Quality care accommodation crisis looms for elderly

Kenneth MacKenzie, managing partner of Target, said: “Clearly, the elderly care home sector needs to invest in good-quality, purpose-built facilities to ensure it can meet the expected demand in the coming years.”

The prediction follows the publication Focus on Older People: Population Ageing in the UK and Europe, the latest study by the Office of National Statistics, which showed the fastest-growing population age group was aged 85 and over.

According to Mr MacKenzie, the ONS study is a stark reminder that the fastest population increase in the UK is set to occur within what ONS term the ‘oldest old’ or those aged 85 and over.

Mr MacKenzie said it was hard to ignore the ONS figures, which suggested that between 1985 and 2010 the percentage of the population aged 85 and over increased from 1 per cent to 2 per cent, with the number aged 85 or over doubling from 0.7m to more than 1.4m.

By 2035, it is thought this figure will reach 3.5m and will represent 5 per cent of the total population.

The ONS data revealed that a male aged 65 can expect to live another 17.6 years, although only 9.9 of those years will be healthy, and only 10.2 years will be disability free.

A female reaching 65 can expect to live another 20.2 years, of which 11.5 years will be healthy and 11.2 years will be disability free.

Mr MacKenzie said Kames Capital and Target Advisers, the team behind the Kames Target Healthcare Fund, believes such a demographic change will put increasing pressure on the existing elderly care sector facilities, leading to greater demand and a severe shortage of suitable accommodation in the mid to longer term.

Gillian Bowman, manager of Kames Target Healthcare Fund, said: “The latest ONS report starkly outlines the ageing demographic of the UK.

“While we all hope to live healthier and longer lives, clearly the reality is not the case for many of us as the healthy life and disability-free life expectancy figures suggest. As such many of us will at some stage require elderly care facilities.

“Sadly, unless there is a significant investment in good-quality, newly-built facilities, we are likely to face a shortfall in good-quality care provision.’

Malcolm Steel, director of Edinburgh-based Mearns and Co, said: “This highlights the need to plan for tomorrow whatever your age, especially with inflation in mind.”

 

Sourced from FT Adviser, 15th March 2012.