There’s No Pockets In A Shroud

by Les May

WHEN Theresa May called a General Election in 2017 one proposal in the Tory Manifesto was immediately dubbed a ‘Dementia Tax’.   At present councils pay for all or part of a person’s social care if they have less than £23,250 in capital. This applies if a person is in a residential home or nursing home. The cost is then recouped from their estate after their death.  May also wanted to recover from their estate the costs of care given to people in their own home, to raise the protected sum to £100,000 and axe the Winter Fuel Allowance for more affluent pensioners.

These proposals went down like the proverbial ‘lead balloon’.  They were attacked by both Labour and the Liberal Democrats.  The Tories could reasonably argue that this was a better deal for relatively poorer people who needed residential care and would mean that the costs of care given in the home would be recouped only from the more wealthy.  Strictly speaking of course that’s not quite true.  Until someone finds a foolproof, (and fire proof?) way of putting ‘pockets in a shroud’ it will be the beneficiaries of the estate who will have their inheritance reduced.

Social care today is in the same state as health care was in the 1930s, a hodgepodge of partly national and partly local provision, and funded partly by those who have the misfortune to need long term care, often with pressure applied to their spouse or family, and partly from the public purse.   Unlike the NHS which is ‘free at the point of delivery’ social care is not built around a ‘shared risk model’.

Such a model would recognise that throughout our life we all run a small risk of requiring social and residential care due to age, infirmity or accident, hence we should all make a contribution to funding that care for those who need it.

The simplest and most effective way of doing this is via the tax system.  But here we have a choice we can either raise the money through a tax on income or through a tax on wealth, specifically a tax on inherited wealth.  When the costs of care are recouped after someone’s death the burden falls on the estate not the deceased individual.   If you doubt this you might like to consider that a dead person does not own their own body, so how can they be said to own property or other assets?

Switching to such a funding model would go much further than Labour’s 2010 proposal for a ‘National Care Service’.  Labour shied away from a fully tax funded system as being too costly to be a sustainable model on the basis that it would put too high a financial burden on the decreasing proportion of the population that is of working age (p126 below).  I fail to see that a tax based upon inherited wealth would not be sustainable.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/238441/7854.pdf

The distinction between social (or personal) care and medically required care is an artificial one.  Dementia is a chronic medical condition; it results in sufferers requiring social care in their own home.  Why should the necessary care for both the condition and its side effects not come from the same source?

May’s ‘crime’ was to try to have an adult conversation with people who prefer not to think about the problem of funding care for older people and send to parliament people who are similarly reluctant to talk about it.  In 2019 the lesson was learned, no one wanted a caning for talking out of turn.  The Tories pledged an extra £1bn, the Lib Dems £3bn and Labour £10bn by 2024 to fund in home social care for all who needed it and to ensure that carers were paid at least £10 an hour with no ‘zero hours contracts’.

These are significant sums of money, but even Labour’s proposals leave the question of funding residential care for those who need it unresolved.  This matters because the available funding has an impact on the quality of care which is provided.   Nothing illustrates this more sharply than the spectacle of the owners of ‘run for profit’ residential homes asking to be provided with kit to protect staff and residents against coronavirus, and being told it is their responsibility.

We need a politician with vision and determination to keep fighting for a universal and comprehensive care model for those who need it due to age or a chronic medical condition funded by a tax on inherited wealth, in the face of short sighted claims that it is a ‘death tax’ or a ‘tax on the sick’.  As I said earlier, ‘there’s no pockets in a shroud’.  Even though I am unlikely to be the recipient of inherited wealth it seems to me it would be better to have the certainty 80% of something rather than run the risk of 100% of nothing!

http://www.renewal.org.uk/articles/death-and-taxes

https://www.kingsfund.org.uk/blog/2017/03/death-tax-social-care

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