Is A Holistic Pension Style Social Care Reform The Answer To A Broken System?

Countless Prime Ministers and Chancellors have waxed lyrical and preached about the healthcare system in recent years. Whilst each one grapples with graphs and recite rehearsed percentage figures, one element remained clear: social care in the UK is underfunded and reaching crisis levels.

Since the current government entered number 10 in 2010, public funding of social care has reduced by 3% in real terms. Conversely, the percentage of the population over the age of 65-years-old has increased by 19% during the same period. The disparity is staggering and the gulf is only widening.

How can a demographic that has grown by a fifth survive on a budget that has dwindled by 3%? Damian Green MP and the Centre for Policy Studies have argued that the answer is an overhaul of the current system by employing a central government system using the state pension model to create a Universal Care Entitlement, guaranteeing everyone a decent standard of care.

The ‘Fixing the Care Crisis’ Report found that the current social care system is ‘financially and politically unsustainable, opaque and unfair,’ for the 5.3 million users over the age of 75-years. The fact that this number will double in the next four decades means that a radical approach was needed to ensure everybody gets a basic level of care.

This baseline level of care was suggested through a Universal Care Entitlement. Similar to the current state pension system, it will commit to providing a decent level of equal support to all sections of society using this baseline tier. However, the report does not specify what it constitutes as ‘decent’, and does not specify what each person would be entitled to.

It suggests replacing the current patchwork of provision and postcode lottery with a blanket, consistent provision that will not change, regardless of patient’s location in the UK. However, the government’s commitment to social care, using this scheme, would cap the provision offered to each patient.

A Care Supplement, in the form of a standard monthly payment or one off payment, could then be purchased by the patient to help improve the level of care they are offered. The report claims that this would ensure all people are offered standardised support but allows people to use their assets and capital, like equity in their homes if they have this, to finance a more sophisticated, even luxurious, level of social care.

Whilst this may be a way of ensuring property owners are not forced into sacrificing their homes to pay for their care, a supplementary tariff of luxury could be seen as discriminatory to the growing number of people that do not own property.

Similarly, the proposed 1% increase in National Insurance contributions for those over the age of 55 to help finance the changes have also been considered discriminatory. A 1% levy imposed on those aged between 50-years and 64-years would mean an additional £308 per person or £2.4 billion overall; the amount needed to plug the funding gap.

Additionally, the report claims that taxing the winter fuel allowance would also provide £350 million per year towards social care. Despite the fact that the UK does not operate using a hypothecated tax system, it is speculated that any savings could be used to finance improvements to social care in the UK.

Whilst current funding models and deficits suggest that there is a clear social care crisis that requires radical reform, are we ready to financially tier the level of the support the NHS is willing to offer?

Matt Hancock, Health Secretary, commented:

“It’s such an important area. The thing about social care is, to get a sustainable solution, it needs cross party agreement, a bit like when you make big changes to pensions, and getting that sort of cross-party agreement when Brexit has been so alive has been really difficult. We need to take some of that partisan politicking out of social care to try and get a long-term solution.”

Do you think these reforms would help to improve the plight of those losing their homes to pay for social care? Would these changes improve a broken system?

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