Fiscal Sustainability (Demographic Change)
Item 3 is the first of our round-table discussions on fiscal sustainability. In today’s session, we will focus on demographic change in Scotland.
I welcome to the meeting Professor Robert Wright, who is professor of economics in the department of economics at the University of Strathclyde business school; Professor Charlie Jeffery, who is head of the school of social and political science at the University of Edinburgh; Dr James McCormick, who is Scotland adviser to the Joseph Rowntree Foundation; Professor Carol Jagger, who is professor of epidemiology of ageing at the institute for ageing and health at Newcastle University; and last, but certainly not least, George MacKenzie, who is registrar general, keeper of the records and chief executive of the National Records of Scotland.
As the committee will take evidence in a round-table format, there will be no opening statements. We will proceed straight to questions.
I will throw out a question that anyone can pick up. People will be able to come in as they catch my eye, and we will be able to have a swift-moving and productive discussion, I hope. People can come in on a topic as often as they wish, but it may be that not everyone will come in on every issue. Please do what you can to catch my eye as we proceed.
All members have been presented with papers. In paragraph 6 of paper 1, there is an interesting quote that relates very well to the committee’s work on the preventative spend agenda. The first sentence of the paragraph says:
“If, as a country, we are to achieve a sustainable social care system, ways have to be found to make prevention and early intervention work for older people.”
How can we take that forward? Do not be shy in answering.
Dr James McCormick (Joseph Rowntree Foundation)
Thank you for the invitation to join the committee today.
The Joseph Rowntree Foundation’s approach would be to say that we should start upstream and talk about the kind of support that older people need to live well in society before we even get to considering how to reform social care and health services that are further downstream. The more we can talk about light-touch and low-cost preventative interventions, housing adaptations, handyman services and gardening support, the better. We know from our work that those are the kind of things that older people value most. That is their starting point. Thinking about the quality-of-life agenda is critical.
One unsustainable faultline that is built into our system is the fact that we spend about four times more on emergency admissions to hospital for the over-70s than on the entire free personal nursing care budget. That is an example of a system that is not resilient enough and defaults to emergency hospitalisation. We could do much more to increase resilience at the community level to avoid unnecessary hospitalisation and to speed up people returning home from hospital. A positive aspect is that much better evaluation evidence about how to do well in that regard is beginning to become available. I guess that one of our tests or challenges in Scotland is to find out how committed we are to acting on the evidence around prevention and saving money in the longer term.
As members know only too well, there are huge challenges, but we have better evidence now than ever before about how we can change the trajectory and get into a lower-cost, more sustainable pathway in the future.
Professor David Bell (Adviser)
I will follow up on what Jim McCormick said. It seems to me that evaluation is very important. There is no centralised location or repository for evaluative evidence in Scotland. I have been involved in a Europe-wide project that looked at telecare interventions. We found that there are not only hundreds but probably thousands of little interventions that physicians have decided would be a good idea, but which are not taken forward. We do not know whether they work, because the evaluations have been poor. If we want to know what works, we must have a system that will enable us to evaluate the evidence coherently.
Professor Carol Jagger (Newcastle University)
I agree.
The current landscape is different as a result of the growing number of the very old—that is, those who are 85 or over. They do not get into evaluative studies, so we have even less evidence on what works for them. That is a challenging and important group because people in it have a lot of co-morbidity; they do not have just a single disease. It might be considered okay to get someone back home quickly from an emergency admission if they have only one condition. However, older people fall through the gaps in the healthcare system, perhaps because we concentrate just on the most important condition and forget the others, which means that such people are not treated holistically. That is true not just in Scotland but everywhere.
I note from your written submission that you studied 850 people aged 85 or over who all had multiple morbidity, with an average of four or five conditions each. Perhaps that is something that we will all face at some time. I also note from one of our documents that the number of people aged 85 or over is expected to grow by 144 per cent over the next 20 years.
Professor Jeffrey is next.
Professor Charlie Jeffery (University of Edinburgh)
Thank you for the invitation. You might have an outbreak of consensus among the witnesses here today. I want to make a point that overarches some of those that others have made. A decade or more ago, we were in danger of painting older people as a terrible problem and a fiscal calamity that faced us all. However, we have quite successfully moved to a different concept of older people as active citizens who make a valuable contribution to our society. There is a worry that the current fiscal tightness at all levels of government in the United Kingdom and more generally will draw us back to the fiscal calamity argument. We should do what we can to avoid presenting the problem in that way.
One way of doing that is to distinguish between different groups of older people. The old are not a single uniform group; they are a very diverse group of people. Professor Jagger pointed to one element of that diversity—the older old, who tend to accumulate several disabling problems that prevent active citizenship. However, we should not forget the younger old, who typically do not have such an accumulation of disabilities and who provide all sorts of social and economic benefits, not many of which are costed, but which are highly significant to our society.
One element of diversity that we have not yet touched on and which is particularly significant in Scotland is the situation of older people in rural areas. The challenges to active citizenship or to interventions to mitigate disabilities in thinly populated rural areas are very different and often much harder to deal with. If we produce one-size-fits-all solutions, we may not be serving all our older citizens in effective ways.
My final point responds to what David Bell said about telecare, which offers enormous possibilities. We do not yet have a good understanding of what the effects will be. The use of new technologies presents enormous possibilities in maintaining the social independence of older people who are experiencing a disabling problem.
There are big issues with the take-up of new technologies by older people. There is a need and an opportunity for public institutions such as the Parliament to work hard with and to expect more from private sector institutions that work in the new technologies field in producing technological interventions that really work for older people.
George MacKenzie has indicated that he wants to speak, but I had been going to bring him in at this point anyway, as I want to ask him about the projections of National Records of Scotland that suggest that Scotland’s population will age more rapidly compared with that of the UK as a whole.
George MacKenzie (National Records of Scotland)
That is correct.
There are some points that I want to pick up on. Professor Bell made an interesting point about a repository for evaluative evidence. That is a valid point—we need better evidence. The raw material for some of that is already in existence in my organisation and in the Information Services Division of the health service in Scotland, in particular.
One of the challenges that we are looking at is whether we can make better use of that data and share it more effectively than we have done up till now. I want to bring that challenge to the committee’s attention. Data linkage will be crucial to our better use of evidence in the future. I do not underestimate the challenges of going in that direction. There are legal and ethical challenges, and public perception is a huge issue. The public sector collects a great deal of data on individuals for different purposes, and we do not always make the best use that we could of that data. We collect it for one purpose but, for legal or ethical reasons or because of public perception, we sometimes cannot use it for another purpose. That is a challenge that we need to address.
The second point that I wanted to pick up on is the one that Professor Jeffery made about the inconsistency of ageing. That is a definite issue. It is quite clear that rural areas have an older population and that the population in those areas is ageing more quickly than the population in urban areas. I guess that that is to do with the fact that there is more economic activity in urban areas and the tendency of people to retire and move out to rural areas. That means that we will have quite different patches of older populations in different parts of Scotland, and it seems to me that that is a challenge for local authorities and for Government, because there will be quite different issues and requirements in different areas of the country.
The convener asked about the projections. I am not a statistician—I came into this area of work six months ago when I became registrar general for Scotland. To have a better understanding of projections, we must be clear about their limitations. When we make a projection about population, it is just a projection. A population projection is based on the evidence of trends; it is not based on policy. It is our best guess of what will happen if current trends continue. The further forward that we go in a projection, the less valid it becomes, so a degree of care is required when we look at the figures. We have been criticised in the past for pushing the projections particularly high.
10:15
The fact is that the Scottish population has changed in the past 10 years. From about 2002 the population, which had been falling, began to increase again. That is partly due to a slight improvement in the birth rate, but it also has a lot to do with in-migration. We have to recognise that in-migration is the big thing that is pushing up Scotland’s population.
Although our population is not rising quite as fast as that of the rest of Europe or the United Kingdom, it is rising. We believe that we are now probably at a historically high level of population in Scotland. Last year, we recorded that the figure had gone up to 5.22 million. The highest recorded figure previously was 5.4 million in 1974, and I believe that we may have exceeded that figure now. Certainly, all our different projections and all the variants that we have suggest that the population will continue to increase. That is the background against which the committee needs to consider the situation.
Committee members have been remarkably docile so far. Perhaps they are reflecting on the interesting and important comments that have been made. Now that I have said that, Mark McDonald and Gavin Brown want immediately to leap in. I was about to move on to another issue but they have both indicated that they would like to contribute.
My question is about migration. I was struck by the point that is made in the submissions that if the working-age population does not increase—indeed, it might decrease—while the non-working age population increases, we may need to consider migration as a way of resolving some of the issues. George MacKenzie said that although Scotland's population is growing, it is perhaps not growing at the same rate as that of other parts of western Europe. How can we better reflect Scotland’s needs within the current framework? Could the policies and proposals that are being put in place to cap migration hinder our efforts to increase the number of working-age migrants who come to Scotland?
We were not being docile; we were being polite and well mannered—
—-because that is what you usually are.
I will pick up on a point that is made in paragraph 6 of Professor Jagger’s submission. We touched on the issue briefly before the evidence session. Professor Jagger’s submission refers to life expectancy increasing for males and females. The research that she presents indicates that there has been a compression of disability for men but an expansion of disability for women. I ask her to expand on that and give us more detail.
There is currently no real explanation for that difference. In another project, I am looking at differences in disability-free life expectancy at the local authority level in England and Wales and at what is driving the trends, so we will get more idea of why there is a difference.
Women always report more disability than men and tend to be more disabled than men, but I have no idea why that is. The trend has just started to increase for men; it had been pretty static previously. I do not know whether that is a blip or whether it will continue. Perhaps one reason for the difference is that coronary heart disease mortality has been reducing in men. That is one disease for which more men than women have been treated and it is a cause of disability, so that might be one reason.
I have questions on four or five things, but I will concentrate on a couple. First, we have talked a lot about Scotland’s ageing population. We know that there are increasing demands on the health service as a natural result of having an ageing population, but we also know that people are leading less healthy lifestyles than when today’s pensioners were growing up. Are there any messages that we need to take on board about not only the impact of the ageing population but how unhealthy that increasing population of pensioners will be as we go forward?
Secondly, population growth in England is growing at a much faster rate than in Scotland, even though we have had an improvement in the projections for Scotland. Are there any implications for housing and the balance of resources that we put into improving the quality of housing as opposed to building new houses? Because there is more rapid population growth in England, there is perhaps a need to build more housing units to accommodate more people, but in Scotland we have an historical problem of poor-quality housing that we need to address. If we do so, it might help to improve the health and quality of life of people who are already living in Scotland.
I think that Professor Jeffery wants to comment on something that was said earlier.
Yes—thank you. On Mr McDonald’s point about migration, there are two aspects. One is the distinctive understanding of immigration in Scotland as compared with that of the UK Government, which has often defined immigration as a security threat or, more diffusely, as a cultural threat to the fabric of the nation. The security threat issue is not part of the debate in Scotland and the cultural threat issue is very much a suppressed part of the debate. It is important for the Scottish Parliament to continue to press the UK institutions to be imaginative about immigration and to reflect the different understanding of the issue in Scotland.
I want to make a slightly different point about older people, because I am not sure that a focus on the economic dynamism of younger immigrants is the only answer. Another is to release the talents and energies of the over-65s. Given changes in retirement legislation, we do not stop at 65. We can go on and on, and many people have the abilities and the will to do so. A question is whether our employers are yet fully willing to recognise that and to adjust patterns of employment to get the best economic benefit—for their firms and for the Scottish economy more generally—from older people.
Professor Jeffery said that we should not be too negative in our approach. In the report that he did for Age Scotland, he refers to terms that are not helpful, such as “crisis” and “time bomb”.
Mr MacKenzie’s paper states:
“The dependency ratio ... is projected to rise from 60 per 100 in 2010 to 64 per 100 in 2035.”
That seems quite a small increase. I know that there are other, more dramatic figures in the paper, but as a whole, are we facing a huge challenge or is it being overplayed? Are we really facing just a relatively small challenge?
I will let the witnesses reflect on that. I will bring in Elaine Murray and then Professor Jagger.
I think that we were trying to be polite and listen to people rather than being shy.
I appreciate that.
Dr Carol Hill at the University of Glasgow, who is based in my constituency, has just completed a piece of work called “O4O: Older People for Older People”, which focuses particularly on the role of social enterprises in rural areas, where older people are designing services for other older people. That ties in to Professor Jeffery’s comment about releasing the talents and experiences of the over-65s, because social enterprises are an area in which everyone, young or old, can make a significant contribution. Are the witnesses aware of that work? Do they have examples of work from other parts of the country or the world on what we can learn from social enterprises?
With regard to the demographic profile, one thing that worries me is that if we say that people should keep working when they are older, they may take jobs that younger people could otherwise get. That would be fine if we had full employment, but in times of high unemployment, young people are finding it difficult to get into the labour market. I am a bit concerned about the pathway that we are currently on, as we may exclude the young from work by insisting that older people keep working for longer.
I was stimulated by what Gavin Brown said, and by Carol Jagger’s response. It shocked me, as the only female member of the committee, that the statistics on dementia show that rates of the illness seem to increase very significantly for females as a proportion of older people over 75 who have dementia. Is there any medical understanding of why that is and what action could be taken?
To answer the last question first, you do not need to worry. There is no real difference between men and women in the incidence of dementia; the prevalence of dementia is higher in women because they tend to live longer.
In response to Paul Wheelhouse’s question about healthiness, we should be thinking about disease prevention in the young old. There is definitely concern that they are less active and more obese than their older counterparts. Obesity is tricky because although it does not have a strong relationship with mortality, it does with disability. Obesity does not kill people, in a sense, but it makes them more disabled.
Another issue is the dependency ratio, which is not a great measure when we are considering the older population, and certainly care needs. There has been some research on other measures, one of which is an oldest support ratio between the number of people aged 50 to 74 and the 85-pluses. Those aged 50 to 74 are the generation that might care for older people informally.
From my calculations of the projections for Scotland, the ratio is currently around 14. In other words, there are 14 people aged 50 to 74 for every person aged 85-plus. By 2031, however, that figure will go down to seven, so there will be quite a change in the availability of younger old people.
In addition, if we are thinking about extending working life, and given women in that age group now have a greater presence in the workforce, we need to consider women who might be caring for an older parent in addition to caring for children and working. We would be asking those women to work a bit longer, which is an issue that we are not really addressing.
That is an important point.
I will pick up on a couple of the trends beneath the headlines and the global figures. One trend relates to Paul Wheelhouse’s point about housing. In addition to the ageing issue, our society is becoming more marked by solo living—that is, people living in single-person households. That reflects relationship breakdown and all sorts of social trends, and it means that more of us than ever before will, in all likelihood, arrive into older age living alone.
That has implications for the supply of housing stock and the need to get our act together on housing adaptations. There are also big implications around possible social isolation. We are learning that among the over-75s and over-80s there is a growing burden of mental ill-health such as depression, and we are only just beginning to understand some of the drivers behind that.
There is a big agenda around not just housing supply and quality but how well we are doing in communities in relation to social cohesion and connection. I understand why, in Scotland and elsewhere, we talk about the need to keep people at home for as long as possible, but I think that we actually need to keep people active and in the community for as long as possible, rather than running the risk of people being, in effect, housebound in their own homes. I think that we can look to other societies, not least the oldest society on the planet—Japan—for ways of using reciprocity and informal support, and not just formal care services, to help to address that challenge.
10:30
A second trend that has been touched on is dementia. We do not know any more than people more widely whether the projections are accurate, but the middle-range estimate is a doubling of the incidence of dementia within 20 or 30 years. It is important in Scotland that we do not see a diagnosis of dementia as the end of someone’s life chances or their quality of life. We should be talking about secondary prevention too: what does it mean to live well with dementia?
In international terms, we have an outstanding dementia policy and strategy in Scotland. We have a lot of work to do to deliver that locally in practice, but there is a lot that we can do when people have dementia, even when they are in residential care, in secondary prevention and living well. That goes back to my opening comment about quality of life being the driver.
Thinking about older people more generally and whether they will be in paid employment, we know that the obvious contributions that lots of older people make are as a grandparent providing childcare and as a volunteer in their communities. The more that we can have a vision and practical examples of supporting older people to contribute rather than being passive recipients of services that someone else has designed, the closer we will be to resolving the sustainability challenge.
Mark McDonald asked about migration and its implications. I draw attention to the short note that I produced for the committee, which is part of paper 1 of the committee’s papers. On page 6 of paper 1, there is a bar chart that shows the principal projection in the middle and a number of variations. If you compare the principal projection with low migration, which is third from the right, you will see the implications of lower migration over the coming period. The number of older people would be only slightly lower, but the significant effect would be below-the-line reductions in other groups, particularly among the economically active population. That is really all that I can say on that issue.
There are interesting questions about the implications of migration, but I repeat that the buoyancy in Scotland’s population has been sustained by inward migration over the past few years. That is certainly reflected in our projections.
Paul Wheelhouse and Dr McCormick asked about the implications for housing and households. There are two things to say about that. First, we produced an estimate of the number of households in Scotland in May last year, and we will produce another in May this year, which will give you some indication of how we think that the number of households is changing. It is continuing to increase in Scotland, but rather less quickly than elsewhere in the United Kingdom.
I also draw attention to the Scottish Government paper on a strategy for housing for older people, which was published just before Christmas and which I have a copy of in my notes. The paper goes into the implications for housing in some detail and discusses what might be done in order to have the right type of housing stock for the population that we expect to have over the coming years.
I suppose that another aspect of migration is that migrants get older, too.
Indeed.
I want to respond to Mr Mason’s challenge of a few minutes ago about the extent of the fiscal issue. There can be a tendency, especially at times of tight budgets, to begin again to present investment in policies for older people as a crippling constraint that prevents us from doing other things that we might want to do. However, I would like to regard it instead as a matter of choice. Public policy is about choosing between priorities, and there are good arguments for choosing that priority, one of which might be about the vision of the society that we wish to live in as being one that extends solidarity and active citizenship to all its members.
There are questions about universality that we have not yet touched on, but I know that the committee will look at them later in this series of evidence sessions. It would be right to say, however, that there is another form of diversity among older people, which is diversity of income. The committee may want to consider that.
The matter of choice can also be a matter of rational calculation. When I think of rational calculations I always think of Professor Bell, because he normally has figures to back them up. I am going to prompt him in two areas. First, we can get fixated on the headline costs of things such as free personal and nursing care without thinking of the money that we would have to expend if such care was not there. Jim McCormick pointed to that at the start. I have in my mind that David Bell probably has figures that he could relate to, or at least dig out for, the committee.
Another point, picking up again on something that Jim McCormick said, is the economic value of informal economic activity, in particular people caring for infirm partners and grandchildren, for example. The latter kind enables the children’s parents to engage in economic activity that they might otherwise not be able to do. Again, I suspect that Professor Bell probably has numbers that he can prepare for the committee that can point to the economic value and impact of investing in policies that support active citizenship among older people.
I note with interest, Professor Jeffrey, the statement on page 14 of your report “Older People, Public Policy and the Impact of Devolution in Scotland” that
“The emphasis, to put it another way, appears to be more on older people as passive recipients of services than as active contributors to society.”
It stated before that, on the same page, that a number of public sector organisations
“appear driven by the ‘strain’ that an ageing population is likely to put on services in their area, which needs to be mitigated by measures to relieve that pressure: improve home care, reduce hospital”
admissions and so on. That is an important issue to bring forward.
I will let Michael McMahon in, to be followed by Professor Bell, who will no doubt hit us with a blizzard of statistics—but possibly not.
When I indicated that I wanted to come in, I thought that I might be taking us on a tangent that we had not gone along before, but I think that Professor Jeffrey has taken us into the territory that I wanted to look at.
Prior to Christmas, I had a discussion with a clinician in my area who talked about the efficacy of mass screening of elderly people for certain age-related illnesses and conditions. That will obviously have an impact as the elderly population increases and people are older for longer. The clinician I spoke to talked about his specialism and why he feels that it is not sustainable or cost-effective to screen for the condition that he treats. However, many people have vested interests and have directed public policy to ensure that there is mass screening. I wonder whether we can continue to sustain that type of investment, because it does not actually treat people. He had statistics that show that, in his specialism, the number of people who are caught by screening is very small. The number of those who are not caught by screening but who present as acute patients is similar to the number who are caught by the screening, and the life expectancy of both groups is similar. The likelihood is that the person will die from something other than the illness for which they are screened. That takes us into the co-morbidity argument, which is that the person’s death results from factors other than the illness for which they are screened. We spend a lot of money screening people, but do not catch many people through it.
We have seen evidence from England recently about the efficacy of mammography and mass screening. It appears, from talking to clinicians, that although there are more and more areas in which we are doing mass screening, there is no evidence that it is cost effective or that it helps in treatment of people with the illnesses for which we are screening. I want to ask the academics and specialists whether we should continue to mass screen or whether it is more effective to prevent people becoming ill in the first place and to treat people who present with acute illnesses without having been screened.
I have a couple of quick points that pick up on what Dr McCormick, Professor Jagger and Professor Jeffery—who has put me right in it—have said.
This will slightly contradict what Jim McCormick was talking about. The narrowing gap between male and female life expectancy means that more older couples are living together and caring for one another. That reflects something that we have indirectly alluded to. Caring is very complex—it is not just one on one. We have been doing work that shows that some people have as many as five informal carers, and that some carers provide care to more than one person. Aside from the complexity of care, that suggests that we need to look carefully at policies that support carers, because carers are playing an extremely important role. There is much more first and third generation interaction of care now than there was in the past, which is quite difficult to pick up in existing statistics. Support for carers is important and must be part of general care policy.
I was asked about the free personal care policy. In the past five years the main reason for the general increase in the costs of care for older people in Scotland has not been the increased costs of free personal care. The general on-going increase, as local authorities have allocated more money to that area, has largely been driven by demography.
I want to try to link the points from Dr McCormick and Professor Jeffery on rurality and the ageing population. I am a great supporter of people being given access to concessionary travel. However, in your paper, Professor Jeffery, you refer to quite marked differences between the impact of concessionary travel in an urban context and its impact in a rural context. I live in an area where bus services are decreasing, rather than increasing, because of fuel costs. There is greater dependency on the alternatives that you cite. This ties in with Dr McCormick’s point about encouraging as many people as possible to engage in their communities, to keep active rather than to stay at home, and to have social contact not only with their peers but with their children and grandchildren. Should the committee consider further the differences between rural and urban Scotland in that respect?
The committee could consider the substantial evidence that the subsidy for paid-for, on-demand services is quickly cut when budgets are tight. For the lucky people in my part of Edinburgh, the functional equivalent of such services is having a bus going past every five minutes that they can get on and enjoy when they are 60. That possibility does not exist in rural areas and the paid-for, subsidised alternatives are attracting less subsidy because they are easy to cut.
10:45
Professor Robert Wright (University of Strathclyde)
I am just recovering from the flu, so I have not been as vocal as I probably would have been.
That is all right.
I will make three points—that is about all I can manage today. First, we have to be extremely careful about how we interpret population projections; they are not predictions and they are based on assumptions that some of us believe will not be borne out. One of those assumptions is that there will be a very high future level of fertility. According to the assumptions, Scotland is at the top end of the fertility table for rich countries. It is also assumed that we will have relatively high levels of net migration for ever, but we know that immigration is driven by policy and that the coalition Government in London wants to reduce net migration from hundreds of thousands of people to tens of thousands of people. That will obviously have a knock-on effect on immigration and therefore on net migration to Scotland, so we must be careful. As the graph in George MacKenzie’s submission showed, we can get quite a different picture depending on the assumptions that we make.
My second point is about the fact that the labour supply among older people will increase a lot, which Charlie Jeffery mentioned. It is clear that people want to work into their 60s and even their 70s, which is fine, so the labour supply will go up in the older age groups. However, is there demand? No. Is it possible to generate demand that will translate that supply into jobs? That is the real challenge. I do not think that there is an easy answer to that. Not everyone can work for the Government. It is a tough issue.
Related to that is the volunteer labour issue, on which a student of mine recently did a PhD. There is great potential for older people to make a solid contribution to the economy through volunteering. It is an extremely important issue and one on which the Government can have a sizeable impact. Basically, small incentives to convince people to volunteer more could generate big dividends. I am not talking about paying them, in which case they would not be volunteers, but people might be prepared to volunteer their time if they got their bus fare to go to the place where they work or if they got something small like a free lunch. There has not been too much discussion of that in Scotland.
Are we talking about an issue that is not a big challenge? Has its importance been blown out of proportion by the media and by people like me and David Bell? Is it a real crisis situation? I would not say that it is a crisis, but it is an extremely serious situation. If we look at the younger end of the older population—those between the ages of 65 and 75, say—there is great scope for the use of some sort of technology that will lead to lower costs.
The free care for the elderly policy is a great policy, because it is much cheaper to keep people in their home than it is to put them in a public place, such as an old people’s home. We always go on and on about how expensive the policy is, but we do not often consider the alternative and how expensive it would be if the policy were not in place. That is why many other countries have had what is called home help in place for a lot longer than we have had it in Scotland. It is a way of reducing the costs of an ageing population.
The age group that is the real problem—I think that it would be naive not to think of it as a problem—is the 85 and above group. Rightly or wrongly, people in that age group are often referred to as the frail elderly—I am sorry, but that is one of the phrases that is used. The life expectancy of people in that age group is about six years. Some estimates suggest that four years of that will be non-healthy life expectancy, which means that there will be a significant input from the state in terms of health or accommodation services. People who will be 85 20 years from now are 65 today, so we know the numbers. There is no real disagreement on the fact that we will see 150 per cent growth. I just cannot see how we are going to reduce the costs within that age group. That is the real challenge. Life expectancy in Scotland is rising, but the ratio of healthy life expectancy to non-healthy life expectancy is not changing much, so the increase in life expectancy is also increasing the potential costs. The real issue about how we accommodate the ageing population is in how we accommodate the upper end of the older population.
Professor Bell has opened up an opportunity for me to climb on to one of my favourite hobby-horses, so I will take the opportunity and talk about carers. That is a key issue. The reduction in the ratio from 14:1 to 7:1 is alarming because, obviously, not everybody will be a carer for an elderly relative.
Professor Jeffery mentioned the cost differential. That is stark in the case of people who care for a relative and are paid carer’s allowance, which is £55 to £60 per week. If we compare that with the cost of a residential care placement for the individual, which is probably thousands of pounds per week, we can see that there will be a substantial cost differential if fewer people are available to provide that care.
Are we giving enough support to carers? I speak from experience as my mother cared for my grandparents while they were alive. For some time, my view has been that carers are not given the level of support that they require and to which they are entitled. Carer’s allowance is set at between £55 and £60—I cannot remember the exact figure—but carers are also restricted in the amount of work that they can do and still qualify for that allowance, so their income is restricted in two ways. I do not think that we could realistically suggest—and carers themselves do not suggest—that they should be paid anything close to the bed rate for a social care placement, but we need to look at the issue.
Given what is happening to some other benefits, it is perhaps a benefit that carer’s allowance is not included in the current review of the benefits system, but it has become a Cinderella benefit because it does not get looked at; there is no real consideration of whether a significant uplift in carer’s allowance is required. What support should carers get? Should the UK Government take a serious look at carer’s allowance and consider whether it is enough to allow people to care properly for elderly relatives without their facing significant financial pressures?
Professor Wright mentioned the 85 and over group, and I agree with what he said, but we should not be lulled into accepting the idea that everyone is frail at 85. In our Newcastle study, 20 per cent of them were perfectly independent in a range of activities of daily living. There is still huge variability in people in that age group, and we need to find out how we can keep more of them independent. They are a challenge, with their multiple morbidities, but we should not believe that they all need a large amount of care.
To return to the points that have been made about caring, perhaps we need to think about more training in how to care for people with dementia, including more training for health service staff including nursing staff and doctors. They are seeing more people being admitted to hospital with dementia, but they might not be knowledgeable about how to care for them.
I will let Mark McDonald back in in a moment, but that is an important point. There is a real issue about the status—for want of a better word—of people who care for older people. That is reflected in the often poor salaries that they receive for the work that they do.
That is a very important point, convener. My mother cared for my grandmother who had dementia; she was lucky in that she had experience of working with dementia patients, but a lot of people do not. Alzheimer Scotland has raised concerns that health professionals do not always have the necessary training to care for people with dementia or, crucially, to spot the early signs of dementia to enable early diagnosis, which must also be factored into our considerations.
In talking about carer’s allowance, I should have added that while we are reaching the stage at which people of pensionable age are looking after people of pensionable age, those people do not qualify for any additional support because carer’s allowance is not available to people who are already claiming the state pension. That is another issue to consider, and it will become much more prevalent as more people who are over the pension age are caring for a spouse who is also over the pension age.
It is not all gloom and doom: people are living longer because they are healthier than ever before. I meet all the time in my surgeries—as I am sure all the committee members do—a lot of really feisty old people who are aged 80-plus and have a real lust for life.
Many older people who retire often wish that they had not done so, or that they had had the opportunity not to, which is a major issue. We cannot have firefighters, police officers, teachers or people in many other professions working in their 70s, but there will be an issue with supply, and one would hope that demand would increase for people in the employment sphere.
We have about 30 or 35 minutes to go before we end the meeting, and I still want to touch on a number of issues. I will let Gavin Brown in next. People may wish to think about issues in terms of universality of services for older people, such as transport and the impact of fuel poverty.
Professor Jeffery’s paper was a very interesting read. You ultimately present a mixed picture in Scotland, but on page 37 you state:
“policy action has lagged ... behind policy rhetoric.”
Can you expand on that, and identify specific areas that ought to be flagged up to the committee in which you feel that policy action has genuinely lagged behind?
That has put me on the spot.
I did not intend to do that. I will leave you to think about that for a couple of minutes, and I will let Professor Wright in.
The issue of carers is key, and there is a great deal of variability among countries in how they subsidise that activity. My country, Canada, has 10 provinces, so there are 10 different subsidy portfolios. It would not take much effort to look at what others are doing and see whether you could learn from them.
However, the issue is a bit more complicated, because the scope is more limited than some people might believe. The people who now make up a large chunk of the older population are the parents of the baby-boom generation. As the population ages, the baby-boom generation—the big group of people that we are talking about—will start to retire.
The problem with the baby-boom generation, of which I am one, is that our fertility rate was extremely low compared to that of our parents, so the supply of potential carers—because much of the care is provided by the children—will go down. We have an ageing population, and one of the consequences is that there is a decrease in the number of potential carers, but that is not obvious to people. That is why policies such as free care for the elderly or the provision of some sort of subsidised home help that keeps people in their homes are critical for the future. We see discussions in the newspapers from time to time that such care is too expensive. It may be expensive, but it is not “too” expensive, because the alternative is probably much more expensive.
This caring business is important, but the scope is a bit more limited than some people would like to believe with regard to how we accommodate an ageing population.
Indeed—because many people do not have children to care for them.
11:00
I have a couple of brief points, one of which is about the importance of decisions made at Westminster for our choices in Scotland. In particular, it is possible that the coalition Government will respond this year to the Dilnot review on paying for long-term care. For example, different choices in England about what to do with attendance allowance, which has a massive impact on the care equation in Scotland, could alter the picture and the consequences in Scotland could be quite profound. Engagement between Holyrood and the UK Government on the response to Dilnot is critical for the financing of care, broadly put, and the attendance allowance is the emblematic part of that.
Secondly, JRF’s single biggest project at the moment is called a better life. It looks at older people from all across the UK who are in their 80s and 90s and, indeed, at a cohort of centenarians, and at their needs, how those change, and what their preferences are for having their needs met. Their preferences are often different from what we might expect when we look at the younger old. Our evidence about people with a high level of support needs is improving, whether they are living in residential care or a community.
Thirdly, and finally, a small but significant opportunity for Scotland will be the establishment of the new life changes trust, endowed by the Big Lottery Fund this year. It will invest £2.5 million a year for the next 10 years in Scotland for people who have dementia and those who care for them, specifically at the early post-diagnosis period. It will look at what can be done in the first year or two following a diagnosis of dementia to keep people in the community, to keep them well, to support their carers, and to improve their quality of life. The budget is small, but could be critical in improving our knowledge and practice in Scotland around some of those high-cost interventions and making them more sustainable in the long term.
Thank you. I do not think that we should underestimate the impact of Westminster. On page 11 of his report, Professor Jeffery says:
“the key policy levers that impact on the income of older people – on pensions, benefits and taxation – and those which shape their terms of access to the labour market, are held at UK level. There are, as a result, obvious limits on the capacity of a Scottish government to develop an integrated policy approach.”
I will say something brief about caring and the role of the voluntary sector and how its economic impact might be assessed.
An organisation called Food Train, which started in my constituency, delivers food to older people and also provides a handyman service and a befriending service. It has been very well supported by the Scottish Government and by the previous Scottish Executives; it has been going for a number of years. The volunteers are predominantly the young elderly or the recently retired who provide a service for older people.
It would be interesting to do an economic impact assessment of the benefit that has been achieved in terms of the service that has been provided to people by volunteers going into their homes. At certain times of the year, such as Christmas, the only person that an old person might see in their rural home might be the volunteer from the Food Train who brings them their food. We need to see the value of such projects and of government supporting the voluntary sector to provide that type of service.
The self-directed support bill will come to the Parliament this year—I am picking up on what Jim McCormick said and thinking about older people having a say in the services that they receive, rather than just being the recipients of care, usually from the local authority. That is the first example since the Scottish Parliament was re-established of a bill that extends the rights of the consumer fairly substantially. It will provide older people with much more of a say about what services they want, which might not coincide with the services that local authorities are used to providing.
Even though the attendance allowance might not be interfered with for political reasons, I suspect that as a result of the Dilnot review there might be a change in the capital limit, which is in effect the amount of money that someone can hold personally. At the moment it is £23,000—in fact, it is less than that. Unlike the health service, which is universally free at the point of delivery, if a person requires social care they are expected to contribute until they have X amount left in their piggy bank. X will be increased considerably—I think to £100,000—if the Government accepts the Dilnot report. That will have an effect on charging for care.
I stand to be corrected, but I think that, in effect, under the National Insurance Act 1946, which describes relationships between the UK central Government and local authorities, local authorities are—or have been—able to charge pretty much what they like for care for older people. There is therefore wide variation throughout the country—that is also true in England—in what local authorities charge for services that are not free and can be charged for. It may be seen as unfair that someone in Argyll and Bute pays twice what someone pays in another local authority. That touches on Charlie Jeffery’s point about the differences in income among older people. There are the poor old and the relatively rich old. Some relatively poor pensioners in a high-cost area might find that their budgets are deeply cut into by the cost of social care.
You mentioned self-directed support. There seems to be quite a lot of confusion, because self-directed support is a different way of allocating resources but, at the same time, the amount of resource is also changing. Like a lot of people, I am confused about that.
My understanding is that local authorities will still set the size of the budget for the individual who receives care, but it can be allocated in the way that the person who is receiving the care wants. If they want a trip to Largs, which is not usually part of a standard social work package, they can allocate the budget to that, but total expenditure will not increase. Local authorities will still allocate the budget.
I will respond in three ways to the challenge that Gavin Brown laid down. The biggest mismatch between policy action and the very positive aspirations of “All Our Futures”—the ageing and older people strategy—is in integrating or maintaining the integration of older people in the labour market, because that is precisely where the Scottish Parliament does not have levers to deploy.
Another issue is intergovernmental relations between the Scottish Government and local authorities. In large part, delivery happens at the local level. Different local authorities respond to budget pressures in different ways. There is perhaps a tendency in some local authorities, which is apparent in their single outcome agreements, to treat the elderly population as a problem rather than as a set of active citizens to be nurtured. Within constrained budgets, big-ticket or high-priority issues, such as free personal and nursing care, can cause spillover and reduce spending in other areas that may be valuable for older people.
The final issue brings us back to rural areas. We have heard that rural areas tend to have older populations. Some policies that have been introduced bring less benefit to people in rural areas. We have heard about public transport, but another issue is fuel poverty. In rural areas, fuel supplies are often inefficient and more expensive, and housing is often more difficult to insulate to contemporary standards. Because of that confluence of factors, there can be a mismatch between rhetoric and reality for rural areas.
We have not touched on universality versus a targeted approach. Does anyone wish to comment on that?
We discussed universality during our session in Largs with the cabinet secretary. A number of witnesses in the earlier inquiry on preventative spending argued that continuing with universality is becoming less justifiable. One argument that I put to the cabinet secretary, with which I am sure he agreed, is that removing universality can lead to a situation in which people do not come forward for services that they need because of the stigma of having to go through means testing. Does anyone have a view on that? If we removed universal benefits, we might face a situation in which those who need services would not come forward for them.
I do not know the precise answer to that, but I can say that we should not treat policies as icons that cannot be challenged because they have established something distinctive in Scotland. We run a bit of a risk of doing that in some areas. Some of my colleagues in the university who are well-paid professors use their bus passes regularly as they have a bus going by every five minutes, but they have absolutely no need of that support from the state. That is an extreme example of the problems of not targeting, but the point can be translated into other fields in equivalent ways, although perhaps not so crassly.
Can I come back on that point, convener?
I am sure that Professor Bell is far too young to benefit from such a bus pass, but I will let him answer before I let Paul Wheelhouse respond. I emphasise that there are no icons in the Finance Committee—other than the convener, obviously.
The issue of non-take-up of benefits has been researched quite a bit. It definitely seems that older people are least likely to take up services that are offered to them. That might be what we call a cohort response. Professor Wright mentioned the baby boomers. Perhaps as that group of people age, they will be more willing to ensure that they get all the benefits to which they are entitled, but that remains to be seen.
The research on attendance allowance, which is a specific benefit that has a much lower than expected take-up rate, shows that, although the take-up rate is low, the effect is concentrated among those who would not benefit very much from it. The headline rate is that perhaps 20 per cent do not take up the benefit, but they are the 20 per cent who would not benefit hugely from it.
We have touched on rural and demand-responsive transport. Professor Jeffery, do you have any firm view on where we should go with the concessionary travel schemes? Do you recommend any changes—perhaps in the ages that are covered or relating to the geographic differences in Scotland—to address the issues that you raise in your report?
You are pushing into an area of great difficulty, which is about the extent to which local authorities should be required to deliver a specific set of services with financial implications. We now have the concordat system, which has moved away from that kind of ring fencing. One answer to the question is that it would be difficult in the current circumstances to do so. However, a number of aspects of current policy require differentiated consideration. One of the differentiations concerns rurality and its challenges. I suspect that more could be done on that.
11:15
The rural populations are much older than the urban populations of Scotland. They are ageing more rapidly than the urban populations. That is all a given.
It is also much more expensive to provide the services about which we are talking in rural areas than in urban areas. It is hard not to foresee that, in future, people will have to move to urban areas if they want those services because there are big economies of scale in providing them there. That is what happens in other countries, and it will be the case here, especially if there are big increases in costs and hard decisions need to be made.
The debate on universality and means testing has to do with what standard of living we want our older population to have. Giving bus passes to highly paid university professors who are 60 years old seems a bit ridiculous. People who have the potential to make a big contribution to their care when they are old should be expected to do so. I always find it strange that it is possible for someone to hand their house on to their children rather than wind down their wealth by selling the house to look after themselves when they are old. They thereby perpetuate inequality, which we all despise anyway.
At the end of the day, there will have to be more means testing. However, the problem with means testing is that bureaucracy is needed to do it and there is a big cost to that. If a programme is universal, it is at least relatively cheap to administer. Starting to means test a programme makes it more expensive, so that must be weighed up against the options.
Other countries do not treat every person the same regardless of income or personal or family financial situations, particularly when it comes to services for the older end of the population.
I have a question on that point and pension credit. As I understand it, something like a third of the pension credit to which people are entitled is not being claimed because of the complexity and stigma of claiming. I do not know whether anyone can correct me on that figure. That is perhaps an example of the advantage of moving from means testing to universality.
It is certainly one of the credits with the lowest take-up among potential claimants. As Robert Wright said, the bureaucracy that is associated with calculating credits correctly is absolutely massive.
In the UK and some other parts of the world—less so in Europe—we are used to approaching the targeting of support by means testing—in other words, poverty testing. That is, people must prove their poverty, which many find stigmatising, to be entitled to a certain kind of support.
There are, however, other ways to go about means testing. For example, one can do affluence testing using the tax system, which comes at the matter from a different angle. In Australia, there is a tradition of using affluence testing through the tax system to target child benefit at low and middle-income families without the problems of stigma and low take-up.
Mr Mason is quite right about the persistent low take-up of pension credit. Great Britain is bumping along with about two thirds take-up from those who are entitled to pension credit. Scotland is the same, but the take-up in Northern Ireland is more than 80 per cent. So, even within the same system—a means-tested system that is ostensibly the same throughout the UK—there are big variations in take-up. The Northern Ireland example is interesting because it shows how you can make that kind of system work a bit more efficiently if you want to go down that road. In the long term, pension credit is not the answer, but there are different ways of managing the regime to deliver ostensibly the same system.
The evidence on rurality from Finland is interesting. Finland is a country with a large, sparsely populated rural hinterland, and it has been working to reduce dementia costs. Where it has invested in intensive home visiting to support the families and carers of people with dementia, it is delaying admissions to higher-cost residential care by between two and three years. Ultimately, the outcomes may be the same and people may end up needing full-time residential care, but if the cost can be deferred by two or three years a lot of money can be saved. More important, that adds quality of life and support for the families that families in rural Scotland do not get. We do not have to look far to find interesting examples of how we can do things better and more cheaply to get better outcomes, which I think we should be interested in.
In the first session of the Parliament, when we took evidence on the Housing (Scotland) Bill, David Comley, who is the head of housing in Glasgow City Council, made it clear that, if means testing were introduced for housing repair grants, it would cost the council more money to introduce and run the system than would be saved. At the time, the council had a simple system whereby someone in a private house in council tax band F or above did not qualify for a grant. That might have been a wee bit crude, but it did not reduce the amount of money that was available through administration costs. There are various ways in which such things can be addressed.
I have a couple of comments to make about rural transport. Many of the routes in rural areas are not economically viable and have to be subsidised by the passenger transport authorities. The bus companies are demanding ever greater subsidies, which puts more pressure on the transport authorities to provide funding. At the same time, our successful community transport initiatives are also reliant on grants from local authorities that are under financial pressure and their level of subsidy is declining. Might the Government assist community transport initiatives by allowing the use of bus passes on community transport? That would be a way for it to subsidise such transport more directly.
That is an interesting suggestion.
No one else has indicated that they want to make any further comments, but we still have six or seven minutes left. If anyone wants to make any final points, I will be happy to take them as long as they are brief. Professor Wright and Mark McDonald have indicated that they want to do so.
I am not sure whether Professor Wright can answer this question or whether we may have to direct it to Professor Bell to have a look at. Do we know the net cost after taking off the savings in administration resulting from abandoning means testing for some universal benefits? Is it possible to see a net cost? We often talk about the gross cost of things such as concessionary travel but not necessarily with an understanding of what we have saved through no longer having to means test. The convener has given a helpful example of the cost being so significant in Glasgow that the council decided not to proceed in the traditional way.
I also want to touch on travel. There seems to be a presumption that wealthier people use the buses a lot. There are two things to say about that. Professor Jeffery has presented evidence that individuals in that income group do not use the buses as frequently, although there has been a substantial increase in take-up, with more people accessing the bus pass but not necessarily using it often. I do not think that we should leave the meeting thinking that people in higher income groups use the buses as often as people in lower income groups. The positive aspect of that, from the perspective of the environmental impact, is that it saves CO2 emissions, as we are getting people out of cars and on to buses.
I was going to make that point.
The answer to your question is no and no. We do not know that, but it is something that one could calculate. Such calculation would be specific to a particular programme, a particular benefit or a particular time period. The methodology is certainly there to do it, but I do not have numbers that I can pull out of my head, and I do not think that David Bell does, either.
Professor Bell is getting his abacus out as we speak.
It is a key question. Some work was done in Cambridge that said that about 10 per cent of people do not take up benefits to which they are entitled. We know that there was a big push by the Government for people to get the benefits that they were entitled to on the ground that they were paying for them. The Government needs to promote that message because of the complicated nature of the system or because of stigma or whatever. Even though people are entitled to those benefits, 10 per cent still do not take them up. If anything, we might expect that figure to be even higher among the elderly population, but we do not know.
It looks as if Mark McDonald will have the last word.
In that case, I will try to make it worth while.
I apologise—Professor Wright would like to say something else.
One of the things that I find very strange as someone who comes from Canada and who has lived in Scotland for 20 years is that there is not a lot of data in Scotland that is targeted at the older population. Scotland is in the strange situation whereby there are two birth cohort studies, which involve looking at people who are freshly born and following them through time, but there is no longitudinal study of the aged such as they have in England, Ireland, Northern Ireland, the United States and many other countries. If such a survey were carried out, a lot of the questions that we have discussed today could be answered, because questions such as, “If this was means tested, would you apply?” could be included in the survey and information would be got back.
I do not know why that is the case, because there is active discussion in the Parliament, the media and the academic community of the fact that the population is ageing and the socioeconomic consequences of that. It seems rather strange that we do not have available to us such a fundamental tool that would answer a lot of the questions. Even Northern Ireland, which has a fraction of Scotland’s population and a population that is not ageing anywhere near as rapidly as ours, has one. Ireland is the same. I do not know whether the committee has any input into that. We really need such information. If we had it, it would inform and enlighten the debate a great deal.
Professor Bell has highlighted the need for robust data across the piece before. As part of our budget scrutiny, we emphasised in our report to the Scottish Government that data across the board had to be much more robust. We expect some progress on that. It is not just in this area but across the spectrum that there is a need to have better and more reliable data that everyone can refer to.
To pick up on that point, I am here in listening mode as well as speaking mode. As registrar general, I am very keen that more use is made of the statistics that we produce. I also want to ensure that what we produce is fit for purpose and meets the needs of policy makers. Therefore, I am open to such proposals and suggestions.
There is a longitudinal survey, although there is not one of the aged, as Professor Wright said. That is certainly something that can be looked at.
I will make two points, which might take us slightly beyond 11.30; I apologise profusely for that, but I will do my best.
On bus routes, it struck me that there are a number of bus routes, particularly in rural areas, which I suspect are being kept going by use of the bus pass. If we were to remove universality, that could potentially reduce take-up and affect the viability of those routes, which would have a knock-on effect for the people who use them and the communities that rely on them.
I realise that we did not get on to a discussion of fuel poverty, but when we were talking about housing issues it went through my head that I suspect that we have a problem—it is probably a niche rather than a widespread problem—with underoccupancy of housing, particularly council housing, when people have raised their family in a three or four-bedroom house, have kept the house and are there on their own or with their partner. Essentially, the house is too big for them to be able to afford to heat it properly. In addition, as they get older, there is an increased likelihood of their having an accident in the house as they have to go upstairs and downstairs to access the bedroom, the bathroom and so on. Local authorities need to look at how they address that issue, because it will have an impact and be a concern in the future.
As someone who was a councillor in Glasgow back in the 1990s, I know that Glasgow City Council tended to offer people incentives to move. For example, if someone lived in an area of relatively low demand, they would be offered accommodation in a much more high demand area if they were willing to surrender their large house.
That is being done in Aberdeen at the moment, and I think that other authorities are looking at it.
We are 30 seconds over time. I thank all the witnesses and committee members for their input, which is very much appreciated and gives us a lot to reflect on.
I suspend the meeting for a few minutes to allow the witnesses to leave and to give the committee a break. We will reconvene at 11.40.
11:30
Meeting suspended.
11:39
On resuming—