Tomorrow's elderly population may not end up deprived and penniless after all, as Prime Minister Gordon Brown today pledged a radical overhaul of the social care system in England. Mr Brown says that, without a major shake up, the care system in England alone faces a £6bn shortfall within 20 years. There will now be a six-month public consultation, focused on making care services fairer and more affordable.

This will incorporate the prospect of harnessing the equity stored in people's homes to pay for their own care via a cheaper government-backed equity release scheme, that is currently only available on a commercial basis.

Nick Kirwan, Head of Health and Protection Insurance at the Association of British Insurers, said: "This is a very positive development.  We now need our political leaders to show the courage to see this through to a conclusion so that we reach a clear settlement of the responsibilities of the State, individuals and their families. The insurance sector is ready to play a full part in developing safe, simple and affordable products to help people plan for the part of the cost of providing care that will be their responsibility."

In Scotland, personal and nursing care is free, while Northern Ireland and Wales still have the widely-criticised means-tested system that is used in England.

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