The New Brunswick government is backing away from a plan to consider seniors' savings in determining nursing home rates.

The Liberal government said Wednesday it won't move ahead with a system that includes the assets of wealthier seniors when deciding their ability to pay for care.

“It will be cancelled and we will press reset,” said Premier Brian Gallant.

The premier and Social Development Minister Cathy Rogers also say the province has dropped a plan to raise the daily cost cap for nursing home care.

"In our first budget, we proposed changes to the nursing home policy as one of many initiatives designed to help us address a daunting demographic challenge posed by our aging population," said Rogers.

"While the policy was designed to make care more affordable for the majority of seniors, it is clear that the announcement of our intent to change the policy caused a significant amount of concern for seniors."

Which came as welcome news to seniors.

“I’m feeling like our government understands they have to deal with the people before they make decisions,” said senior Sharon Geldart.

Rogers said the government will create a council on aging and has committed to work with seniors to create an aging strategy.

Gallant said taking the proposed reforms off the table doesn't end the province's challenges in paying for seniors' care as the population ages.

He said he expects seniors groups will work with the province "to find efficiencies so that we can improve the quality of life for our seniors while addressing our financial challenges as a province."

The proposed changes to the nursing home policy were announced in the last budget and were met with stiff opposition from seniors groups.

Leader of the opposition Bruce Fitch says this is what his party wanted all along.

“They’ve put the seniors in the province of New Brunswick through unrest and so much stress for the last six months for nothing,” he said. “The minister should resign - that's one way they can save money is get the minister out of there.”

The Coalition for Seniors and Nursing Home Residents Rights accused the Liberals of breaking a campaign promise with the proposals.

With files from the Canadian Press and CTV Atlantic’s Jonathan MacInnis.