In England, Wales and Northern
Ireland (but not in Scotland) this contribution does not prevent them getting
attendance allowance as long as they pay the rest of the costs themselves.
Second, anyone in a care home who has left their home empty or is renting it out
can get their fees paid by the local authority. But when they die the home will
be sold and their fees repaid to the council out of the proceeds. Although they
are getting help from the council it is a loan and so they are still
self-funding and can get Attendance Allowance. However, experts say that DWP
staff are getting these complex rules wrong and denying both groups of people up
to £62.25 a week that is rightfully theirs.
HIP swing
Just days before our critical column on the new Home Information Packs was
published in the August Saga Magazine the Government announced a U-turn. Part of
the HIPs will not be compulsory when they start in June next year. You will
still need the local searches and legal information and you will still have to
have an inspector calling to prepare an Energy Performance Certificate on how
efficient your home is to heat and light. But the Home Condition Report on the
fabric and structure of your home will not be compulsory – and may never be. Bad
news for the 4500 people who are training – at their own expense – to be home
inspectors who will now have much less to do. And bad news for estate agents who
were hoping to make money out of HIPs – many saw their share price tumble. And
not great news for sellers – the cut back pack will still have to be paid for
and will give the buyer even less information.
New Saga guides
This month Saga is publishing its first free guide to money, which will be
essential reading. Saga’s Guide to Pension Reform untangles the complicated
reform of the pension system outlined by the Government in May. The guide, which
I wrote, makes sense of the changes proposed in state and private pensions. You
can get
download it to your computer now from our new-look website. On the new
website you can post your views about the proposed pension reforms and share
your thoughts with other website users on these and many other issues.
September 2006