17/07/2015 15:30 BST | Updated 17/07/2016 06:12 BST

Government Delays £72,000 Cap On Social Care Costs Until 2020 Amid Funding Fears

Plans to introduce a cap on social care costs from next year have been delayed until 2020 amid fears over how councils would fund the move.

Ministers confirmed that the £72,000 limit on bills for residential care was being pushed back to the final few weeks of the parliament after "genuine concerns" were raised about its introduction.

The cap was one of the key measures included in the coalition's Care Act to protect people from staggering bills and avoid the need to sell off the family home.

But earlier this month the Local Government Association (LGA) wrote to Health Secretary Jeremy Hunt calling for the measure to be delayed, warning that the funding gap in adult social care was growing by a minimum of £700 million a year.

Izzi Seccombe, chairman of its community well-being board, said: "The announcement to delay the second phase of the Care Act is a positive recognition from government of what the LGA has been warning - that we cannot try and reform the way people pay for adult social care when the system itself is on such an unstable foundation.

"In an ideal world, we would have funding for both the system and the reforms, but we have to be realistic about where scarce resources are needed most," she added.

Charities said the move highlighted the strain the social care system is under and called for "significant" investment to bring it back from the brink of collapse.

The cap on elderly and disabled care was set at more than double the £35,000 recommended by the independent Dilnot Commission in 2011 and does not cover accommodation and living expenses.

Ministers insisted, however, it would ''give everyone peace of mind by protecting them from catastrophic costs''.

Under the reforms, the limit on assets that stops people being eligible for help towards their costs was due to rise from £23,250 to £118,000.

Plans to oblige councils to help people who pay their own costs - known as self funders - find residential care are also being delayed.

Officials said the Government was still fully committed to introducing the cap within this Parliament but wanted to make sure it was workable from day one.

In a letter to the LGA, social care minister Alistair Burt said: "We have taken the difficult decision to delay the introduction of the cap on care costs system and that this will now be introduced from April 2020.

"I want to assure you that this is not a decision that has been taken lightly, but one that has followed from consideration of the genuine concerns you have outlined."

"The consultation earlier this year highlighted significant concerns about this provision and the extra time will enable us to better understand the potential impact on the care market and the interaction with the cap on care costs system," he added.

"We will also now defer the introduction of the proposed appeals system for care and support to enable it to be considered as part of the wider spending review that will launch shortly."

Government funding to local authorities was cut by 37% in real terms over the last parliament.

Last month, the National Audit Office warned that councils could find themselves forced to cut services due to a potential shortfall in funding for major changes to the social care system as the first phase of the Act was introduced.

Caroline Abrahams, charity director for Age UK, said: "The Government is right to delay implementing the cap on care costs as the top priority must be to stop the social care system that millions of older people depend on from collapsing in its entirety. 

"At the moment there are growing concerns that the social care system is in a cataclysmic state of decline and unsustainable on its current basis. From this point of view, introducing the care cap would have been a distraction.

"What matters now is that the Government grasps the scale of the galloping crisis in social care and uses the spending review to bring forward effective solutions, which must include significant investment to fill the funding gap that is at the heart of the system's difficulties. The clock is ticking."