Families across the UK risk losing their inheritance to care cost fees as councils are laying claim to around £343million of debt.
The total debt accrued by care costs soaring by more than 40 per cent since 2020, as care home costs reach an average of £64,000 per year.
Some families are being forced to put their houses up as collateral and sacrifice inheritances to cover mounting care expenses.
Councils across England have laid claim to £343m in care home fees through deferred payment agreements.
NHS data reveals that local authorities are set to reclaim these substantial sums from care home residents’ property sales after they die.
A recent survey found that 74 per cent of UK families struggled to fund care for elderly relatives in 2024, highlighting the growing financial burden on households.
Essex County Council currently holds the largest debt of any local authority at almost £16m, followed by Lancashire County Council at nearly £14m.
The surge in council claims follows Labour’s scrapping of a Conservative-planned cap on care costs, which had promised to ensure nobody would need to sell their house for care.
Across England, 6,815 Deferred Payment Agreements (DPAs) are currently outstanding
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Across England, 6,815 Deferred Payment Agreements (DPAs) are currently outstanding, allowing homeowners to use their properties as security to borrow from councils for care costs.
Last year saw 3,205 families enter into new DPAs, marking a 35 per cent increase from the previous year.
In 2023-24, councils recovered £90m from 2,295 families, with an average debt of almost £40,000 per case.
Some local authorities also charge interest on these agreements, with rates currently capped at 4.25 per cent as of January 2025.
Weekly care home fees have reached staggering levels, with nursing care for dementia patients costing up to £1,510 for permanent stays.
Data from Lottie shows even basic residential care now costs £1,156 per week for permanent residents.
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Residential care with dementia support comes in at £1,318 weekly for permanent stays, while nursing care without dementia costs £1,457. Respite care rates are even higher, with nursing and dementia care reaching £1,640 per week.
Basic residential respite care costs £1,337 weekly, while residential care with dementia support is £1,413. Nursing care for short-term stays is priced at £1,573 per week.
Mike Padgham, of care provider Saint Cecilias Care Group, warns that councils are increasingly pushing families towards DPAs.
He said: “Councils are cash-strapped and doing everything they can to avoid paying for care. So they are trying to encourage people to go to them and use a deferred payment agreement rather than go to a private provider.”
These agreements are leading to more disputes between councils and families, with Padgham predicting conflicts will “only increase” as more families face care costs.
He added: “We’re still in the situation where people are selling their homes to pay for catastrophic care costs.”
In England, anyone with capital exceeding £23,250 is ineligible for state funding, making DPAs with local councils one option for covering care fees.
Jane Townson, of the Homecare Association, said: “DPAs can provide vital financial flexibility for those entering residential care.
“Families frequently report delays, inconsistent eligibility criteria, and a lack of transparency about costs and repayment terms. These challenges can create unnecessary stress for people at a difficult time in their lives.”
The Government has launched an independent commission to reform adult care, though a final report isn’t expected until 2028.
Campaigners have criticised successive Governments for failing to adequately fund the sector.
A spokesman for the Local Government Association defended DPAs as a valuable tool for managing care costs.
The spokesman said DPAs helped families manage costs without needing to sell their homes immediately, with councils committed to “offering this option sensitively and in discussion with individuals and their families.”
They added: “While councils are keen to support people, they also have a responsibility to ensure public funds are managed effectively and that costs can be recouped and DPAs are a valuable tool in balancing these needs.”
Some care providers have warned they risk collapse due to the Government’s National Insurance raid increasing staff costs.
