Coffee House

Social care reforms: the good and bad news

11 February 2013

Jeremy Hunt is unveiling the government’s long-awaited reforms to the funding of social care today. This is the next announcement in the government’s mid-term review series, and while it addresses a serious issue, it’s probably the biggest disappointment to date, and not just because it doesn’t match the ambition of the reforms proposed by Andrew Dilnot.

The good news is that no-one will have to pay more than £75,000 for the costs of their social care: that is the personal help, washing, and clothing, but not the cost of accommodation or food. The government says this upper limit means insurance companies will now be able to offer policies which cover the money spent up to that £75,000 cap, which means the concerns of charities and campaigners that are widely reported this morning are unfounded. It is finally getting to grips with a serious and growing problem in our society.


The bad news is that the cap itself is higher than Dilnot recommended: his review recommended that the state should step in at the much lower level of £35,000. The Treasury couldn’t stomach the £2 billion cost of that in the current climate (which Dilnot himself acknowledged on the Today programme), and that the cap needed to be higher. This brings us onto our second problem, and the one that will cause problems within the Conservative party: the funding of the £75,000 cap that the government has settled on. This £1 billion system will be funded through a freeze on the threshold for inheritance tax at £325,000 until 2019, which means more families at the lower end of the scale will be dragged into paying the tax. The threshold would have been £420,000 in 2019 without the freeze.

Remember, it was George Osborne’s party conference pledge that the threshold for inheritance tax would rise from £300,000 to £1 million that acted as a major contributor to the Election That Never Was in 2007. This has now become a Pledge That Still Isn’t Happening. Whether or not it’s the better thing to do in order to get to grips with the cost of social care, it means Tory MPs, already rather jumpy after last week’s gay marriage vote and the continuing absence of a tax break for married couples that many had hoped for, have something else to mutter under their breath about, especially when raising the inheritance tax threshold had long been marketed as a totemic Conservative pledge.

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  • Barbara Stevens

    The whole idea is a shambles. £75,000 per person; for two people that’s £150,00, the average price of the family home. That’s not including boarding costs. Who in their right minds as £75,000 to spend at once for one, and what about the other one who may be reasonably fit? Not ordinary people. Now if one needs care the home is not available to be counted, will this stay the same? It will cause great stress for elderly people. Yet, we see they still spend 11 billion per year on foreign aid, 55 million per year on health tourists, and waste money on H2, the list is endless. We won’t mention benefits for immigrants!!
    Yet being able to afford care for ones own elderly is to expensive. I think the political elite need to rethink what they do, and quickly. It would cost 2 billion to implement Dilcnot’s report, so taking off money from foreign shores would make it possible. Why is it that this is not mentioned by the press, media, etc. I don’t expect the BBC to report against it, but Sky are usually more proactive.
    No, foreigners appear more important than our own; these political elite, who believe they were so charitable today, will get their pay back come the general election. Stop the rot, dump the lot, vote ukip.

  • Smithersjones2013

    In case anyone hadn’t realised Cameron has so far trashed the Tories reputation on criminal justice, undermined their reputation on defence, attempted and failed to undermine the little democracy left in this country (AV, HoL reform, Parliamentary Representative reduction) and entered into the most despised form of government a conservative could contemplate (coalition with a left of centre partner), gaily announced himself as a Europhiliac in favour of ever closer integration handing over further powers to Brussels, increased the number of quangos including the biggest quango ever created, increased the public debt by more than any other peacetime government, helped the economy into what seems likely a triple dip recession and likely lost our triple A credit rating, repeatedly bled money from the striving working and middles classes to fund his profligate International adventures, raised more taxes than have been cut, supported energy policies which as a by-product suppress growth, indulged in political redistribution of wealth, refused to take control of immigration and plunged a dagger into the very heart of the institution of marriage and family thrice over in fewer weeks (the broken inheritance promise being the latest attack). Not to mention he could oversee the effective end of the Union of the United Kingdom as well, the way he is going

    David Cameron is to conservatism what Osama Bin Laden was to peace in the western world.

  • @PhilKean1

    I mean, as if core Conservatives and strivers hadn’t endured enough under this bunch.

    The biggest attack on them – to date – was increasing taxes on already high taxpaying parents. But it seems that was just the warm-up act.

    No, now we have a Liberal-led Coalition seeking to increase the tax burden on those whom we rely on to pay the nations bills, whilst – on the other hand – enabling those who choose to rely on the state to evade all responsibility.

    So I ask real Conservatives what they think of the latest Liberal idea.

    With this bunch unfairly penalising and increasing taxes on NET taxpayers on a weekly basis, we hear that Liberals are proposing to give, GIVE, free shares in the Nationalised Banks to all UK citizens over the age of 18.

    Can you see the ignorance and wanton prejudice in this so-called proposal?

    Instead of giving Nationalised Bank shares to those who contribute NOTHING to the Exchequer, why not – (if they HAVE to be given away, which I don’t believe they should) – give them to NET taxpayers as a sort of tax rebate?

    I have long been saying that Osborne and Cameron’s complete inability to repair EU-Labour’s damage and grow the economy will have consequences for NET taxpayers.

    Never a truer word spoken.


    • dalai guevara

      Has it perhaps occured to you that the British conundrum is the deminishing size of the NET taxpayers section of society?

      Has it occured to you that when the poorest 10%/richest 10% ratios are skyrocketing MEASURABLY here (not in Europe), that there is a reason for that? What might that reason be?
      Increasing welfare for the poor?
      Unbelievable tax strain on the rich?
      What solar system do you inhabit?

      Hand out those shares – RBS is worth zilch, every five year old knows that.

  • lee taylor

    I must point out that couples have twice the IHT allowance meaning they have an allowance of £650,000.
    Even in the south the average house price is less than a third of this and about 35% below the allowance for individuals.
    The vast majority of us won’t notice any difference one bit.

    • Russell

      More sneaky spin from labours friend Isobel.

      Innocuous headline and then the slammer line.

      “the next announcement in the government’s mid-term review series, and
      while it addresses a serious issue, it’s probably the biggest
      disappointment to date.

      Then almost as a throwaway

      “It is finally getting to grips with a serious and growing problem in our society Innocuous headline.

      So which is it Isobel? The biggest disappointment to date…….OR……..”getting to grips with a serious and growing problem.

    • HooksLaw

      Correct. IHT should still rise I think, its cost is an uncertainty hanging over many ordinary people, but on the other hand having to lose your house completely to pay for social care is worse than any tax.

      But as you pointed out to an hysteric in the Telegraph comments, that rag’s claim that the limit was the average price in the south on England was a lie. The Telegraph sinks ever lower – you would hardly think it possible.

      Some people of course will notice otherwise the money will not be saved to fund the cost of social care. But not ‘average’ people. Indeed its ‘average’ people who will benefit most from the new certainty about social care.

      • lee taylor

        The telegraph has been taken over by a bunch of upper middle class lefty hypocrits.
        Sadly the idiots who comment on those pages can’t see it.

    • Smithersjones2013

      But that doesn’t apply to the legacies they want to give their children to have now does it? And at what rate does the government charge inheritence tax? 40%! The most heinous tax their is except for income tax on the most wealthy.

      So when it comes to inheritance the children of middle and working class southern parents will be taxed to the hilt if they parents have made anything of their lived. So much for the Tory Party being the party of the family. The Tory party is more and more the party of the entitled detached parasite political and bureaucraticclass and nothing else (much like the Blairites were).

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