Publication of a white paper on paying for the care of the elderly is being held up by the Treasury, according to a senior Labour Party source.
Former health minister Lord Warner, who has been deeply critical of Gordon Brown's Personal Care at Home Bill, said he keeps hearing "whispers" that the Treasury is reluctant to commit to extra public expenditure ahead of the Budget or a Comprehensive Spending Review because of "real problems" over money.
The end result may be that if the government wants to honour its promises of a white paper before a dissolution of Parliament it may well not include any details of how much the state will pump into the new system.
Former health minister Lord Warner, who has been deeply critical of Gordon Brown's Personal Care at Home Bill, said he keeps hearing "whispers" that the Treasury is reluctant to commit to extra public expenditure ahead of the Budget or a Comprehensive Spending Review because of "real problems" over money.
The end result may be that if the government wants to honour its promises of a white paper before a dissolution of Parliament it may well not include any details of how much the state will pump into the new system.
Now of course the government denies this and insists a full white paper will be out soon (most people believe around March 23 to 24), but what he says does make some sense, especially with every department facing cautious spending commitments from a Treasury increasingly playing "hard-ball" over public finances.
Warner, who was a health minister under Tony Blair, said: "Even if you collect a lot more money through social insurance you still probably will have some sort of state underwriting of the very expensive cases where people have long periods where they need expensive social care.
"It's unlikely that an insurance system will cope well with the extreme cases of expenditure so you are likely to need some form of state underpinning and it takes a long time to model these systems to find out what the true cost is."
He added: "I can conceive of them producing a document, which they may or may not call a white paper, which is a direction of travel white paper document but I can't see it being something which has much in the way of figures and is therefore highly suspect."
Whether or not the paper says much in the way of finance, it is likely to indicate the government's preference for a compulsory levy to fund social care paid through one of three means.
People who delayed their retirement for three or more years would see the money they would have received in the form of a pension transferred to the National Care Service.
A second option would be to make regular monthly payments to the National Care Service on retirement.
Anyone who had not already paid money towards the service would have their estates automatically taxed on their death, possibly at a rate of around 10%.
So we await the end of March with interest.
Warner, who was a health minister under Tony Blair, said: "Even if you collect a lot more money through social insurance you still probably will have some sort of state underwriting of the very expensive cases where people have long periods where they need expensive social care.
"It's unlikely that an insurance system will cope well with the extreme cases of expenditure so you are likely to need some form of state underpinning and it takes a long time to model these systems to find out what the true cost is."
He added: "I can conceive of them producing a document, which they may or may not call a white paper, which is a direction of travel white paper document but I can't see it being something which has much in the way of figures and is therefore highly suspect."
Whether or not the paper says much in the way of finance, it is likely to indicate the government's preference for a compulsory levy to fund social care paid through one of three means.
People who delayed their retirement for three or more years would see the money they would have received in the form of a pension transferred to the National Care Service.
A second option would be to make regular monthly payments to the National Care Service on retirement.
Anyone who had not already paid money towards the service would have their estates automatically taxed on their death, possibly at a rate of around 10%.
So we await the end of March with interest.
Leave a comment