One of the pressing issues that will face Sajid Javid as the new Secretary of State for Health is how to reform social care.
Bluntly, the problem is that there is insufficient provision because we don’t spend enough on it. That much is generally agreed. The key question on which a consensus has yet to be reached is how are we going to pay for the much greater sums that we will need to spend.
I sat on the legislative standing committee which introduced the distinction between healthcare, provided free at the point of use by the NHS, and social care which is means-tested. This distinction is not always sustainable, especially where patients with dementia together with a number of complex medical conditions are concerned. The assessment procedures to deal with these cases and to provide ‘Continuing NHS Care’ -where all the cost are met by the NHS- leave much to be desired, they are applied differently giving rise to a postcode lottery and to a perception of unfairness.
That sense of unfairness however, is much wider: People who have been lucky, wise, hard-working and successful in building up their savings will find that have to pay the full cost of their care. Whilst, those who have been impecunious or just much less fortunate, will have their social care paid for at the expense of taxpayers.
That perception of unfairness is an inevitable consequence of any system reliant on means-testing. We just live with it across other aspects of our welfare state; Where, for example, access to Universal Credit is denied to those who have significant savings, even though they have lost their income.
The only way to avoid this perception of unfairness is to remove any individual responsibly entirely by making free provision universal.
Universal benefits, irrespective of income and assets, come at an enormous cost to taxpayers, with all the consequences that higher taxation has for reduced incentives, investment and productivity.
It comes down to this simple question in the end: do we want to nationalise another aspect of our collective life by simply expecting the state to provide it?
Politicians often refer to the ‘scandal’ of elderly patients having to sell their homes to meet the costs of residential care. Of course, we’d all much prefer to leave our assets to the next generation, but equally, I was always taught to save up for a ‘rainy day’. Well, when you need social care, isn’t that the rainy day?
I do not believe that we need to commission another great review of the options. The last such review developed a workable solution (and which Parliament legislated to implement): Sir Andrew Dilnot proposed a cap on the amount that anyone would be required to spend on social care if they had the means to do so. Beyond that cap the taxpayer would meet the costs. He suggested a cap of £75,000. Clearly, the lower the cap the greater the burden that will be borne by taxpayers.
The advantage of a cap however, is that it gives the insurance industry the certainty of a maximum liability which will enable the development of affordable financial products to protect those customers who want to safeguard their assets and savings for the next generation.
The Dilnot proposal is a means of getting more funding into social care on the basis of a ‘mixed economy’, whilst going some way to addressing the unfairness of a means tested system. But we must not hide from the reality that it comes at a greater cost to the public purse which inevitably will require either higher taxes or less expenditure on other aspects of government provision, and we need to be open and honest about recognising that.