28/08/2012 Newsnight Scotland

finally be about to fulfil its Tonight on Newsnight Scotland, free

personal care for the elderly costs are spiralling upwards. Should we

take a leaf out of the Dilnot Commission and consider means

testing. We ask the Deputy Prime Minister if the Scottish Secretary

will survive the reshuffle? Good evening. How affordable is the

flagship policy of free personal care for the elderly? New figures

published today by the Scottish Government show the cost of

personal care has more than doubled in the past seven years. So, time

for a rethink? We're all at different stages in

life, one thing unites us whatever our age - we're all getting older.

We're all living longer, that's the good news. The difficult bit is

what happens when we get old and more infirm. Who's going to pay for

it and how much twil cost? Free personal care for the elderly

remains a defining policy of post- devolution Scotland introduced by

the Labour -Lib Dem coalition introduced by Henry McLeish. No ifs,

buts or maybes, full implementation and fully funded. But the cost of

helping people with personal care, such as washing and dressing in

their own homes, has increased from �133 million in 2003 to �342

million in 2010/11. To say the demographic and financial

implications of the policy are challenging, is an understatement.

In evidence to the Scottish Parliament, the association of

directors of social work said the current bill of around �1.3 billion

a year for all social care, of which free personal care is a part,

would rise to �2.7 billion by 2035. That doesn't take inflation into

account. In England, the Dilnot Commission into social care has

recommended that people who can should contribute to their care, up

to a capped maximum of �35,000. three major political parties are

behind these reforms. All of the major stake holder groups, the

population as a whole, a recent poll found the huge bulk of the

population thinks this is the way forward. Here the directors of

social work think the time has come for a review of free personal care

in Scotland and that review should consider means testing. I think

that's probably quite a responsible policy because it means that those

who can afford to do so then contribute to the wider costs,

which ultimately help those in most need and those that are most

improfferished. Not everyone sees things that way. Age UK, which

represents elderly people, points out that while free personal care

costs around �5,000 a year per person, it costs around �25,000 for

someone to stay in a care home. What is surprising is that people

want to keep sort of hammering free personal care and saying it's

unsustainable, when it is one of the few areas where we're actually

saving money. It's a preventative spend and it works. So the future

of free personal care is an especially difficult political

issue in times of austerity, but for the moment, the SNP say it's

staying. If we are to meet the demographic challenge we have in

Scotland with an ageing population, we have to provide resource to meet

those needs. We're committed to continuing with free personal care

for older people in Scotland. Many thousands of older people in

Scotland are benefiting from that. It carries broad political support

in Scotland as well. Others such as the Scottish Conservatives warn

that a responsible government in Scotland can't ignore the facts,

kidding everyone that everything is affordable. Clearly, the political

temperature on this issue is rising. We're joined now by Professor of

economics at Strathclyde University, Robert Wright. First of all, we

heard David there allude to the scale of the demographic changes

which will be undertaken in Scotland. Give us an indication of

just how quickly increasing is the ageing population? Clearly the

population of Scotland is ageing rapidly. The number of people in

the 65 and over age group, over 85 is going to increase dramatically

in the future. This is pretty certain. That implies there will be

more people eligible for free personal care in its current

configuration. We see take-up rates increasing. It's hardly surprising

that the forecast is that this will be a larger amount of money that we

have to come up with. If you're the director of social work you look at

the budget. You see this is increasing speedily and it's going

to continue to akselbrait. Therefore, you think, is this

affordable? When you see big numbers increasing, you always ask

questions, if it's affordable or not. That's not the issue. I think

the issue was mentioned in the film. You have to think about the

alternative. Let's say we get rid of free personal care for the

elderly. You will get a big increase in people going into

institutional care, which is much more expensive. Basically what free

personal care does, one of the outcomes, is it allows people who

want to live in their home to stay in their home longer. This is

cheaper. The ageing population process will continue for another

four or five decades. It's a longer term problem. You have to think

about this longer period of time. It's my view, and many people's

view, that over this period, when we're expected to accommodate the

ageing population, policies like free care for the elderly are going

to be cheaper. They're going to have to be paid for in some way.

What about the idea that's floated by the Dilnot Commission, which is

let's have a cap of �35,000, so we means test the benefit so those who

can afford to pay should pay. should be the situation. The Dilnot

has a number of �35,000, that's just a number. The idea that people

who can afford to contribute to their care should be expected to do

so is just how we manage it and how much we are expecting people to pay.

Is that an economic decision or political decision? It's both. If

you're means testing you have to have a bureaucracy to carry out the

means testing and that is not cheap. We don't really have that. Often

these processes, organisations are very inefficient and there's cost

to that. I think the politics of this is delicate because the ageing

population is also a population that has clear voting

responsibilities and rights. Anybody that tries to remove free

care for the elderly or water it down will pay serious punishment at

the ballot box. It's a policy that's popular because I think in

the longer run it prove to be cheaper. Plus it's what people want.

We can't forget that politicians at least try to provide us with things

that they want. People tell us that they would like to stay in their

homes as long as possible. This allows that. It's tough. Is this

kind of benefit fair to those generations who are say 18 years

old just now, you're going to have to spend your working life helping

to pay for these benefits. By the time you get round to being old

enough they won't be available. That's the problem with an ageing

population. This idea of it's not fair, younger generations pay for

older generations. I'm afraid that is just the way it is. That can't

be changed. The alternative is to remove these programme, remove, pay

less money to accommodating the ageing population and have them

experience a lower standard of living. This is the alternative.

No-one is talking about that. Accommodating an ageing population

is going to be expensive no matter how you do it. I think a policy

like free personal care for the elderly and if you want to means

test at the upper end, you know, it's a winner. Why do you think

this is something which often leads to controversy? What are the

arguments put forward by proponents of it is you should treat older

people who need care the way you treat somebody who arrives at A&E,

why is this different? Because of the ageing population. It's the

scale of the problem that makes it quite important. It's a huge issue.

Do you think somebody living here in Scotland that you will benefit

from free personal care? I would like to see it, maybe not free

personal care, but the fact that the Government subsidises personal

care services and provides those When this was first introduced, it

was hailed as Scotland leading the way in many aspects of this policy,

how do other countries deal with this? Most other high-income

countries have some form of what they call home help, which is what

the personal care actually is. It is just a matter of how they

finance it. Mostly they expect an individual to make some kind of

contribution to that? If they can. But they have clear rules on who

can and who cannot because in many countries have a longer history of

means testing welfare than Scotland or the United Kingdom. The 35,000

figure which has been plucked out of the air as far as you're

concerned, what should be a suitable means testing figure in

Scotland? I really don't know, because basically what you have in

Scotland is you have a major policy, you have a small number of

researchers working on this. Much of the work, I think, centres

around what the Government is doing and is not very illuminating. We do

not really understand these questions as well as we should. The

challenge will be to provide the sites which will allow us to inform

judgement and changes to the law. The Liberal Democrat leader Nick

Clegg has returned from his summer holiday and gone straight on his

travels again. He was in Jes Fry in the Scottish Borders visiting a

coat hanger factory, hot on the heels of recent figures showing the

Treasury borrowing more than their spending, I asked the Deputy Prime

Minister what strategy the Government has for cooling the

economy. When asked people what they wanted most from Government,

their simple request was for greater certainty when the status

of Scotland within the next kingdom, which they set cast a shadow of

doubt about the future of companies like this. And also about the

future of the Eurozone. Like all businesses, it is a certainty which

is such a powerful ingredient for inspiring that all important thing,

confidence. Certainty comes in many shapes and sizes and I certainly

think in Scotland, having certainty about the future of Scotland is one

of the biggest boost speed can go to companies like this. We're in a

double-dip recession, did you expect this two-and-a-half years

into Government? I do not think anyone could say hand on heart that

they could have foreseen what has happened to the economy in the last

two-and-a-half years. Clearly, to they have years ago, everyone hoped

that the shot that had been suffered duty grass of the banking

system was one be could recover from relatively quickly, but that

has not happened. We have been try to deal with the black hole in our

public finances but it will take us longer to do that. There are many

debates on how you can restore a sense of confidence and growth,

some people large one way and see it is all about one runway any

particular airport, others say that a little of borrowing will do the

trick, my own opinion is that the key ingredients are sorting out the

banks, people, getting more money into people's pockets, which is why

the up listing personal allowance is so important. As his lauding

inflation. Also, infrastructure. Investing in green Infrastructure

and energy infrastructure and backing. If you get banks, people

and infrastructure correct, that is an important recipe for the British

economy. All very good, but none of it is working. That is not fair.

We're any double-dip recession. There are certain things that our

economic fact, that politicians somehow it airbrush out of the

equation. These Eurozone Castile shadow of uncertainty not just on

the British economy but on the whole global economy. Many people

have only come recently to fully appreciate the damage that was done

back in 2008 when there was this cardiac arrest in the banking

system. The latest Obi are estimate are that he British economy will be

a full 11% smaller come 2016, and it would have been if that shop had

not happened in 2008. The damage done to the basic transmission

mechanism in the British economy is deeper than people realise and it

will take longer to recover from, but he will recover from it at heel.

They have spoken of uncertainty around the independence referendum,

as you Government struck a deal with Alex Salmond's Government on

how many questions there will be? Know, there is no date in the diary

for a meeting between Michael Moore, the Secretary of State for Scotland,

and Alex Salmond, the First Minister. We in the British

Government recognised that the SNP Government have every right, they

have a powerful and democratic mandate, to hold the referendum. We

want to work with them to facilitate this. We believe it

would be better if the referendum was held sooner rather than later

in order to dispel uncertainty, we also believe it would be better if

it was a simple single question that was easy to understand and

road receive a E or any answer from the Scottish people. We would hope

to, instead of jockeying around a process points, to settle on the

steep hills and have a debate on the future of the United Kingdom

and Scotland's place in it. We're told that the Prime Minister is

relaxed about the autumn 2014 timetable, Hagia relaxed about it?

We believe it would be better if it was held sooner rather than later,

but at the end of the day we will not make a date in the diary for

something that will die in the dictionary. What about a vote for

16 and 17-year-old? We believe there should be a consistent

approach for the age where people participate in elections, but for

us the most important thing is that there is a clear it legally binding

and simple toys put before the British people, the Scottish people.

We believe a series of old will choice questions will be confusing

and would play cat-and-mouse with the Scottish people. We need

clarity. So what's for 16 a 17- year-old is up for grabs? We want

to engage with the Scottish Government, or we want to work with

them to make it possible for them to fulfil their democratic right to

hold a referendum. What I find curious is that you have the SNP

talking about independence for 70 or 80 years, now it does not seem

to know what it means by independents, chopping and changing

what it means for the currency and the monarchy and NATO and so on,

and now it is extremely reluctant to finalise the details for

something that it has said for several decades that it wants.

Salmond insists on having a question on more powers for the

Scottish Parliament, what will you Government to? Hold their own

independence referendum? We want to work co-operatively with Alex

Salmond and his administration to facilitate a referendum. You are

inviting me to speculate, what if, what if. To be fair, the Scottish

Government has said they are open to the possibility of the two-

question referendum, you have said clearly that he won the one

question referendum, that is a legitimate public debate. That is

not true. The SNP's and formal commitment is to one question.

Salmond has made it clear he will consider a second question. So

given the fact that the Scottish Government is considering a second

question and you do not want Waugh, if he forces the issue to have two

questions on the ballot paper, will you in return, despite

protestations... I am not really interested in hypothetical

questions on the back of meetings that have not taken place, what we

believe is best for the Scottish people and for the Scottish nation

is to put a single question as soon as possible in a clear and simple

way before the Scottish people. Alex Salmond and his administration

have every right to do so. We have said very clearly, as have many

people, that it is best done through a single question. We

cannot make progress on that until there is a date in the diary for a

meeting between Mick Moore and Alex Salmond. You could end the

speculation by saying that the UK Government's policy is not to hold

an independent referendum. It is better issue get picked were at

Alex Salmond talking to each other rather than you and I second

something that they should settle at a meeting that has not yet taken

place. Let's have was meeting cent get a date in the diary. We have

been clear about her priorities, most objective observers and the

SNP believes that the question is as important as the future of

Scotland in the United Kingdom is best settled but a straightforward

yes or no response, a step forward simple single question. Mick Moore

has been doing much to the negotiations for you, will he

survive the reshuffle? composition of the Government will

be made obvious soon enough, when the reshuffle was announced. Let me

say that I have been immensely impressed with the way in which

Mike has patiently and professionally and consistently

dealt with the endless game-playing from Alex Salmond, has been

consistent and professional in saying that what we must denial is

facilitate the referendum which the SNP has every right to hold an be

clear about the manner in which we think that referendum should be

held. I think that kind of consistency and patience and

professionalism that something I Fahy and something that many people

in Scotland fuggy as well. A quick look at tomorrow's papers,

starting with the Scotsman which leads with calls for reforms as the

cost of elderly care soaring, as we discussed earlier.