The Tories have attacked social service provision for the elderly, which can see people losing their homes and savings to pay for residential care.

Reviving Conservative heartland ideas of a thrifty property-owning democracy and individual responsibility, William Hague on Friday slammed a system that can penalise people who have made "prudent provision" for their old age.

During a visit to a Yorkshire care home, Hague, joined by Liam Fox, launched a new fund limiting the sums pensioners may have to pay for long term care.

The issue has already provoked controversy with the Labour dominated Scottish executive offering long-term residential care for free whilst under a Labour government in England pensioners face means-tests for the same treatment.

At present anyone with assets of over £18,500 can be faced with bills amounting to hundreds of pounds per week losing homes and savings in the process.

Hague attacked the government for fostering dependency and refusing to trust the instincts of people look after themselves and their families.

"People everywhere want to take responsibility for themselves and their family when it comes to the care they may need when they grow older. But the government seems to go out of its way to discourage people from taking responsibility. What is the point of saving to be able to leave something for your children and grandchildren if the state confiscates almost all your savings - and your house too - to pay for care costs? What does it say about personal responsibility if someone who has not saved a penny during their lives is paid for by the state, while someone who has scrimped and saved has their life savings taken off them for the same care?," he said.

Shadow health secretary, Liam Fox outlined plans for a ring-fenced Long Term Care Fund sufficient to meet the average expected cost of long term care. If individuals make savings of £25,000 - £30,000 a Conservative government would indemnify them from any further costs of care preserving their assets should residential care be needed for longer than the average.

"I want to create a responsible society. I want to create a society in which people are rewarded for thinking ahead and are encouraged to save. I want to create a society in which people do not live under the threat of the government confiscating their life savings and their family homes," he said.

Labour has argued that the Conservatives are unable to match Labour's better standards in care because the Tories can not match the governments spending pledges on social services.

A Labour spokesman dismissed the move: "The Tories never supported free nursing care in government.and without meeting Labour's spending pledges Conservative proposals are pie in the sky."

And the Liberal Democrats accused the Conservatives of seeking to privatise the health service.

Health spokesman, Paul Burstow said: "The Conservatives have given up on the elderly. The Tories are offering nothing to pensioners on modest means or those on middle incomes unable to pay for long-term care bills or provide a private pension for themselves. The National Health Service was built on the principle of being national, comprehensive and free at the point of need."

Help the Aged's head of public affairs, Mervyn Kohler, said niether of the two main parties had much to offer the elderly.

"Neither the Conservatives nor Labour in England have grasped the key point that long term care is just as vital as life saving hospital treatment. This new idea from the Conservatives effectively punishes a sufferer from Alzheimer's Disease, requiring them to pay up to £25,000 for their bad luck," he said.