The New Care Cap the Government is Mooting

The government is introducing a new care cap that will limit the costs that people pay for care throughout their lifetime. From October 2023, those arranging for home or residential care will not have to pay more than £86,000 in lifetime costs. Anyone with assets worth less than £20,000 will not be required to contribute towards the costs of their care from their assets.

As those who fund care themselves pay higher prices than those who access it through the council, this comes as part of the government’s efforts to address “persistent unfairness” in the social care system to ensure that those who need care can find the best price. 

What Has Changed?


As it currently stands, local councils will not assist individuals with assets worth over £23,250 with care costs. Instead, only those with assets less than £14,250 will receive full financial support. The hike in funding is supported by the planned increase of National Insurance to 1.25%. A majority of this will help the NHS recover from the effects of COVID-19. However, £5.4bn is earmarked to fund adult social care over the next three years. 

To determine how much you will be liable to pay for care should you need it, a means test will be carried to review your assets. Below, we have highlighted what may be expected based on the total sum of your assets.

  • Assets over £100,000 – You will be liable to fund your own care. However, your local authority will take over after you have spent up to the £86,000 cap on care fees. If your assets dip below £100,000, you may be able to access financial help.
  • Assets between £20,000 – £100,000 – You will be eligible for financial aid to supplement your care fees. You will be means-tested to assess precisely how much you will need to contribute. You will also be expected to contribute some of your salary and no more than 20% of your chargeable assets. 
  • Assets below £20,000 – You will not need to contribute towards care from your assets, but you may need to contribute from your income. 

This is a massive boon to those who need to fund care. A Which? Survey from January 2021 revealed that 24% of people going into a care home needed to sell their homes to support the move. The average cost per week of a care home in the United Kingdom was £674 in 2019-2020, and charities have estimated that up to 1.5 million people do not have access to the care they need. 

A Positive Change?


These changes are designed to help relieve the pressure on the strained social care system and provide access to care for more people who need it. However, there are exceptions and limitations to this cap that will still impact people.

The cap will not apply to daily living costs, including food, energy, and accommodation. Care homes do not usually itemise these, so it is unclear how much people should be prepared to pay for them. 

There is also a question of how long it would take people to hit this care cap. The average cost of a care home per year is £36,000. If personal care is taken off of this, it could be reduced significantly. Care that you receive in your home does count towards the cap. However, it is cheaper due to reduced accommodation costs. It also means that people would have to receive care for longer to hit the cap. 

High costs could still be incurred by those who have high care needs, despite the intentions of the cap. However, assistance from the council is available and could alleviate some of the financial strain from those who need it most.

Some are worried that the money to be invested in adult social care will be used to cover the cost of the cap. Many also express their concerns that it will not be received by those who need it the most. Other concerns have been raised about staffing issues in the care sector. Many are struggling to recruit more care workers, which could lead to a decline in the quality of care offered in the future. 



Whilst the care cap sounds like a change for the better, more information and clarity are needed from the government to assess how the costs will work out. The main point of confusion is the personal care costs. These can still be expensive and may lead to people selling their houses to fund care.

More details are expected to be released in the next few months to clear up some of the finer details, with extra information and support expected to be announced for unpaid carers and professional development to be improved for care home staff. 

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