Make over-40s pay social care premium, MPS advise

Group says money from Ni-style scheme would be set aside to deal with demand for elderly care

SOCIAL care should be funded by the over-40s through a National Insurance-style savings scheme, a powerful group of MPS say today. People would start paying into the scheme at 40 and continue once they are 65, with the money set aside to cope with the growing demand for elderly care, according to the housing, health and social care committees.

In a rare joint report the group also called for an extra inheritance tax charge on large estates to help anyone who needs long-term care but may not be able to afford it.

Council tax bands should also be revised, with the extra money raised being spent on the needs of older people, the MPS said. The suggestions come amid a growing funding crisis in social care, and the MPS warn that without drastic measures soon the whole system could collapse amid claims of a £2.5 billion black hole in the next financial year alone.

Under the plans for a new Social Care Premium, employers would also pay in and a minimum earnings threshold should be set to protect those on low incomes.

The fund would be protected and only used to help support people in old age with things like washing, dressing and eating – free at the point of need. Accommodation costs should remain means-tested, the group of MPS said.

Sarah Wollaston, the Conservative MP, said “doing nothing cannot be an option” on social care and urged the Government to take urgent action.

Ministers are expected to outline their plans for social care in a delayed White Paper which is now likely to be published in the autumn. But Clive Betts, the chairman of the housing, communities and local government committee, said: “The social care system is in a critical condition and there is an urgent need for more funding both now and in the future to ensure people are properly looked after.

“Given the huge funding gulf, the Government should now take the opportunity to build both a political and public consensus around the need for a new social care premium to secure a fair and sustainable system in the longterm.”

After Theresa May’s attempt to bring forward plans to reform social care funding at last year’s election – branded the “dementia tax” and blamed for a disastrous loss of support for the Tories – the report emphasised the need for cross-party support for change.

Richard Kramer, deputy chief executive at the disability charity Sense, said: “We know that the public is in favour of greater investment in social care and this bold, innovative proposal from the select committee is one of a number of different ideas that the Government should be considering to avert a social care crisis.”