Johnson presses Sunak over cap on cost of social care in old age

Johnson presses Sunak over cap
on cost of social care in old age
Chris Smyth, Whitehall Editor
Saturday April 24 2021, 12.01am, The Times

The prime minister has met with the chancellor to try to solve the social care
crisis
J E S S I C A T AY L OR/ U K P ARL I AM E N T / E P A

A cap on the amount older people pay for social care is being closely considered
by Boris Johnson as he tries to reach a deal with Rishi Sunak on reform.

The prime minister met the chancellor recently to kick-start intensive government
work intended to solve the crisis in social care this year. He hopes to give a taste of
it in the Queen’s speech next month.

Johnson has taken a keen interest in decade-old plans that would cap the amount an
individual had to contribute towards their own care, with the state picking up the
rest of the bill, seeing it as a potential way to meet his manifesto pledge that people
should no longer have to sell their homes to pay for help.

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This is the prime minister’s favoured option according to some accounts. However,
other sources dispute this.
A £45,000 cap is likely to be the starting point for discussion, which would cost
£3-5 billion a year. The Treasury is likely to push for a higher cap to save money
but it is understood that talks have not yet reached that stage.

People with assets of less than £100,000 would have all their care costs met by the
government under a much more generous means test. At present people with assets
of more than £23,250 are responsible for all their costs.

Sunak is yet to be convinced that the government should press ahead with the
policy and has ordered a more detailed review of it and other options.

The Treasury has been accused of “delaying tactics”. However, sources insisted
that Sunak accepted the need to deal with fragilities in social care highlighted by
the pandemic while noting the precarious state of public finances.

Yesterday Johnson said that the government “has been massively investing in
social care throughout the pandemic” and promised that “there will be more to
come”.

The elderly care system has been crumbling for at least a decade, with 1.5 million
people now not getting the help they need. Frail older people are increasingly
reliant on poorly-paid staff working for struggling providers as councils cut back
their rates.

When Johnson came to power he promised to “fix the crisis in social care once and
for all”, and he said last month that it was “highly likely” plans would be in the
Queen’s speech on May 11. A full plan is unlikely by then but one may be ready
for a later spending review.

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The Treasury has been reluctant to agree to costly reforms. A cap on costs alone
would also not deal with those denied help or improve the quality of care.
Chancellors have been wary of spending billions on a policy that could be
criticised for not doing enough.

Solving all three problems could cost well in excess of £10 billion and successive
governments have instead relied on bailouts of about £1 billion a year.

In a letter to The Times today the heads of three leading health think tanks say that
Johnson “has a chance to succeed where his predecessors failed”. Protecting the
value of people’s houses is not enough, say Richard Murray of the King’s Fund,
Jennifer Dixon of the Health Foundation and Nigel Edwards of the Nuffield Trust.
“The underpaid workforce must be fairly rewarded, expanded and supported to
develop new skills. And thousands of overstretched care providers need stable
funding.”

What to do about granny and grandpa has terrified governments for decades (Alice
Thomson writes). In the past 20 years alone there have been 12 consultations,
white papers and green papers on social care in England, as well as five reviews
and commissions.

When Gordon Brown tried to build cross-party support for reform his idea was
labelled a “death tax” by the Tories. David Cameron’s coalition was too frightened
to include it in their health reforms and when Theresa May tried to make it a
central theme of her 2017 manifesto it derailed her election campaign and became
known as the dementia tax. Boris Johnson promised a long-term financial
settlement on his first day in No 10 but it has stayed at the back of the queue.

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The refusal to tackle social care proved to be a killer when the pandemic started
last year. When overstretched hospitals became overwhelmed, they sent patients to
care homes to recuperate; nearly 26,000 residents have died of Covid-19.
According to Age UK, 1.4 million older people were already lacking adequate
home support, with visits sometimes lasting only 15 minutes. Care workers are
paid an average of £8.67 an hour, barely above the minimum wage, and a quarter
are on zero-hours contracts.

Old age had become a lottery as those with cancer or heart disease were looked
after by the NHS while those with dementia had to pay for residential care if they
had assets worth more than £23,500. So the government’s tentative plan for the
introduction of a £45,000 cap on care costs for individuals should be welcomed.
There should also be a £100,000 floor, meaning that anyone with assets up to that
level would be eligible for support.

The proposal is based on the recommendations of the 2011 Dilnot Commission and
would be funded by the taxpayer. It would end our hopelessly unfair system by
starting to pool the risk without unduly penalising those who have saved during
their lives, as Sir Andrew Dilnot suggested.

The Treasury would have to find billions of pounds to fund it and it would still be
insufficient; the government needs to do more. With one in five Britons predicted
to be 65 or over by 2030 this is a crisis that is only going to deepen. In Japan,
where they now spend more on nappies for adults than babies, they have
introduced a tax for over-40s and people pay 10 per cent of their care bill if they
can afford it. Britain could increase national insurance by a penny for the over-40s.

Another option would be a one-off payment on retirement, which would go into a
social insurance scheme. Pensioners without enough cash could defer until after
death with the money taken from their estate. The “accumulated housing wealth”
held by those in retirement is now estimated at £1.5 trillion.

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There could also be greater use of personalised care budgets, allowing individuals
and their families to make decisions about what best suits their health and social
care needs.

What cannot happen, as even Johnson has now recognised, is for us to ignore the
problem any longer. With 7.6 million people caring for an elderly relative, 15 per
cent of the adult population, and many more worrying about their parents or their
own future needs, social care has reached a tipping point. Even a partial solution
will mean that at least some good will have come out of the Covid crisis.

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