Who should pay for care?

There are three possible answers to who should pay for an individual’s care. The individual themselves may have the money to do so. The individual’s family may have the money and the capacity to provide the care. The state – in other words the rest of us – could do so.

By common political consensus in the UK we take a differing view on who should pay for a child’s care, and who should pay for an elderly person.

All mainstream parties and most people agree that as a child cannot work and does not usually have any money of their own, the parents should normally provide. We expect mother and father, or mother or father, to offer food, shelter and clothing, and to look after the child when not at school. Both parents are expected to contribute financially where they can. The state steps in if the parental income is insufficient, offering help with money and housing. The state also has powers in extreme cases of poor parental behaviour towards the child to remove the child and find surrogate parents willing to look after the child.

In the case of elderly people more emphasis has been placed on the elderly person themselves contributing financially to their care and maintenance where they have substantial savings. No party has proposed making children responsible for their elderly relatives,nor would that be an acceptable proposal, though in practice many families do provide answers to the care needs of their elderly members. The state provides all healthcare free, and provides free places in care homes for those who need them and have little by way of assets or income. There has also been an issue over differing treatment of an elderly person who chooses to stay living in their own home, and those who move into care homes, vacating their old property. There are issues over what constitutes free healthcare, and what is normal living cost.

The contentious question revolves around how much capital an elderly person should be able to pass on after death, and how much should be used up during their later years on paying for their living costs and care.I am interested to hear your thoughts on the right balance over who pays for what. In the next post I will talk more about the various options.

Published and promoted by Fraser Mc Farland on behalf of John Redwood, both at 30 Rose Street Wokingham RG40 1XU

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77 Comments

  1. eeyore
    Posted May 20, 2017 at 6:21 am | Permalink

    There is moral hazard here. If society will give me a good thing for nothing, why should I pay for it myself?

    A few weeks ago JR amusingly drew attention to a Mr Feckless. How would he behave? He would cash in his assets, eat, drink and be merry, before he dies hand a good chunk of cash to his laughing and cynical heirs, and leave the taxpayer to pay for his care in old age.

    Mr Prudent, on the other hand, who values his integrity, deplores sponging off others and husbands his assets, would find himself stripped of all but a fraction of his estate. His pauperised heirs would curse their loopy old papa and call his prudence nothing less than folly and madness.

    When government, possibly for the best of motives (but possibly not), seeks to redraw the eternal moral parameters of society, it must not be surprised when people take it at its word.

    • Lifelogic
      Posted May 20, 2017 at 6:43 am | Permalink

      The system just encourages Mr Responsible and Mr Sensible to become Mr Feckless so many do.

      • BobE
        Posted May 20, 2017 at 3:01 pm | Permalink

        Doesn’t one simply equity release and spend it. Even deposit on kids house.
        Bob

        • Hope
          Posted May 21, 2017 at 9:42 am | Permalink

          JR, we are already paying for it twice in our community charge. Why demand we sale our home as well? It should be one or the other. Your party is trying deceive people and pass the blame to local councils.

          Stop taxing us in our community charge or ask us to pay for own care. Stop trying to forcmake us to pay for your mass immigration policy.

          • Dennis Zoff
            Posted May 22, 2017 at 1:03 am | Permalink

            JR “The state provides all healthcare free”

            Nothing is free…most pensioners were hardworking/in work/honest individuals that had been paying personal tax and NI for the best part of 45+ years (and some still do pay tax as pensioners today). Health care has been paid for in our taxes. Please do not make out the Government has been providing anything free! At best this an oxymoron!

            In Germany, citizens pay into a private health scheme (Krankenversicherung. Krankenkassen). This money is wholly used for providing its citizen’s with quality health care during their working years and post working years (Pensioners). The difference is the state cannot access this money for any other purposes other than healthcare for the sick and aged. The system works extremely well with very high-efficiency rates, simply because the Government does not have a hand in running it! In the UK – where there is a Government official involved generally incompetence follows…just my personal experience!

            In Germany:

            1. Minimal operation waiting lists
            2. Minimal waiting in AE
            3. Post operation rehabilitation centers
            4. Extremely modern hospitals – max two persons to a room with full facilities
            5. Most modern equipment…which makes our hospital equipment look as if it came from China
            6. Long term expensive cancer treatment for all – no limits!
            7. Immediate access to Doctors
            8. Highly paid national rescue services
            9. the list goes on and on.

            My German wife worked as a Professional Practice Consultant in the German system and was aghast when she came to the UK. Her comment, drawing on an old one, “Lions lead by donkeys”. She has many times paid tribute to the professionalism, training, hard working enthusiastic nature of individuals, with general integrity from all the staff. But appalled at the waste, bad management, exceptionally long waiting lists and lack of post op facilities on offer.

            Some of the hospitals and their condition (old Victorian buildings) were absolutely atrocious. She had thought the NHS was one of the best run healthcare systems in the western world but believes, what she has seen, it is at best second rate. The Government appears not to understand or have real concern for the issues!

            Health care for our old people has been paid for by them via their many years of taxes! Let’s be fair to them and not steal their hard earned legacy!

    • bigneil
      Posted May 20, 2017 at 10:23 am | Permalink

      Eeyore, your first line says it all why immigrants are so desperate to get here. They get a large rise in living standards for getting here ( illegally or not doesn’t matter ). Once here they will do anything ( again illegal or not doesn’t matter to them ) so long as they get to stay here ( even in jail ) and then get to bring their entire family here to also be a burden – and in many cases a danger as well – to the taxpayer. Uneducated and seemingly unemployable except for cash-in-hand ( no-tax paying but benefit claiming and NHS using ) car washing, they are better off for getting here and doing, and contributing, NOTHING They also know that committing the worst crimes give them the “can’t be sent back, i’ll be persecuted)” claim, which means here, and a burden to us, till they drop.

      • Hope
        Posted May 21, 2017 at 9:43 am | Permalink

        Well said. Spot on.

  2. Richard1
    Posted May 20, 2017 at 6:43 am | Permalink

    The Conservatives’ proposal seems to be heading in the right direction – it is reasonable enough that people pay for their own care if they can. There is no reason the state should subsidise people in order they can hand on an inheritance. Equally there is no reason for the state to protect an inheritance in the form of a house rather than any other assets.

    • Graham
      Posted May 20, 2017 at 7:54 am | Permalink

      ‘Subsidise people in order that they can hand on an inheritance’

      Got a great stretch then in your mind to follow this logic into a whole range of things such as general taxation, council tax, healthcare & dental fees. After all the net effect is still to leave a residual inheritance.

      Why pick on this one alone?

    • Anonymous
      Posted May 20, 2017 at 8:40 am | Permalink

      Richard 1 – I agree. But it is patently wrong that the person’s estate goes not only on the cost of his own care, but on subsidising a feckless person’s stay in the same care home.

      Of a £1000 per week care home bill it is likely that only £700 is being spent on the person paying it – the rest goes to subsidise those with no provision.

      One expects also that people who have set up their own pensions will be denied the state pension and will end up no better off than someone who has avoided work.

  3. stred
    Posted May 20, 2017 at 6:51 am | Permalink

    Dilnot came up with a sensible proposal- that the government should provide an insurance against long term care, which would share the risk for all, not just the unlucky. Then the amount payable by the individual could be restricted to a lower amount. The May proposals would wipe out most of the family estate for most voters in Conservative heartlands. Another blunder to be reversed somehow. Strong and what was it? U turn U turn ….

  4. agricola
    Posted May 20, 2017 at 6:53 am | Permalink

    For the next ten years we are stuck with the system we have. My instruction to government is to get on with fracking shale gas, create a fund, ring fenced from government, built from the tax take and invest it. Use the investment managers who are most successful in the private sector on three year secondments. Do not let civil servants anywhere near it, their track record at running anything is dreadful.
    After ten years start using the income, not the capital, to pay for the care of the elderly. It is one of life’s lotteries as to who may need care. Their property and the inheritance of their children should not be forfeit.
    Go talk to the Norwegians and find out what they have done and learn from any mistakes they may have made, but get on with it. The main distraction for the next two years is Brexit, but this does not mean that everything else is on hold. My long piece yesterday broached this subject. Do not think it was a criticism of our host who I see as a real conservative. His exclusion from senior office confirms his credentials, even if I do not always agree with him.

    • a-tracy
      Posted May 20, 2017 at 10:10 am | Permalink

      The civil servants in my area put their investments in Iceland before the crash and lost the lot, leaving big holes in their pensions which rate payers had to top up.

      • Alan Hill
        Posted May 21, 2017 at 5:59 am | Permalink

        Why should the ratepayers top up deficits in public service pensions ?
        My company pension ended up in the PPF (Pension Protection Fund) and many of my ex colleagues found themselves with far smaller pensions than expected plus no 25% draw down.
        It is iniquitous that public servants should be featherbedded in this way.

  5. Lifelogic
    Posted May 20, 2017 at 6:54 am | Permalink

    It seem to me that most people should provide for themselves (and most do not any need long term care anyway). A few do however need many years or care and some sort of insurance here or government cap might make sense. Robots and automation will have to reduce the costs of long term care too.

    The proposal of the government will just encourage people to reduce their assets and dump these costs onto other tax payers. Once again the responsible will pick up the bill for the feckless. The feckless will will grow and the system will fail.

    • alan jutson
      Posted May 20, 2017 at 8:28 am | Permalink

      Lofligic

      Sorry, robots will never take the place or love of human care, its too individually complex for that, unless you call automated euthanasia a care package.

      Never yet seen any robot that can feed someone, or wipe their mouth or backside when needed, what an absolutely horrible thought.

    • a-tracy
      Posted May 20, 2017 at 10:13 am | Permalink

      The Labour Party sold them that insurance already- it was called National Insurance, cradle to grave care and the public should be reminded who got these current pensioners in this mess in the first place, over promising and borrowing from the next generation. The Conservatives have been poor fund managers also, we have had 30 years of very poor financial management, compounded by borrowing for an equally financially poor EU, just look at the leaving bill talks to see how much they’re over promising and spending right now.

      • getahead
        Posted May 20, 2017 at 7:19 pm | Permalink

        No worries Tracy. There’s plenty more where that came from. It makes you despair. We elect these people yet they do not care about this country or its inhabitants. Loadsa money to spend on foreign aid and the EU.

  6. sm
    Posted May 20, 2017 at 7:05 am | Permalink

    I do not believe in the kind of feral society in which there is no State support at all for people suffering from misfortune of any kind.

    However, we have to learn that ‘other people’ cannot be expected to totally pay, via constant increases in taxation, for what is foreseeable.

    Most of us will grow old, and get the diseases and malfunctions of old age. Modern medicine will – at huge expense – postpone our death from cancer and stroke and Alzheimers, but in significant numbers expensive social care will then be needed.

    If MY home must not be sold to defray expenses because I wish my children to inherit it, YOU and your children must pay for my care. That is unjust.

    ps. There is no perfect system that will be just and fair to everyone involved, and we should stop pretending there is.

    • Anonymous
      Posted May 20, 2017 at 8:45 am | Permalink

      sm – Homes are worth so much it is worth ordinary people employing a good accountant nowadays.

      There is nothing just about a person being forced to sell their home to subsidise a layabout who has ended up in the same care home as happens now.

      Care home bills are greatly inflated to subsidise state funded occupants as the state funding is too low.

    • a-tracy
      Posted May 20, 2017 at 10:28 am | Permalink

      I hear you. It does need more thought.

      Why should a woman I know that’s lived well in a new free Council house after leaving her first partner, having three more children with no supporting fathers, never had to work even after her children went to school because of clever timing of reproduction, now get the same care home as me because she’s so called poor? She’s the one going to France, Portugal, Centre Parks, even Florida, owns a car, sky tv, all have fancy phones etc. Why should foreigners come in not having contributed 39 years but get our pension credits which gives them the same money as our state pension plus the housing benefit. How could our legislators be so * stupid to draft our legislation to benefit everyone else but the people who paid their own insurance.

  7. David Murfin
    Posted May 20, 2017 at 7:15 am | Permalink

    “No party has proposed making children responsible for their elderly relatives,nor would that be an acceptable proposal, ”
    but to a considerable extent that is what reclaiming an elderly person’s care costs from their estate does, assuming the children are the beneficiaries. However, if you take seriously the idea that our society’s rules and laws are based on Christian principles, the rules are enforcing the commandment ‘Honour thy father and thy mother that your days may be long’ (and enjoyed in comfort from inherited wealth?). But then, if the children can’t afford the care, or there are none, Acts ch 2 applies, and today the state steps in to ensure that “the believers … sold their possessions and goods and distributed them to all, as any had need.”
    EEyore has retold a parable – in the form of the prodigal father, who has not repented.
    Where does Mr Feckless get this wad of cash for his heirs, after eating, drinking and being merry?
    It’s a complicated world, needing more thought.
    Perhaps a solution is to make a family’s real property (land and buildings owned for the purpose of living therein) an automatic transfer on death to children after the spouse, and levy inheritance tax on all the rest, exempting the home like charitable bequests. The children might have to sell to ensure a fair distribution among themselves, or one of them occupy and pay rent into a family trust?
    They, not the state, could decide that.

    • a-tracy
      Posted May 20, 2017 at 10:22 am | Permalink

      There is a big inequality of housing between the North and South of the UK, people have made excellent gains through luck and the care costs in these locations are a lot higher too.

  8. leavewon
    Posted May 20, 2017 at 7:18 am | Permalink

    The Conservatives should ditch all remainer MPs and the hidden hand remainer bigwigs in the shadows. Stop being so cowardly politically correct in their speech and actions and invite Nige to be their next leader ( without the rest of UKIP )
    All will be well then. (Appreciate JR doesn’t seem terribly keen on Nige, but I can’t see why)

    • Bryan Harris
      Posted May 20, 2017 at 11:13 am | Permalink

      Tories are frightened of competition on the right of centre…..

      Trouble is that if the Tories drift any further left they will start to emulate the failed socialists…. they need to get a grip. By all means take on labours supporters, but what they really need is a sister right of centre party to stop them from going too far to the left…

      Socialism is a failed concept, and we should all avoid emulating it – especially the Tories!!

  9. mickc
    Posted May 20, 2017 at 7:23 am | Permalink

    Mrs May now proposes that the state gets paid twice for providing care…once through NI, then again if one has assets. Naturally she doesn’t propose any reduction in NI or Inheritance Tax so that the individual may accumulate the wealth to look after themselves in later life….

    • percy openshaw
      Posted May 20, 2017 at 7:38 am | Permalink

      Well said. Were the market allowed a free hand in these as in other matters, the state need intervene far less and then – allowing for the “moral hazard” mentioned by another contributor to this thread – on a discretionary basis. Society will never function properly until we respect the market – for upon such respect depends all genuine responsibility for oneself, one’s decisions and dependents.

    • Iain Moore
      Posted May 20, 2017 at 8:04 am | Permalink

      The British establishments desire to be the Santa Claus to the rest of the world has to be paid for by someone , and who better, in their minds, to do it than the despised English, for this death tax is primarily directed at the English. The Scots as we see are to be excluded from this tax like many of the other tax punishments the British establishment have imposed on us. We see the British state happily help fund free Scottish University education, in fact extend this to EU students studying there, but not the hated English. The disparity of the Scots getting free home care was clearly an insufficient bonus for them, so they have added winter fuel payments as well.

      It seems the English are being made to pay, pay and pay again, we fund Scotland Wales and Norther Ireland, but that was insufficient for them, so they had us fund the EU, but that wasn’t enough, so they had us funding the rest of the World with Aid, take that with the tens of billions migrants are sending back to their own countries, it is no wonder England is looking so exploited , trashed and worn out. It seems every last penny is to be wrung out of England so the British establishment can strut around the world acting like their sugar daddy, and if that means stripping them of their assets in their final days, then that works for them.

    • Sir Joe Soap
      Posted May 20, 2017 at 1:14 pm | Permalink

      Yes, this is the side of the coin not tackled by Mr Redwood. Either we pay NI and have a proper insurance for later life, including proper health and care, or we don’t. Governments have pretended that by paying this tax we insure ourselves against these costs, but NI is a misnomer. It isn’t national, as it seems only to apply properly in Scotland, and it isn’t insurance.

      • getahead
        Posted May 20, 2017 at 7:56 pm | Permalink

        Agreed, National Insurance should be that. Insurance against ill health including ill health brought about by old age.

        Children should be allowed to inherit the house in which they were brought up.

  10. A different Simon
    Posted May 20, 2017 at 7:34 am | Permalink

    To answer the question we need to know what proportion of people will need long time/ and full time care .

    If for instance it is 1 in 5 , or less , then the usual answer is a form of insurance ; i.e. the many pay for the losses of the few .

    Annuity pensions are a form of insurance – against outliving ones savings .

    A much greater proportion of an increased National Insurance or other tax would needed to be allocated to cover the costs on an 100% N.I. basis .

    A large part of the problem is that people cannot generate a sufficient savings surplus during their working life due to rentier activity sucking the life out of the economy and HM Govt siding with the vested interests of land lords and banking .

  11. Lifelogic
    Posted May 20, 2017 at 7:36 am | Permalink

    Angela Rayner (Shadow Education Secretary) on Question Time said that having no VAT on private school fees was “a state subsidy” to private education and they would pay the right amount of VAT. What upside down bonkers thinking she uses. Has she had any education in logic or learning to think herself one wonders. Anything beyond her childish spite & envy.

    People using private education already pay four times. Once in normal taxation for everyone else, then in tax and NI on the addition fees they have to earn, then the fees they actually pay themselves, then (if Rayner and socialist Gove had their way) another 20% on top of the fees.

    Why do they not be honest and just say they want a dire state monopoly (and no choice or freedom at all) in education, health and probably housing next?

    • Lifelogic
      Posted May 20, 2017 at 7:43 am | Permalink

      Doubtless Rayner, Corbyne and Gove types will want VAT on private nursing home fees next. This so they pay “the right amount” of VAT and stop getting this “state subsidy”. Then they can have a dire state monopoly there too.

      Why not just have the government running everything form cradle to grave appallingly – it sounds a great idea – what could go wrong?

      • agricola
        Posted May 20, 2017 at 7:24 pm | Permalink

        The time lapse between cradle and grave would steadily erode.

  12. MikeP
    Posted May 20, 2017 at 8:00 am | Permalink

    The Conservative’s proposal has all the risks and ingredients for perpetuating the stress-line between those who work hard, save and build up assets (potentially to pass on to their children) and those who may or may not work but build up no assets so the rest of us have to pick up the bill for any income top-up, housing or care they may require.
    But regardless of who pays for elderly care, there does seem to be a value-for-money issue when figures of £1000-£2000 per week are quoted and we continue to hear of appalling stories of care home abuse and medical failure. It begs the question as to whether you could get equivalent care as a permanent resident on a cruise ship – with the added benefits of good food and year-round weather – rather than going into a care home! Let’s put some focus on sorting out the problems of a fair price and quality before we finalise who pays.

    • zorro
      Posted May 20, 2017 at 5:53 pm | Permalink

      Absolutely! I would recommend it compared to the poor standard of home care often received by pensioners at home at exorbitant cost.

      zorro

  13. ChrisS
    Posted May 20, 2017 at 8:05 am | Permalink

    The one principal has to be that young working families should not be expected to pay increased taxes to fund long term care, just so that better off families can inherit wealth that could have been used to pay for it.

    However, there is another equal unfairness we see now : people who spend everything rather than save, and don’t buy their own home get their care paid for by everyone else, including those same young working families..

    It seems to me that the most cost effective method of paying for care would be through an insurance scheme but one not run by the Government. I have no idea what premiums would cost but they cost less than any other method that could be used to pay for care.

    Perhaps compulsory monthly premiums could be paid from the age of 50 over, say, a fifteen year period until retirement if it were through ill health ? Anyone would have the option of paying a single premium at any time during their life. Basic rate tax relief would be available for everyone.

    The selected insurers would be tasked with providing a benefit sufficient to provide for a basic level of care for everyone in a care home of an agreed specification. As now, anyone would be free to pay extra when they move into care to choose to stay in a better environment.

    The fact that premiums would be compulsory for everyone would make the cost much more affordable.

    An alternative and very clean method of paying for the insurance nationally would be the introduction of an Insurance Premium Tax on every other insurance policy of all types.

    Oh, hold on, hasn’t someone already done that just to fund excessive government spending !

    Perhaps if the government made some real efforts to cut public spending they could use the IPT to pay for my scheme ?

  14. alan jutson
    Posted May 20, 2017 at 8:09 am | Permalink

    Care is rather more complex than the simple outline you describe John.

    The line is very very blurred between social care, medical care, and personal care.

    Having had two parents who needed long term care of very differing types, perhaps you will excuse this potentially lengthy post.

    My father suffered badly from degenerative arthritis at a young age, had two hip replacement operations which were only partly successful (1960’s) replacements, he could no longer work at his original job because of his incapacity, and thus had to do less financially rewarding office work, he became depressed, had a stroke and also developed throat cancer.

    My Mother looked after him at home when he was no longer able to work or walk at all and he slept in a bed in our then front room. he was on a liquid diet as he could not swallow solid food, but he was kept alive simply by my mothers total dedication to his needs, which meant she had also given up work as she was his full time carer which she regarded as her duty.
    After 10 years he gradually became more and more week in which required in effect 24 hour nursing (but no medical care element)
    This constant care with interrupted sleep eventually took its toll on Mum and she had a complete and total nervous breakdown after trying to smother him, before realising what she was doing (my Father was compliant in allowing her to do so and did not struggle) he had also had enough, seeing her falling apart with the strain of looking after him.

    Only at that point (to save my Mums health and to preserve her health) did our local GP make efforts to get my father into a Nursing home of some sort, he qualified for a space at a local nursing home run by Nuns, simply because he was an ex serviceman.
    He died 6 weeks later.

    Did my mother ask for and get any help in the previous 10 years, yes but it was so little and so poor that she deemed it better for both of them to continue herself.
    I of course helped when I could, but was married and living away from my original family home during this period.

    My Mother lived a further 36 years of totally independent life, but after a series of strokes herself when aged 90, the last 6 years were spent 10 months in Hospital and over 5 years in a nursing home under Continuing Care, which is Fully Funded by the NHS because of her absolutely dire condition, only one person in one thousand qualifies for such care and I fought like a Lion to get her that treatment, contesting four medical assessments before the local Chairman of Social Care eventually absolutely agreed with me, and confirmed having seen her and her medical records, that it appeared she had been underscored in her previous assessments.

    During those 6 years because I was an only child, my mothers health and treatment was an absolute priority for me because she had looked after me when I was young and vulnerable, so I felt it was my duty and only fair to look after her in return.

    Did it cause a strain on my time and work, unquestionably yes, and my business suffered to a degree also, but thats life you get on with it.

    The one thing that really really stuck in my gut, when my mother was in hospital and was expected not to survive at first, was when her Consultant at the time, being frustrated with her bed blocking, because I would not agree to their version of her future care plan, asked if she owned her own Home.

    I looked him straight in the eyes and said “what has that got to do with her ongoing treatment and care”.
    I was then granted a meeting with the Chairman of social services, and she was discharged to a nursing home after 7 days.

    So both of the above cases required little Medical care, a bit of Social care but an awful lot of Nursing care.
    Both cases impacted on other members of the family, not just financially, but in medical and stress terms.

    The Country made a contract with people in 1948 for them to pay National Insurance and they in return would make sure they will provide care.

    I have paid into the system for 49 years as has my wife, as have millions of others, and that is why I am so angry at the proposals in you recent Manifesto, that you are proposing and prepared to confiscate anyones wealth who has more than £100,000 which includes the value of the home the family live in.

    The lines as I have outlined above are not clear, can be very confused and complex.

    I agree totally that the system needs to be revised, but it needs to be taken out of politics altogether, it needs cross party and public support and involvement in any decision that is to be taken, but must only be taken when general consensus is agreed, to put such a huge subject in a manifesto pledge with such a simple statement is simply CRASS IGNORANCE.

  15. Cheshire Girl
    Posted May 20, 2017 at 8:16 am | Permalink

    I dont think most people would object to paying for care in their old age, if the Government was not giving so much of taxpayers money away. We are constantly nannied that we must ‘live within our means’ while the Government is promising, pledging, and vowing to keep the Foreign Aid target, no matter what. May I suggest an ’emergency fund’ and then leave the rest to the general public, if they wish to donate more, as they often do.

    A few weeks ago, the Politicians awarded themselves an eleven per cent pay raise, while most people were pegged at one per cent. It seems that everytime one of them goes abroad, they promise extra cash ( Somalia was promised some a week or two ago, when the PM had a meeting with a Somalian official in London). It makes the Politicians look good, as they burnish their halos with our money. It is time that this was stopped.

  16. Jerry
    Posted May 20, 2017 at 8:42 am | Permalink

    “[third] The state – in other words the rest of us – could do so.”

    No that is wrong, it is actually the same as the first option for most people, these people paid all their taxes and Ni HMG asked for, or had them credited as law demands, because they thought that it was a National Insurance – the clue is in the name. This is in effect double taxation.

  17. Denis Cooper
    Posted May 20, 2017 at 8:56 am | Permalink

    As I recall being pointed out in one of the reviews of this matter, the one after Labour had taken power in 1997, the core question is the extent to which the taxpayer should be called upon to protect the inheritances of the children. Therefore one’s attitude to this will be closely connected to one’s attitude towards the taxation of inheritances, and can range from great indignation that there should be any tax at all ever levied on the estates of the deceased or on legacies to Gordon’s Brown’s once expressed belief that after any debts and essential costs have been met the entire residues of all estates should automatically “revert” to the state. After more than two decades of argument over this we as a nation are no closer to any widely agreed position on this, and to be honest personally I’m fed up with it going round and round with far more heat than light being generated. I will just say that if the new policy has the indirect effect of swapping some Tory support in the south east of England for increased Tory support elsewhere in the country, where property prices and owner occupation are lower, then I would see that as being a good thing.

  18. Oggy
    Posted May 20, 2017 at 9:17 am | Permalink

    You ask – ‘How much capital can an elderly person pass on after death ?’ the answer is obvious – all of it ! – as it has already been subject to a lifetime of taxation and NI contributions to pay for (amongst other things) healthcare.
    WHY should it be subjected to taxes for a second time ?

  19. Oggy
    Posted May 20, 2017 at 9:23 am | Permalink

    PS – I see the Scots are going to retain the Winter fuel allowance – no doubt paid for by the English along with Free education, free prescriptions etc etc.
    Can you tell me what exactly is fair about this scenario ?

    • Jane
      Posted May 20, 2017 at 3:04 pm | Permalink

      I lived in Scotland for a year. I have to tell you I have never experienced such cold weather in my life. It went on for weeks at a time. the problem is that English people on the border will feel the policy is unfair.

    • Steve Stubbs
      Posted May 20, 2017 at 6:03 pm | Permalink

      Nothing is fair about this, and if you think about it the shortfall in the NHS and social care budgets could be made up simply by declaring Scotland and Wales to be independent counties and stopping all the subsidies.

      The Scottish budget defecit alone this year is some 15 Billion. Some of that subsidy is being used to pay for the free stuff you outlined. The underwriting is coming from the English tax take and borrowing.

  20. NHSGP
    Posted May 20, 2017 at 9:29 am | Permalink

    Notice what’s missing. Always the case when a politician gives you a choice of A or B. Think about options C, D, E, …

    The key issue is that the population have already paid for the care. The state instead of investing the money spent it. Then to cover up the problem it hides the debts off the books.

    Now the consequences are coming home to roost. It’s not going to keep its side of the bargain.

    If you crunch the numbers, for those just retiring, this is what people could have had in a fund if their money had been invested and not spent by MPs.

    Mr Min Wage – 550K
    Mr Median – 902K
    Mr Average – 1.1 million

    Currently the state offers a pension worth 112K [18.6 years average life expectancy at 65, of 6K of value].

    The state owes 10 trillion for pensions. Off the books, 360K per tax payer. Negative wealth.

    It’s not that the public have been feckless. They have given the money to the state. Their money.

    It’s MPs who have been feckless.

    When they start hiding the debts, its fraud.

    • eeyore
      Posted May 20, 2017 at 5:18 pm | Permalink

      To be fair, I don’t think anyone ever pretended that NI payments would go into an investment fund. It was always pay as you go. As Nye Bevan famously said, “The secret of the National Insurance fund is that there ain’t no fund.”

      JR, as a practical statesman, has identified a real and pressing problem and asks for workable solutions. To moralise at him (as NHSGP does here and I do at the start of this thread) is beside the point. He wants answers, not lectures.

      Mine is, alas yes, it’s too late now to do anything other than throw public money at social care. But when government makes it profitable to be foolish and foolish to be decent, it must accept that citizens will learn the lesson. The small problem of the under-resourced elderly is solved by creating the big problem of a demoralised, dishonest and cynical entire community.

  21. fedupsoutherner
    Posted May 20, 2017 at 9:52 am | Permalink

    Agricola has a very good idea for the money made from fracking – that’s if we could actually get on with it instead of wasting time with giving out subsidies for wind turbines!!

    Also an insurance scheme might help as long as the money wasn’t frittered away on some other useless government scheme. People could pay into a fund which would be scaled according to income and go towards or completely pay for their care when needed. I too don’t see why other people should inherit property while others look after their relatives.

    Even those on benefits could contribute and it could be taken out at source. How many claimants do you see with up to date mobile phones, TV packages, cigarettes, drink, children with up to date Ipads and computer games and tattoos etc???? They could take more responsibility for their old age. How much is a packet of cigarettes these days – £7?

    This could go towards an insurance policy for the future. Why is it always those that work that have to look after the feckless? Make them do something for a change instead of getting state pension and care for free.

    With all the hand outs for people with children now and even more free child care on the table it won’t be long before those of us without children are paying the whole bill!! Trouble is, many parents except it all and don’t want to go without their cars, holidays etc.

  22. Kenneth
    Posted May 20, 2017 at 9:54 am | Permalink

    I am not happy that the BBC is campaigning against the Conservative care plan.

    This kind of political interference by the media may be illegal in an election period

    • Jerry
      Posted May 20, 2017 at 4:35 pm | Permalink

      @Kenneth; Stating the facts is not campaigning against anyone, nor is this limited to the BBC.

  23. JoolsB
    Posted May 20, 2017 at 10:02 am | Permalink

    Thanks to the generosity of the UK Government to all parts of the UK except England, no doubt it will only be the poor suckers in England who will lose everything they possess bar £100k should they ever need care. Ruth Davidson has already said the £300 winter fuel allowance will probably stay for Scottish pensioners.

    It seems it’s one rule for the English and another for everywhere else and our host is part of a government that is perfectly happy to see this discrimination continue against England’s elderly, not to mention their young and their sick.

  24. John
    Posted May 20, 2017 at 10:12 am | Permalink

    We are no longer one coutry, the parliament of the Scots and others are given elderly care for free. The English are again penalised by the British government in order to keep the disunited UK together. Stop usiing my taxes to buy favours from the SNP and give England its own parliament and budget.

    • zorro
      Posted May 20, 2017 at 6:20 pm | Permalink

      It’s disgusting – in this ‘United Kingdom’ our English fathers and mothers are second class citizens in the old age care stakes compared to those who are resident in Scotland……

      zorro

  25. mike fowle
    Posted May 20, 2017 at 10:24 am | Permalink

    I don’t know if you ever look at The Conservative Woman web site, John, but there is a passionate argument from Kathy Gyngell there on this subject. Eeyore makes a good point about moral hazard. Basically the question seems to demonstrate the difficulty in legislating for people with different moral standards.

  26. Antisthenes
    Posted May 20, 2017 at 10:30 am | Permalink

    The welfare state as we practice it is dysfunctional and destabilising and open to wide scale abuse. It is not the concept that is wrong it is how we put it into practice. It has grown from being a simple temporary safety net for those in urgent need into multiple Robin Hood institutions that operate on the principle of bribery and extortion. Because it robs those who have more to give to those who purport to have less it is applauded by the populace as a whole. At the same time it rewards those Robin Hoods who are the most successful at bribery and extortion with power over us. A wholly unhealthy situation that corrupts, feeds greed and is divisive and in the end destroys the society that practices it to the level of excess that we do now.

  27. John Finn
    Posted May 20, 2017 at 10:39 am | Permalink

    The state provides all healthcare free, and provides free places in care homes for those who need them and have little by way of assets or income.

    One thing that’s never been totally clear to me is what is it that defines conditions needing free healthcare as opposed to those which ‘just’ require social care. Let’s take an example

    A man has an accident which results in him becoming paralysed. Clearly the NHS (free healthcare) will be involved initially but, at some point, the man will be discharged/transferred to the social care sector . My understanding was (at one time) that the key trigger for discharge is stability, i.e. the man’s condition is stable which allows Social Care to assess his needs and prescribe an appropriate care package.

    Dementia cases are, for the main part, only ever handled by Social Care. However, Dementia is not a stable condition. It causes severe deterioration and may eventually require nursing care.

  28. acorn
    Posted May 20, 2017 at 10:45 am | Permalink

    Interesting infographic of an ageing planet. Remember, the government will not run out of its own money to pay pensions or for health and social care. The government’s problem will be, will there be enough goods and services available to buy, at the prices the government is prepared to pay?

    Will the economy have grown enough and increased its productivity enough, to supply all the citizen needs, from a relatively smaller working age population? http://www.helpage.org/global-agewatch/population-ageing-data/infographic-index-at-a-glance/

  29. Beecee
    Posted May 20, 2017 at 10:46 am | Permalink

    What the elderly Scots get for free due to devolved government and funded by the English Taxpayer, they will in future continue to benefit on the backs of the elderly English pensioner and their heirs.

    The hypocrisy and mistreatment of the English continues

  30. Bert Young
    Posted May 20, 2017 at 10:54 am | Permalink

    Theresa has linked the value of a house and the cost of care for the elderly . I do not believe it is the way to go . An ageing and increasing population is inevitable and the link to the economy equally so . Relating the paying of care to a £100,000 value house is ridiculous ; there are few properties with a value below this figure so its just another ploy for the older generation to cough up . During one’s working life everyone plans for the future and the present , ample opportunities exist during this period for funding for the inevitable to occur .

    There is much abuse in the disposition of the revenue collected for the cost of health and the cost of elderly care to be included without imposing a further burden on the individual ; overseas aid is one such case ; the size and cost of the public sector is another . Any Chancellor does not have to look elsewhere . Like buying a car – there is such a wide option available it is possible to select something that falls within the scope of income and cost .

  31. Bryan Harris
    Posted May 20, 2017 at 11:08 am | Permalink

    What is missing in all of this is community spirit and a sense of responsibility.

    When families lived together, with often several generations in the same house, families took care of their own. We have moved away so far from this concept and it is one of the reasons we are failing as a country.

    We need more community spirit – NOT CHARITY. We need a way for a community to support those in need to provide basic help and support to those that are physically unable.

    What can the government do about this?

    1. Redesign town centres so that it is not all about shopping, but a place where people can come together… perhaps with community run tea rooms or other facilities but almost free of cost – any buildings that will encourage collaboration of people who might otherwise be bored with life and have time on their hands.

    2. Encourage old people to support the young with community projects and get the generations talking together.

    3. Find ways for the old to get back into schools – have kids teach them higher maths… whatever – have the old tell tales and show off their life experiences.

    It’s all about encouraging people to be people and not isolated individuals lost in a crowd of other isolated individuals.

  32. Oggy
    Posted May 20, 2017 at 11:15 am | Permalink

    Social care should be paid for by cutting the hideous Foreign Aid budget by 75%, after all charity begins at home. Any change should be shared equally between the NHS and schools.

  33. Ian Heath
    Posted May 20, 2017 at 11:21 am | Permalink

    My friend, who’s wife has dementia and moving into residential care, is in despair. He now thinks that his estate will be reduced £100,000 and that he will have to sell his home when his wife dies. Please confirm that (a) the situation on his estate has not worsened, and that (b) he will not have to sell his home on the decease of his wife, i.e. that the untaxed inheritance of estate by a surviving spouse is not affected and that the care costs need not be repaid until the surviving spouse dies, at which point his estate will be able to retain a minimum of £100,000 (or should it be 2 X £100,000?).

    • Denis Cooper
      Posted May 21, 2017 at 4:02 pm | Permalink

      Tory spokesmen on TV say he will be OK, but they do not openly contradict and expose Tim Farron who says “They will be coming for you”:

      http://news.sky.com/story/tory-social-care-plans-theresa-mays-poll-tax-warns-tim-farron-10886756

      “Speaking to the Sophy Ridge on Sunday programme, Mr Farron said it showed the Conservative leadership is “mean, calculating, and uncaring” and taking voters for granted.

      He drew parallels with the poll tax controversy that forced Margaret Thatcher from office, and also warned: “If you or your loved one has or will get dementia, they are coming for you.””

      I don’t understand why the Tories can’t be bothered to defend themselves.

  34. Michael
    Posted May 20, 2017 at 11:26 am | Permalink

    Apparently if one becomes ill the state will pay for care but dementia is not classed as an illness. Perhaps that distinction needs reviewing?

  35. Steve Stubbs
    Posted May 20, 2017 at 11:28 am | Permalink

    As one whose medical record would suggest I am likely to end up in care sooner than later (say within the next seven years) I have already emailed my five children to ask them would they rather let the state take their inheritance, or should I capitalise my assets now (sell house and rent flat, or think about equity release) and spend the assets/cash I saved throughout my life over the next few years having a great time and visiting all those places in the world I have wanted to but through prudence never have.

    Seems in either case they loose out by only getting around one fifth of the residue each, after funeral costs, death taxes (probate fees) and grasping lawyers.

  36. Jane
    Posted May 20, 2017 at 3:33 pm | Permalink

    A very difficult subject. I am retired and am most happy to give up my fuel allowance (a bribe by Gordon Brown) and the silly £10 Christmas bonus should also be axed.

    I am of an age where I was brought up to take personal responsibility for my health and well being. this concept is alien to many younger people who think it is the States (citizens ) responsibility to provide for everything. I was most happy to pay my taxes for the common good for those less fortunate citizens who fell on hard times. This view has been sorely challenged in the past 20 years when the notion that it was OK to have lots of children and live on welfare benefits. Fortunately, Iain Duncan Smith believed in work and the stringent rules re job seekers allowance has ensured that people have to find work and are penalised if they fail to try. That is why unemployment has fallen in my opinion and having helped in a food bank the reason for their use as many people did not follow Job Centre instructions and benefits were suspended.

    Social care is not something I have thought about much. I am old but still fit and healthy and look after a partner, neighbour and other family members who need support. Recently, a family member who is widowed was assessed for PIPs to cover her social care which she receives at home. The process was excellent, sensitively dealt with and PIPs covers her care, gardening etc. She is not using any of her own money.

    As others have said we all know those who are feckless and who have lived the good life whilst others like myself saved and prepared for retirement. Governments over the years have tried very hard to inculcate the need to save to ensure older people are protected. Most of my friends believe in personal responsibility and are happy to fund their care. Some do intend looking at legal measures to protect their assets too. I am angry at how many years it has taken for some action on social care. Successive governments have failed to tackle the issue even though all of us have known for many years that it was a time bomb as people lived longer and as a result became more likely to require care with illnesses associated with age. The ONS has produced figures which are alarming when by 2030 the number of retired people some 30m will be greater than those under aged 25. Back to the current proposals and I am not sure the policy is quite right – I would have liked guidance on insurance cover which may of course occur once the policy is thrashed out and many views and experts opinions taken into account. The principles are right – they are conservative re individualism with collectivism coming into force when it is necessary. When national insurance started it was not expected to cost the State a lot – we pay in and we get out. That model from the last century can no longer be valid. Society is changing, people getting older, both parents working, families not able to care for each other , expectations sky high etc etc. It is honestly time that we started reviewing what the State provides and what the citizen should contribute. A starting point in the NHS . Having lived in other countries it is poor. Paying for some services is inevitable and I just wish those we elected would be braver. Well done Theresa May. The first PM for decades to try and do the right thing knowing that it will upset many.

    • Know-Dice
      Posted May 21, 2017 at 7:04 am | Permalink

      Jane, an interesting post to which I don’t fully agree…whilst something dramatic does need to be done about care for the elderly, now was not the time.

      Mrs May was truly stupid to put this policy in her manifesto, a truly open goal for Labour…

      • Denis Cooper
        Posted May 21, 2017 at 3:55 pm | Permalink

        Arguably now is the time, because the Tories can afford to lose some support over this, will still win the election, and can then start to do things which are absolutely necessary but have been too frightening for all the main parties to propose when pre-election opinion polls have been closer. Of course it is possible that Theresa May has miscalculated and will lose so much support that Labour will win, but that seems unlikely.

  37. Spratt
    Posted May 20, 2017 at 7:54 pm | Permalink

    The real problem is classifying dementia as a social care need. Mrs May would potentially win some friends if she were to announce that the care of those with dementia would be at least jointly funded by the NHS and social services through an integrated budget so that – at most – sufferers would only be charged for half the costs.

  38. Pragmatist
    Posted May 20, 2017 at 9:17 pm | Permalink

    Thr Tories should be congratulated for condemning 30-40% of the population who smoke openly and secretly into getting even more implicated in buying illegal tobacco products. Has Amber Rudd initiated progressive interaction between the Poice Forces with the criminal fraternity to get a cut for the Exchequer in exchange for idemnity from prosecution? If not, she should work more smartly, not difficult really. The money lost in taxes could have been used for finding the real reasons for cancer. Now, we may never know.

  39. Steve
    Posted May 20, 2017 at 9:55 pm | Permalink

    I’m in a similar situation to Ian Heath above. My wife has needed care for several years already, having become incapacitated in middle age, but has ill-health pension sufficient to cover her contributions under the current regime (having burned most of her savings). With joint ownership of the house thrown into the pot, the full cost will kick back in.

    I’m now approaching the age I’d planned for retirement on a modest income, and these proposals worry me as there’s no way that our combined income would be able to cover the full cost, and this would essentially require re-mortgaging the house. How would that work if, as is likely, I survive her? And then what if I re-marry and eventually leave a widow (even assuming negligible care needs)?

  40. Monty
    Posted May 20, 2017 at 10:59 pm | Permalink

    The first generation who got away with a deliberate decision to choose idleness and parasitism as a lifestyle choice, are about to enter the ranks of the “retired”. That’s a laugh. I was grafting while they were malingering, as far back as 1970. I used to catch a bus at four in the morning, to get me to Parsons on the Fosse Way on Tyneside so I could be ready to do my waitressing job in the staff canteen. Under the supervision of the redoubtable Mrs Knibbs, a seriously magnificent cook.
    Some of them, the low lives, I know their names. They have never done a hand’s turn in their entire lives.

    They have leached off the welfare state all their lives. Why should their entitlement to care now be the same as mine? I have been a net contributor, by a large margin, every year of my life for almost half a century. They have contributed nothing, ever. Their only means of raiding my purse yet again, is through Parliament.

    These people never cared about me, or you for that matter.

    There is no nice way of saying this. But I see no reason their entitlement should equal mine.
    Why not shunt them into a Unit. In which their food, water, accommodation is assured, but nothing else is. Etc ed

  41. cornishstu
    Posted May 20, 2017 at 11:00 pm | Permalink

    Seems to me May and her Tories want a bit more than just a mandate for a strong brexit knowing full well to vote for any other party will cost those of us who work hard take responsibility for ourselves standing on our own feet will be shafted more so. Time for direct democracy I think, the only way to stop the establishment making free with our money.

  42. Lindsay McDougall
    Posted May 21, 2017 at 1:05 am | Permalink

    I want you to answer the most important question about health care that neither Mrs May nor you has attempted to answer:

    How are ‘generation rent’, who own no house and have little prospect of getting one, to finance their health care later on when they are elderly. For most of them, when they have to stop working, they will rapidly become paupers.

    I want you to address this issue seriously.

    I have a remedy, which is to get house prices to crash relative to incomes by at least 30%. This can be done by raising interest rates and curtailing immigration to zero, thus drastically reducing the demand for housing in the UK. We are not responsible for looking after every Tom, Dick, Harry and Harriette from every part of the globe, and entry to the UK is not an entitlement (George Osborne, please note). Our own young people come first.

  43. Iain Gill
    Posted May 21, 2017 at 5:21 am | Permalink

    The problem is you are discouraging saving, penalising the prudent, encouraging sneaky work arounds like trust funds or giving to your children earlier in life, and generally putting all the wrong incentives in the system.
    Most dramatic for instance where a family has, for instance, rebuilt a house from a shell, and you take it off them when the father dies. Why did they work all the long weekends and holidays doing that when they could have been feckless and ended up no worse off.

  44. Retired
    Posted May 21, 2017 at 9:22 am | Permalink

    Mrs May has graciously allowed anyone living in a house with a value of less than £100,000 to keep their home without any deduction towards care home fees.The average cost of a UK home is around £218,000.There are few areas in the UK where one can purchase a home for under £100,000.The obvious intent is to punish most people who own a home to pay for their own care.In addition to that she now plans to abandon the pensioners ‘triple lock’ scheme and take away their winter fuel benefit – unless of course you live in Scotland where pensioners will still receive it.Apparently houses are colder in Scotland!
    The pensioner vote is worth around ten million votes – watch this space!!

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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