No insurance company would get away with this...

SHOULD elderly islanders be forced to sell their homes to fund their own care needs? It's one of the big issues under consideration by the States at the moment. The answer is as plain as a pikestaff. It's a big fat 'no', unless it can be proved there is really absolutely no alternative – and I simply don't accept that.

Why am I so emphatic in rejecting the idea of forcing elderly islanders to use their prime asset to fund their care? Not because I don't recognise that there are arguments on both sides. While I personally hate the idea, I understand that others see no reason to 'subsidise inheritance'.

My objection is far simpler. For the best part of two decades these same islanders have been paying contributions into the long-term care insurance scheme. Many may not have particularly wanted to, but it was compulsory. The upside was the copper-bottom promise that if they ever needed residential or nursing care, then the fund would pick up the bulk of those costs.

If the States reneged on that deal now it would be shameful. Indeed, if any private insurance company took premiums and then failed to pay out on a valid claim they would find themselves in court. Effectively, that would be just what the States were doing if they went back to the bad old days of forced house sales despite so many years of compulsory insurance contributions.

Let's take a step back and consider how to fund the ballooning amount of social care needed for an ageing population. It's certainly not a new question and I was involved in efforts to find an equitable solution many years ago.

Alas, it is an issue to which it's getting much harder to find an acceptable solution as our community ages remorselessly. Hence the current public consultation which includes that shocking suggestion of going back to requiring elderly islanders to sell their homes to pay for care.

Actually I suspect funding care for the elderly may not be the biggest problem that Guernsey's burgeoning number of older residents throws up. With fewer and fewer younger workers predicted (barring a huge rise in total population), where will we find the required carers, even if we can afford to pay them? But as it's the financial aspect which is the current topic of public debate, I'll focus on it too.

I'll start by looking back many years to the days there was no long-term care insurance scheme. Islanders were then expected to fund their own care requirements, with the States Insurance Authority providing a safety net for those without sufficient funds. That approach threw up all sorts of bitter arguments over perceived unfairness.

Those who had been careful all their lives and saved up for their old age were outraged that they were expected to fund their own care while the States picked up the tab for those who they regarded as 'feckless spendthrifts'. That wasn't always fair, of course. Not everybody had been in a position to save, particularly if they'd been in lower-paid jobs. But the criticism certainly had some validity.

Then there was the hoary old problem of the family home.

Exempt it from the assessment of someone's assets when calculating their payments and it was attacked by many as grossly unfair.

'Why should someone in rented accommodation be forced to spend their savings when a home owner has their biggest asset protected?'

'Why should the taxpayer subsidise inheritance?'

Go the other way and include the family home in someone's assessment and the complaints were even louder. 'Where is the incentive to work hard and buy your own home?'

'What will happen to the spinster daughter who's been living in the house for years nursing her infirm mother?'

'What about homes that have been in the same Guernsey family for countless generations?'

'Aren't you just going to encourage deliberate disinvestment?'

You really couldn't win.

How to cut through this Gordian knot? The neat solution was to bring in a universal insurance scheme to pay for residential and nursing care. The issue of how to calculate someone's payments then simply disappeared. If they needed such care the insurance fund would pick up most of the cost. With one in six islanders assumed to need it at some stage in their lives, it not only brought fairness but also huge peace of mind at quite a reasonable cost. But it wasn't a perfect solution.

The first snag was that it only covered residential and nursing care. That was rather unfair on those who wished to remain at home and buy in care. It was also inflexible in the face of the trend towards 'extra care sheltered housing' as an alternative to traditional residential homes.

The second snag was that the fund was never going to be sustainable in the long term at the initial contribution rates. I remember helping to sell the scheme as President of Health alongside the Insurance President, Deputy Owen Le Tissier.

We told States members the scheme should be self-financing for 15 years.

It has been. It's still just about washing its own face today and has built up a multi-million pound buffer fund. The problem? Outgoings are about to overtake incomings and demographic projections make it clear that if something isn't done soon the reserve fund will disappear PDQ.

So what's the answer? The obvious one is to put up the contribution rate.

The fact that everybody – both working age and retired – pays long-term care contributions makes that quite an effective option. If it were only those under state pension age who paid then you would be taking higher contributions but from a dwindling number of islanders.

The downside? Because general social security contributions may well have to rise too to fund the state pension it might make Guernsey less competitive. That's the fear, at least, but I'm not fully convinced.

Firstly, employers don't contribute towards this particular benefit, and secondly, social security payments are likely to be on the rise in our competitor jurisdictions too as the whole developed world faces similar demographic pressures.

I know no one wants any States levy to go up after the remorseless rises in taxes and charges over recent years. I certainly don't. But here is one issue where I don't think there is a real choice.

More elderly care will be needed so more money must be found. Better by higher contributions than by stripping people of their family homes when they have been paying contributions for years to avoid just that outcome.

Such a solution will feel like a gross act of betrayal by the States of Guernsey.