Would you pay more tax to increase spending on services including social care?
- No, taxes are too high already - the government needs to be more efficient. (31%, 878 Votes)
- Yes, we need more funding. (26%, 725 Votes)
- No, taxes should only rise on the wealthiest. (25%, 707 Votes)
- Yes, but I would only pay a social care-dedicated tax (18%, 490 Votes)
Total Voters: 2,800
Loading ...The government has scrapped the planned cap on care costs to help tackle a black hole in the public finances it claimed was left by the Conservatives.
Chancellor Rachel Reeves announced today that the adult social care charging reforms, due to be implemented in October 2025, would be cancelled, saving £1.1bn by the end of 2025-26.
This is despite the Labour Party indicating it would implement the reforms during the election campaign.
The move was roundly condemned by the architect of the reforms – economist Sir Andrew Dilnot – and older people’s charities, though council leaders stressed they would not have been able to implement the changes next October.
‘Unfunded commitment after unfunded commitment’
Reeves made the announcement in a statement to the House of Commons on Labour’s spending inheritance from its Conservative predecessor.
Reeves claimed that the government as a whole was due to overspend budgets by £21.9bn by the end of 2024-25 because the Tories had made “unfunded commitment after unfunded commitment, knowing that the money was not there”.
The unfunded spending pressures cover the asylum system, health, rail services and aid to Ukraine.
However, just under half – £9.4bn – is the result of a decision Labour has taken to accept the recommendations of the independent pay review bodies for various public servants, including NHS staff, teachers and police officers.
This is because the bodies had proposed rises of 5-6%, well above the 2% baked into the government’s accounts at the last major review of spending, in 2021.
Multiply delayed reforms
Reeves’s statement seemingly sounds the death knell for a reform agenda conceived thirteen years ago by an independent commission – led by economist Sir Andrew Dilnot.
They were put into law through the Care Act 2014, then had their implementation delayed from 2016 until 2020 and were subsequently scrapped by Theresa May’s government, in 2017.
What social care charging reforms consist of
- Putting an £86,000 cap on people’s lifetime liabilities for their personal care, based on how much the person’s council would – or does – pay for meeting these needs, except where the person is receiving means-tested support, in which case only their individual contributions count towards the cap.
- Implementing section 18(3) of the Care Act 2014, enabling self-funders to request that their council arrange a care home placement for them, meaning they can benefit from the typically lower rates councils pay for care, compared with private payers (the so-called ‘self-funder subsidy’). This would ensure that the costs that count towards the cap are those that the person actually pays.
- Funding councils to pay providers a ‘fair cost of care’, to avoid the implementation of section 18(3) and the removal of the self-funder subsidy making providers unsustainable.
- Raising the upper capital threshold, above which people are charged for their care, from £23,500 to £100,000, allowing many more people to claim state-funded support. The lower capital threshold, below which people make no contribution to their care from their assets, would rise from £14,250 to £20,000. Both thresholds have been frozen since 2010.
Boris Johnson’s administration then revived the plan in 2021 before delaying their planned start date from 2023 to 2025 after lobbying by council leaders that they would be unable to implement the changes.
At the same time, they rerouted £3.14bn in funding over three years from the charging reforms to bolstering councils’ day-to-day adult social care budgets.
What Labour said during election campaign
During the election campaign, the Conservatives pledged to implement the changes, as planned, in October, though think-tank the Institute for Fiscal Studies (IFS) pointed out that no funding had been allocated to doing so.
Labour indicated that it would also implement the changes, with the now health and social care secretary Wes Streeting saying that he was “committed” to the changes and wanted to give the sector the “certainty and stability” of knowing that what had been planned would take place.
However, in a document to accompany the statement, the Treasury said that the Conservatives had committed to introducing the adult social care charging reforms in October 2025 “but did not put money aside for them”.
Reforms ‘now impossible to deliver’
“The reforms are now impossible to deliver in full to previously announced timeframes,” it added.
The decision to cancel the reforms will save £30m in 2024-25 and £1.075bn in 2025-26, the document said.
Shadow chancellor Jeremy Hunt, Reeves’s predecessor as steward of the country’s finances, said that Reeves’s argument “was not credible”.
“Those public finances were audited by the OBR [Office for Budget Responsibility] just 10 weeks before the election was called. We are now expected to believe that, in that short period, a £20 billion black hole has magically emerged,” Hunt added.
Review of government spending
Reeves also announced how decisions on government spending would be determined in future.
On 30 October, she will deliver a Budget, confirming final spending totals for 2024-25 and levels for 2025-26, including relating to central government spending on local authorities and how much councils are able to raise locally through council tax.
She also announced she had started the process for a three-year spending review, covering 2026-29, which will conclude in spring 2025.
In response to this announcement, the Local Government Association (LGA) said the review needed to address pressures on councils that it had estimated as being worth £6.2bn from 2025-27.
Social care costs ‘pushing councils to the brink’
“Right now, councils are being pushed to the brink with rising adult social care costs, children’s placements and temporary accommodation,” said Pete Marland, the chair of the LGA’s economy and resources board.
“Any further funding reductions in the years ahead would be an unthinkable prospect with councils of all types already struggling to protect the services which bind our communities together and protect our most vulnerable from cutbacks.”
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This downturn is absolutely disgusting, he we go again making the elderly suffer for paying their taxes all their working lives yet shafted if they dare live long enough to require social care. When is any government going to sort out this unfair unjust treatment of the elderly.
This particularly impacts on people living with dementia who will not meet the criteria for NHS Continuing Health Care Funding in its current form, but are unable to live independently because of the disease. As you say, these are people have worked all their lives and paid their dues and yet, because they have dementia are discriminated against.
I totally agree my mum has just been diagnosed with dementia however any care I need to arrange my mum has to pay as she is over the limit with her money but if she ended up in a care home all that money been gone in a year – unbelievable
Absolutely , it is a disaster. It is the reckless approach from the last government.
My parents separated as a teenager. The adult social care started giving us trouble .
She was forced to go a nursing home in
2015, she can’t come home, the solicitor said in 2016, she should stay in the nursing home .
I have diagnoses of dyspraxia, ADHD and Aspergers traits ( I had a nervous breakdown to get my ADHD detected).
If I did not mess up , 6 years ago , I would not have my ADHD detected , my mother’s house would be sold , as a result of only having 2 diagnoses. I am “protected” as a result of my 3 diagnoses. I am not being treated as a dependent. I am self employed, I can’t find housing in my area , too much demand , not enough housing, too expensive, I will not live with my father, I will not live in emergency accommodation in another town or relocate to northern England.
This affects families. There is harassment, intimidation.
Adult social care sucks . It needs reform badly .
Not only dementia people are discriminated against. I am 92 years of age. I live alone. I have had to self fund 4 carers for one hour each every day. CHC funding seems to be out of the question because i am not ill – simply disabled. My husband and i both worked and paid all our taxes on the promise that we would be looked after -CRADLE TO GRAVE. I was 16 years old and i remember! my husband cost the government nothing because i was his only carer until he died with cancer. I have paid approximately £86000 already and was hoping 2025 would give me some relief. Fool that i am, I have never trusted any government before, i did have great hopes of a care cap. Silly me!!!
Not just the elderly. I have progressive multiple sclerosis and live alone. My care needs are feeding washing and living
Yes Fair comment Linda Barnes
Same shxt.
Different day.
Cheeks of the same backside continuing were the previous cheek left off.
Here’s an idea ? Stop supporting unjust wars and follow the swedes and Netherlands in looking after their people first!!!
The reality is that no government will ever sort this out simply because it costs too much. I don’t know why anyone would be surprised by this announcement. We have to change the narrative; in the main, if care is needed, it will have to be paid for. The government – any government- should change its focus away from pretending to be searching for the answer towards trying to create the financial environment to help people raise their own funds in collaboration with the private sector and use of the tax system. Been saying it for years.
Well said, MOC. In addition, we are increasingly experiencing the unavoidable effects of demographic decline i.e. an expensively ageing society funded by an ever decreasing tax base as well as a decreasing resource of available hands-on carers whether from relatives or paid staff.
A wild idea probably but perhaps the main reason why care costs are so high is because most providers are private hedge funds which prioritise dividend payments and debt repayments. Tax breaks help too of course. It certainly isn’t the pay of staff majority of who aren’t paid the living wage rate. I’m old enough to remember when the majority of care provision was local authority provided staffed mainly by people who actually lived locally.
Successive Governments will just keep kicking the can down the road
They all know its a massive problem but just keep burying their heads in the sand & hope it will go away
You must know that will never happen right?
Not surprised at all.
There is no way at all the LA I work for, or the neighbouring LA, would be able to implement this ‘cap’ properly or fairly. We would need a lot more social workers, and finance assessment staff, and a lot lot more funding.
We are 1. Not able to properly pay the workers we have, 2. Already not able to recruit the workers we need and 3. Now being asked to prepare for job cuts.
Anyone working in the sector has known for years that the care cap is a pipe dream that to be honest mocks the state the public sector is in.
Additionally it’s nowhere near the saving Grace you’d think it to be. To those saying their loved ones with dementia will be discriminated against- they only ever would have metered towards the ‘care cap’ at the cost of their own contribution (NOT what the care actually costs). Or if you organise it yourself- only at the cost of the cheapest the council could have found it for (NOT what the care actually costs).
If you receive home care and pay say £100 a week towards it – it would take you 16.5 years to reach the cap!
The cap would have benefited those with lifelong conditions, but for anything old age related or later life, would not have. And it would have bankrupted every council, leaving nobody with adequate service.
Our waiting lists are so long that it frightens me to imagine what it would be like if this cap had come in.
Anyone who feels this could have been achievable is heavily, heavily blinkered and unaware as to the true state of social care.
I’m sorry, you’re wrong there – this would have certainly benefited my mother (and others like her who need increased care in old age) if it had come in – especially last year as planned, she’s frail, with dementia and various conditions but still quite “well” and likely to live for some years now she is in a good local care home where she is safe, comfortable and settled. She had to move there after breaking her arm at home. There is no one who can afford to pay top up fees when all of her capital is gone. Had the cap and increased threshold come in, we could have used her remaining capital to top up. Those who need care that costs much more than their income, but that don’t have vast wealth, would have been in a much better position to eke out what they do have. Now I’m really terrified of what happens to my mother when her savings run out, as they will within two years.
I agree, I work in a local authroity and we simply could not afford it nor, do we have the work force to carry out the 1000s of extra assesments etc. It was a terrible idea in the first place.
Across thirty years , the cost of care and the political kicking it back and forth has not stopped .
We know what the date is saying about people living longer and often sadly with increased risk to disease .
The gift of progress should be welcomed and we should have proper and realistic plans to provide support where it is needed.
I get the points made here , but where would the money come from as we dont seem to be able to get those that should pay more to do so .
I think changing the council tax banding would be a good place to start and should raise more money for local councils . It does not seem right that I pay the same CT as someone who owns a very expensive property who has the means to pay a fair amount .
We could also look at baking in early on a personal fund for social care but—— thats a slippy slope.
I left a job a few weeks ago and started a new one and got paid two amounts of money and paid over a thousand pounds in tax . I will not be on my own here > what are they doing with all of the money paid in ?
I have been paying my mother’s care home fees currently £1,100 a week for almost 3 years now . Apart from her dementia she is well , so I could be paying this amount for some years to come , I envisage the possibility of paying £400,000 plus during her lifetime for care !!
Have you looked at a care fees annuity?
I am disgusted with this U-turn on government policy. As this heavily penalises the hard working lower class that save all of their lives and who don’t squander their money, on holidays, cars, booze and cigarettes. This gives the message to the lower classes not to save and to squander every penny they earn. Then if you get ill and need to be in a nursing home etc, you get it for free if you stay under the very low thresholds. This effects the only the slightly affluent lower working classes and won’t worry the rich middle and upper classes. Its’ disgusting how each Governments easily find money for weapons, bombs and the like but looking after hard working lower classes is not a priority.
You were warned about Labour before the election. They will now give more money to dropouts lazy sods that can’t be bothered to work and worst of all the bloated public sector. Sod the pensioners and anyone who has a bit of savings. MPs do not have a clue about the real world. You thought the Conservatives were bad you ain’t seen nothing yet.
I agree with all of the above and in the next 4 years Labour will crucify this country. They have no compassion for the elderly and for the people who have worked hard during their life time. The elderly may have saved a few pennies for their retirements but hey ! the government want to take that as well. We have not moved forwards in terms of living the good life. We are supposedly one of the richest nations yet here we are with people struggling to buy food and heat their homes. What on earth has gone wrong.
James C
This government was committed to the cap prior to the election and, now elected, has dropped its promise. Cannot be trusted, liike any other government. What next ??
why is it that u could live in a council /housing association accommodation / private housing most of your life and be partly funded if going in a home yet if u own your own house u have to use that money / how is that fair / never has been / doesn’t happen in Scotland ! –
Because paying rent doesn’t buy you an asset, owning your home generally is an asset that appreciates in value over time. At least that’s what politicians think. That’s why they’ve handed over care services to private equity hedge funds prioritising dividend payments over fees charged. The same companies which also avoid paying full UK tax by basing themselves in overseas tax heavens knowing that if it came to it the government of the day will bail them out.
It’s really sad to see people suffer when they worked all there lives and paid taxes didn’t go on holidays or spent there money wastefully and when they have an accident or are terminally ill with diseases or just gone into old age and have no family member to lookafter them it’s not fair on these people the government need to make a new policy towards social care
My dad worked so hard all his life and was proud that us daughters would inherit his home when he passed. My mum has dementia and will soon be in a home and our inheritance (family home) will pay for her care home fees-what is the point of working hard? if no money/property she would get free care?Seems better to have nothing in the pot 😥 The system is all wrong and now the cap has been scrapped 😡😥 my dad would be turning in his grave
The best things to do in this world, is don’t work, live on benefits and then you get everything paid for by the state and get extra payments for winter fuel and care home fees. No wonder there are so many people unemployed and don’t want to work, they have got it made. I am so disappointed in this new labour government, I always thought they were for the working man and have backed them all my life. What about the wealthy when are they going to help the economy?
Please don’t tar all unemployed people with the same brush. Whilst there are some who may not want to work, there are those who were working their whole lives, paying taxes and now cannot do so. I am one of those people. I loved my job but lost it through no fault of my own in the blink of an eye and yes, I am now in receipt of benefits, for which I am eternally grateful. It’s sad to hear the way the unemployed are talked about. I apparently have gone from being an upstanding member of society to the dregs. There are many issues at play here, do not target ALL the unemployed, many of us have lost more than you’ll ever understand.
The problem with elderly care is it is a heavily weighted political hot potato. I can’t offer any solutions.
Everybody was warned about Labour, but of course nobody wanted to vote Reform UK, as they did not want to be seen to be racist. Well it’s not racist to put the decent hard-working Brits (not the lazy sods) first, and then extend the hand to others who need it (i.e. Asylum & Refugees). Why are we funding hotels at a cost of billions to the tax-payer, and why not speed up asylum seeker applications, and not have people left for years in limbo? I am a British born ethnic minority, who is hard-working, and when I was growing up, it was the immigrants to this country who were hard-working, and helped to make it what it is today. I would also say the Government needs to make menial jobs pay, and pay a salary that people can live on, and make people work for the dole. It’s not rocket science.
This doesn’t surprise me, and the previous government’s postponements struck me as as precursor to it being scrapped anyway.
I recommend that married couples arrange with a solicitor to be made tenants in common for their house. That way if one partner dies and the surviving partner needs to self finance care, the deceased partner’s estate still goes to the beneficiaries in the will.
I have no children to inherit my house, so at some point during early-to-mid retirement, I will also be looking to cash in some of the equity on my house. I might as well enjoy the money and let the council foot the bill. Not very altruistic, but that is how things have become.
I’m sorry but care is not free.
In the past, families used to look full-time after their ageing family members. In many countries that’s still the case. If someone has the financial means to pay for their own care and support, why wouldn’t that be appropriate? The state and taxpayers can’t afford providing care to everyone.
And for anyone who says “so and so paid their taxes”, I’d seriously wonder how many paid upwards of £400k of taxes within their lifetime, excluding the portion of their taxes that would have gone to the NHS, education, infrastructure, police, etc.
I know that children see their inheritance fade in front of their eyes, but honestly – sorry, that money was never yours.
Everything is back to front in this country. Forensic mental health service users get their rehabilitation and integration back into the community paid for by LA funding and paid maximum benefits for many to end up back in prison or secure mental health units. Our elderly, once infirm physically and or mentally by no fault of their own, unlike the for-mentioned, get little if any dignity, support and compromised care and funding in their final years….where’s the fairness??