Care leaders cautiously optimistic of suggested government tax increase to reform social care

Care leaders and ministers have given a cautious welcome to reports the government is considering an increase in National Insurance to pay for social care reform.

The Telegraph and The Times said the government was looking at raising National Insurance social security contribution rates by between one and two per cent in return for capping the amount an individual would have to spend on social care costs in their lifetime.

The move would break a 2019 election promise by Prime Minister Boris Johnson's Conservatives not to raise the rate of income tax, the VAT sales tax or National Insurance.

The Independent Care Group (ICG) chair Mike Padgham said: “This is positive news and an indication social care reform could at last be on the way.

“We have long campaigned for better funding for social care and believe that people would be prepared to pay a little more in taxation or National Insurance, or a combination of both, in return for a properly-funded, fair social care system.

“Personally, I think an increase in Income Tax might be a fairer way to do it.”

'If the option is to raise National Insurance there are issues'

It has been reported that Boris Johnson favours a one per cent rise in the tax, while the finance ministry is possibly looking at a higher rate of up to 1.25 per cent, as reported in the Telegraph, while The Times said health minister Sajid Javid had pushed for as much as a two per cent rise for everybody of working age.

Sir Andrew Dilnot, who led a cross-party commission on care funding, had previously suggested making retired people pay National Insurance towards the annual £10billion cost of overhauling the UK's care system.

However, Conservative former health secretary Jeremy Hunt has warned the government against a National Insurance increase saying it would “disproportionately target the young.”

The Shadow Work and Pensions Secretary Jonathan Reynolds was also cautious about funding social care by raising National Insurance. He told Sky News: “If the option is to raise National Insurance there are issues as how fair National Insurance would be to raise the money.”

'It is vital that any government proposals provide long-term ambition...rather than quick fixes'

The National Care Forum (NCF) has said the wait for social care reform has been “far too long” and warned the government must take this opportunity to “fulfil its commitments” and make sure reform and investment in social care is “sustainable for the long-term.”

Vic Rayner, chief executive of NCF said: “It is vital that any government proposals provide long-term ambition for people and communities rather than quick fixes. Reform must move beyond the narrow focus on capping costs if we are to have a proper public debate.

“We owe it to everyone who receives care and support now and will need it in the future to have a social care system that can be a source of individual and national pride. To get there we need an ambitious reform agenda with people at the heart of it and underpinned by sustainability, innovation and investment in the incredible workforce. The government must act now to prioritise social care.”

'I also want to see the government talk about workforce in social care'

The ICG is also wanting the reforms to include changes to stop the crisis in staffing. With the government predicting 40,000 staff will refuse to have the vaccine and consequently lose their jobs as well as Brexit, carehome.co.uk has seen the number of job vacancies nearly double in the last six months, from 4,832 in January to 8,142 currently. In August 2020, job vacancies stood at 4,959 and in August 2019, they were 5,241.

Mr Padgham said: “At the moment the crisis in social care staffing is at the uppermost of providers’ minds as they struggle to get enough staff to cover their shifts.

“Any reform would have to tackle the staffing issue and ensure we create a sector which is properly rewarding to those working in it.

“We need proper, sustainable funding, for dementia to be treated as other serious illnesses are, and funded accordingly, and for a proper pay and reward structure for social care staff.

“Capping care costs – however it is done – is only the beginning. A good beginning but just the start.”

Mr Reynolds added: “I also want to see the government talk about workforce in social care. It’s the biggest sector that doesn’t get the living wage and I don’t think we can tackle this until we take seriously the terms and conditions of the people who work in social care.”

A spokesperson for the government said: “It was committed to bringing forward a long-term plan and to reform the social care system.”