Our grey future

Which sector of the population will be in most pressing need of housing in the next three decades? The public, taking its cue from the government and media, would probably say key workers. But demographics tell a different story: by 2031, our ageing population will make young teachers, nurses and police officers a prized commodity and their parents will be squeezed by a pensions crisis and housing shortage.

Government statistics chart the demographic timebomb. In 2001, 8.2% of the UK population was aged over 65, equivalent to 9.1 million people. By 2031, that figure is set to rise to 25% or 14.8 million. Thanks to medical advances that lengthen post-retirement lifespans, the over-85s will be the fastest growing subsector (see graph).

Just as today, the majority of older people will live in their own homes. But even if the percentage of people in residential care remains the same – roughly 5% of over-65s and 25% or over-85s are in residential care or sheltered housing – a provision gap is likely to open. Figures from healthcare researcher Laing & Buisson state that, in April 2002, there were 511,300 beds in long-term care, (including provision for the physically disabled) in England and Wales. In 2001, the Office of the Deputy Prime Minister counted 476,000 sheltered units in the UK and 23,200 "extra care" or very sheltered units. Based on these figures – and in the absence of any detailed research – there are roughly 1 million bed spaces and 9.1 million over-65s. As people live longer, 1 million beds will seem like a drop in the ocean.

Councils and registered social landlords are already finding that the average age of tenants in general-needs and purpose-built accommodation is rising, and that older, frailer tenants have a higher demand for support services. "You can't ignore these contextual changes, and we're changing our services to suit," says Chris Greathead, managing director of Places for People Group' supported housing arm, New Leaf, which is using sheltered housing staff on outreach programmes in general properties.

From a local authority perspective, the trend is increasingly for RSLs or the private sector to run their elderly care. Anecdotal evidence suggests that many councils are finding that the bedsits previously used to house older tenants are inadequate for their longer-term needs and are hard to let.

At New Progress Housing Association in Lancashire, where one-third of general-need tenants are over 60, the ageing population also raises questions about its role in the community. "The dilemma is, will we be able to get back to a more balanced population over time or should we recognise that the balance is shifting?" asks managing director Bernie Keenan.

Alongside the problem with public perception, there is a policy and funding mismatch. RSLs proposing developments and services for the elderly report shortfalls in Housing Corporation capital funding and the new Supporting People regime. In some cases, local authorities are accused of paying lip service to older people strategies while diverting funds to other issues. And despite growing awareness that the provision of housing for elderly tenants is inextricably linked to the provision of healthcare, the connections between the relevant government departments could be stronger.

You can’t ignore these contextual changes, and we’re changing our services to suit

Chris Greathead, places for people

Housing associations planning ahead have to take into account some crucial differences between the elderly population of today and the future. In the next few decades, a greater proportion of older householders will be owner-occupiers: today, 65% of pensioners are owner-occupiers but this figure rises to 80% for householders in their 50s and 60s. Three out of 10 of today's 70-year-olds are social renters, compared to 21% in their 60s and 15% in their 40s and 50s.

"A generation of sheltered housing tenants were council tenants, passive recipients of services. But people will want better facilities, with a spare room for family or visitors. We need to ask if we're developing homes we would like to live in in 30-40 years," says Sarah Vallelly, research manager for Housing 21. "We need to develop more mixed-tenure developments or retirement villages."

Then, there is the ageing black and minority-ethnic population, often marginalised from mainstream provision by differences of language, culture and the perceived stigma that their families can no longer house them. "Bingo nights and fish and chips systematically excludes some sections of the population," says Vallelly.

Other groups may need specialised approaches. Hanover Housing Association points to the ageing group of right-to-buy leaseholders, who may no longer be able to afford the repair costs of their properties, but have lost the right to be nominated into public sector sheltered housing. And in low-demand areas elderly owner-occupiers with low equity in their properties may need innovative housing solutions.

Another key difference is in the type of specialist accommodation local authorities want to build. In recent years, councils' bills for residential care have been inflated by rising staff costs and a steady decline in bed spaces. At the same time, advances in technology mean frail elderly people can live independently for longer. As a result, most local authorities are looking towards "extra care" or very sheltered schemes, where tenants have their own front door and are supported by 24-hour on-site care teams.

But Housing Corporation funds do not always stretch to meet the relatively high building costs. South Yorkshire Housing Association is working on a £3m, 36-flat extra care scheme with Sheffield council, the first of eight that Sheffield hopes to deliver. But, as South Yorkshire chief executive Tony Stacey explains. "The programme is already lagging because the corporation has consistently asked us to reduce costs. We're now reliant on funding from the £87m DoH scheme or the regional housing board pot."

Sheltered housing tenants will want better facilities, with a spare room for visitors. We need to ask if we’re developing homes we would like to live in in 30-40 years

He is referring to an £87m programme from the Department of Health and Housing Corporation, which the DoH estimates will fund 1500 extra care units in 2003-06. RSLs welcome the move, but are not convinced by the sums. The suggested average capital grant is £58,000 per unit, but Housing 21 calculates that costs including land are about £80,000-85,000 a unit. Also, the fund cannot even get close to delivering the 5000-6000 extra units announced by former health secretary Alan Milburn last summer.

Hanover's Northern region does have capital funding for a pipeline of 10 extra care schemes, but is finding that revenue funding is a pressure point. "Supporting People is complicating the whole issue of delivering extra care," says Vera Brearey, Northern operations director at the association. "With the current chaos, most local authorities are not able to commit to what they will be able to afford in a few years. The social services and housing teams may be pushing for an extra care scheme, but the Supporting People team might say there's no money to support it."

As for supporting elderly people in their own homes, Supporting People provision seems to be patchy.

South Yorkshire HA, for instance, has a floating support contract for Sheffield council, offering over-65s in council or South Yorkshire housing help with practical tasks, companionship and access to other support services. But when Hyde HA submitted a bid for a cross-tenure floating support service for older people to a London borough, it was told the idea didn't have "high enough priority". The same borough gave the green light to floating support for young homeless people.

These funding anomalies suggest that local and central government have not woken up to the implications of the ageing population. "We find that many authorities do not have a coherent strategy for older people and, where there's planning gain, there's an assumption it will go towards general-needs provision," agrees Housing 21's Vallelly. "We would like to see better joint working between the DoH, ODPM and Housing Corporation, including more prominence for older people in regeneration strategies."

Vallelly points to a gaping hole in joined-up government over intermediate care: short-term accommodation for elderly people leaving hospital who need to recuperate before returning home. RSLs are keen to offer the service in sheltered schemes, whereas the DoH wants to eliminate "bed-blockers". But until the government changes the law, any RSL managing a "health" service is acting beyond its legal powers.

Clare Crawford, Hanover's senior development manager for the South-west, says: "It costs £150 a day for a hospital bed, whereas sheltered accommodation inclusive of care is just £30 a day. The saving to the government is phenomenal, not to mention the benefit to the individual."