Funding Social Care in England: What the Main Political Parties Propose: UPDATE

At the time of writing this article, political parties have published their manifestos and are actively campaigning throughout the country for our votes. Predictably, there is little agreement amongst the parties on most things. There is one point, however, upon which all parties agree, and with which few people in the country would take issue: that point of agreement is that our social care system needs reforming. There is no agreement, though, about how this reform will be funded. This article very briefly looks at what the main parties propose for funding social care in England.

The week just gone, week beginning Monday 15 May 2017, saw the Conservatives publish their manifesto. The proposals contained in that manifesto for funding social care have received quite an amount of media attention. At the moment, financial help with social care fees is provided to people with savings less than £23,250. With regard to domiciliary care, the equity in your home is not taken into account (it is for residential care fees).

The Conservative's proposal is that help with social care fees will no be available for people with savings up to £100, 000. However, the equity in your home will be included in the calculation for qualifying for help with both residential and domiciliary care fees. You will not have to sell your property during your lifetime nor whilst a surviving partner is living in your home. You will, though, have to take some form of loan to pay for your care fees until your savings drop below £100,000.

The thing that occurs to me is that the long term consequence of this may be to discourage home ownership and saving and in a generation or two's time we will be back to a social care funding crisis. To prevent this occurring there may need to be penalties incurred by those who dispose of assets in their lifetime and/or some kind of social care tax or insurance. Which brings me to the Liberal Democrat's proposals.

The proposals from the Liberal Democrats include an immediate one penny rise in the basic, higher and additional rates of income tax. This will raise, it is claimed, £6 billion that will be used to fund the NHS and social care. At some future point, this one penny increase will be replaced by a health and care tax, which may involve a reform of our national insurance system. Eventually, the aim is for one health and social care budget.

Labour's proposals include developing a National Care Service for England. Social care will receive an extra £8 billion during the first Parliament of a Labour government, with an additional £1 billion in the first year. The National Health Service and the new National Care Service will require £3 billion extra in the "first years". A limit will be placed on an individual's lifetime contribution to care fees. To pay for these proposals the Labour manifesto suggests options including wealth taxes, employer contributions and/or a social care levy.

The inescapable fact is that the money to fund social care has to come from somewhere. To give more money to social care either some other area of Government spending receives less, or more money is raised. And the ways of raising more money are fairly limited.

Update

As you are undoubtedly aware, Teresa May announced last week (week beginning 22 May 2017) that, should the government be re-elected, there would be a cap on the amount that you are expected to pay for your social care; notwithstanding that this commitment was not present in the Conservatives' manifesto.

Garry Costain is the Managing Director of Caremark Thanet, a domiciliary care provider with offices in Margate, Kent. Caremark Thanet provides home care services throughout the Isle of Thanet. Garry can be contacted on 01843 235910 or email garry.costain@caremark.co.uk. You can also visit Caremark Thanet's website at www.caremark.co.uk/thanet.