January 21, 2014 / 12:05 AM / 4 years ago

UK to cut red tape on saving to fund care in old age

LONDON, Jan 21 (Reuters) - Britain is planning to cut red tape for financial companies developing products that help people save enough to avoid having to sell family homes to cover the cost of care in old age.

The Minister for Care and Support Norman Lamb will sign a statement of intent with the Association of British Insurers on Tuesday, setting out a framework for the financial industry to better provide for people saving to fund social care.

Among targets being announced are a pledge to improve access to information and advice on how to save effectively and “create the right conditions for a larger market of financial products”.

The government is due to introduce legislation in April 2016 that will limit the amount people can be billed for their own care when they are elderly to 72,000 pounds ($118,200).

To complement this, the government hopes the financial services industry will develop an effective system for people to save through their working lives to pay these bills and avoid losing their homes or other assets.

“People face losing almost everything they’ve worked hard for or being forced to sell their family home in a time of crisis to pay for the care they need,” Norman Lamb said in a statement issued ahead of the pledge.

“Our reforms will not only stop this from happening but will provide the industry with the certainty it needs to develop products that can help people plan for the future.”

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