From the TUC

Three approaches to social care: What are the parties’ #GE2017 plans?

18 May 2017, by in Public services

Now the Conservative party have published their manifesto we are in a position to look at the approach of each major party to funding social care in England.


The Conservative policy is abandon the Dilnot reforms the party committed to in the 2015 manifesto. Originally Dilnot set a ceiling on what a person could pay for care (recommended at £35,000 but set at £70,000 by the government) after which the state steps in to cover the rest. The Conservative policy replaces this ceiling with a floor. The individual is liable for all their costs, unless and until they have financial resources worth no more than £100,000. Below this threshold the state will step in and cover costs. This £100,000 includes the value of their house. They would also increase the scope of the deferred payment scheme to cover domiciliary (home-based) care, meaning that more people would be able to pay these costs after their care needs end, or their families will after their death.


What does this mean?

On the positive side, raising the financial resources threshold from £23,000 to £100,000 is an improvement. The measure is progressive: people with more financial resources will have to pay more than people with less before the state takes over.

But this is outweighed by key downsides. The £100,000 threshold now includes the value of the home, meaning it is much easier to fall outside it than it might initially appear.

The extension of deferred payment allows more flexibility. However, in the case of elderly care, it effectively pushes the costs on to the next generation, who may have to pay out a large amount of any inheritance on the death of a relative (which is the most common reason why older people stop needing long-term care). As such it appears like an inheritance tax, but where the Inheritance Tax targeted those fortunate enough to receive a high value asset or a large sum of money; this targets those unfortunate enough to have a parent who had substantial care needs and fairly moderate assets.

This policy effectively reverses the most significant changes in the Dilnot proposals. Dilnot collectivised the risks inherent in funding a service when the user doesn’t know how long they will need it for. Up to a certain level the individual would pay, then the tax payer steps in and covers the rest. This had the added advantage, that it addressed the market failure in social care: knowing that their essentials would still be covered, individuals are more likely to pay for additional services which drives innovation and investment from providers. The Conservative model re-individualises the costs and risks of social care, and reinstates this market failure.


On Monday the Conservatives announced that under their scheme no-one would have to pay more than a fixed amount for their care. The precise amount will be set after the election in the event of a Conservative victory.

This effectively reintroduces the regressive element of the Dilnot reforms discussed in more detail below. As ever, the devil will be in the detail, and that may have to wait till after the election. While a cap reintroduces the pooling of risk for funding social care, the level of the cap will be crucial in determining exactly how beneficial that will be. And that remains to be seen.

Liberal Democrats

The Liberal Democrats would introduce an additional 1p charge to basic rate, higher rate and additional income tax. This would generate an additional £6bn which would go towards health and social care. This would eventually be replaced by a dedicated health and social care tax. They would implement Dilnot’s cap on the costs for social care. They would move towards an unified system with place-based budgets giving local authorities greater control over the health and social care services provided; and establish an independent body, equivalent to the Office of Budgetary Responsibility for health and social care.

What does this mean?

Health and social care would receive more funding, and there are moves to place this on a more permanent footing through a specific health and social care tax. Health and social care in the UK would also benefit from greater cohesion which is something the TUC has called for in the past.

However it leaves a number of the problems with Dilnot unaddressed. Social care is still largely left to the private sector with all the associated risks of deleterious cost-cutting and poor working conditions. Dilnot is also regressive: because everyone pays the same, people with more financial resources will pay proportionately less for their care than those with fewer resources.  It does little to help those who struggle with debts already and so would struggle to cover costs well below the level of the cap.

I wrote a blog discussing the limitations of the Dilnot proposals here, and at the time my former colleague Richard Exell wrote an excellent summary, here.


The Labour party are proposing an additional £8bn of funding for social care over the course of the next parliament. They also propose national adoption of the Ethical Care Charter – which would scrap 15 minute visits, pay carers for travel time, provide access to training and give every carer the option of regular hours.

In the long run the Labour Party are calling for the establishment of a National Care Service. They have a number of options for paying for this, either through employer contribution, through an additional wealth tax or a specific social care levy.

What does this mean?

A National Care Service would address many of the flaws in the Dilnot proposals. In 2014 the Barker review provided a useful blueprint for implementation.

The Barker Review

In 2014 the Barker Review recommended a new settlement for health and social care in the England. This would remove the ring fence between health and social care funding and place them both under a single commissioner. It would then employ the four existing bands of support used by local authorities to assess the level of entitlement. Those whose need was defined as critical would receive free social care. As the economy improved, free social care would extend to those whose need was judged as “substantial”, eventually some level of support would be extended to those with “moderate” needs, though there would remain an expectation that they contribute towards those costs – subject to a means test.

In our response to the Barker Review we stated:

“The TUC believes there is merit in looking at the recommendation of the Barker Review for a “single ring-fenced budget for health and social care that is singly commissioned and within which entitlements are more closely aligned””

We feel that the Barker review is a stepping stone to a national health can social care system. The costs of the system would be outweighed by the improvement in quality of life for those reliant on social care but currently caught outside the threshold for local authority support. It might even carry some economic benefits.

As well as ineffective and occasionally inhumane, the current system is economically inefficient. In a recent speech Andrew Dilnot himself raised the opportunity costs of the status quo:

“… because most people will in fact, not face the very high social care costs, everybody saving enough and hording enough just in case they do face that risk means that we have people on low to moderate wealth, dying with significant wealth they should have spent on themselves which they have been hording because they’ve been having to self-insure”.

A National Health and Social Care system would free people from the need to self-insure. This would mean that money kept horded to prepare should the worst happen could now be spent more productively – potentially stimulating demand across the economy.

Social care is something that will affect almost everyone – either directly or through the needs of loved ones and relatives. So, the most important effect of a unified health and social care system would be that it reaffirms the value and dignity in a collective response to a collective problem, and leaves no one to cope with long-term care needs alone.

Leave a Reply

Your email address will not be published. Required fields are marked *