How much does dementia cost the economy?

"Already the total cost of [dementia] is around £19 billion — that is higher than the costs of cancer, heart disease or strokes."

David Cameron, Alzheimer's Society, 26 March 2012

"£23 billion is a sort of estimate of the cost to the economy as a whole."

Paul Burstow, Today programme, 26 March 2012 

Today David Cameron launched his 'Dementia Challenge', pledging to double spending on research to £66m by 2015. He told the Alzheimer's Society that the degenerative disease is a national crisis, already costing the country nearly £20bn. 

But this morning, in building up to the speech, his Health Minister told the Today programme that the cost is four billion pounds higher.

Which figure is on the money?

Analysis

The Health Minister's information came from Dementia 2010, a report undertaken by the University of Oxford and commissioned by the Alzheimer's Research Trust. 

This report, complete with foreword from Mr Burstow himself, did indeed place the cost of dementia above the three other conditions mentioned by the PM.

However it should be noted that this doesn't mean that the Government is stumping up £23 billion to cover the cost of dementia. The bulk of this estimate (55 per cent) is accounted for by estimating the value of work done by unpaid carers.

As we have seen in the past, it can be difficult to calculate these costs precisely, but the Oxford University study arrived at its figure by applying gender-specific average hourly wages to each hour of informal care given by people in employment, and the minimum wage for those not in employment.

Of the professional care costs given in the report, social care accounted for £9 billion of the total, and the provision of health services £1.2 billion.

Number 10 has actually sourced Mr Cameron's claim to the Alzheimer's Society's itself, taking his cost from a 2007 study. At the time dementia cost the UK £17bn, but the PM's website claims that in the intervening five years the cost is estimated to have risen to £23 billion figure used by Mr Burstow.

So where does the £19 billion figure come from?

The discrepancy seems to be based on devolution with Mr Cameron apparently quoting the estimated cost for England alone. While this might make sense in the context of devolved health services, these actually account for a relatively small part of the total outlay.

Conclusion

The two politicians were quoting different figures based on the same two reports, with the Prime Minister emphasising the situation in England and Mr Burstow taking a UK-wide view.

The costs themselves seem to be well-sourced estimates, albeit with the attendant difficulties associated with costing unpaid or voluntary care.