Boris Johnson announces social care funding reform

Boris Johnson has announced a 1.25% tax increase to fund reforms of adult social care.

The prime minister said reforms will provide means-tested social care funding for people with assets between £20,000 and £100,000.

Those with savings of less than £20,000 will receive fully-funded care, while those with savings between £20,000 and £100,000 will be given partial support.

Boris Johnson told MPs that a new cap, which will be introduced from October 2023, will mean no one will be required to pay more than £86,000 for social care in their lifetime.

The reforms will be paid for with an increase to national insurance, which is levied on anyone who earns more than £9,564 per year. 

The additional tax will also be levied on people who receive income from share dividends.

People who work after the state pension age will also pay 1.25%.

A portion of the money raised will be partially be diverted to the NHS until mid-2025. This comes after helath bosses announced £36bn would be sentto the health service to reduce backlogs and waiting lists created by the Covid-19 crisis.

Current rules on housing assets, which prevents people who receive care at home from having to sell their houses, will remain.

Boris Johnson said: ‘A condition like dementia, nature’s bolt from the blue, could lead to the total liquidation of a persons assets, their lifetime savings, their home, the loss of everything that they might otherwise pass on to their children

‘A universal system of free care for all would be needlessly expensive when those who can afford to contribute to their care should instead. 

‘The state should target itself, by protecting people against the catastrophic fear of losing everything, to pay for the cost of their care.’

5 pieces of banknotes on yellow and white textile

Responding to news on social care funding, Social Care Institute for Excellence chief executive, Kathryn Smith, said: ‘The extra funding is more than welcome though what is just as important is how it is used.

‘We’ve been calling for a sustained increase in funding to stabilise the system and to meet growing demand. The funding is desperately needed and must be ring-fenced to social care.

‘And then it will be up to all of us in the sector to work to maximise the best use of this funding. A fully transformed social care system needs to be personalised for people, using their assets rather than asking what is wrong with them.

‘It needs to be more integrated with health; and regularly adapting to innovation to reach more people and extend the workforce. And it must put people who draw on services at its heart so that they are central to the decisions made about them.

‘We call that co-production. In turn that will attract more people to the social care workforce, so that people who draw on services have much better experiences and outcomes.’

Nicholas Endean, solicitor and community care specialist at Moore Barlow, said, while the funding is welcomed, it’s vital that we see the pound and pence reach those who need it most in the short term.

‘Urgent action is needed to plug the black hole in social care funding and help fix the broken and outdated system.

‘While today’s spending announcement is to be welcomed, the devil remains in the detail as to how much funding will be made available to meet the demands of some of the most vulnerable in our society – it’s vital that we plan for the short and long term.

‘For too long, elderly and disabled individuals have had to navigate challenging budget cuts and reassessments to secure the right quality care package to support their day-to-day living. We’ve heard a lot of rhetoric and broken promises in recent years and hopefully, today marks a step, finally, in the right direction.’

Professor Martin Green, chief executive of Care England, said he hoped that social care would be rewarded and recognised rather than playing second fiddle to the NHS:

‘We have been waiting for a very long time for any concrete plans on the long term sustainability of adult social care reform and as such we welcome the Prime Minister’s announcement today.

‘We want to go through the plans carefully and it is our hope that social care will be rewarded and recognised rather than playing second fiddle to the NHS. It is essential that money reaches the frontline.

‘The sector needs help now especially after the many challenges that became even more acute during the pandemic.

‘We hope these plans will comprehensively address the issues across the whole adult social care sector, including younger adults with learning disabilities and autism.

‘Recruitment and retention of the workforce, our best resource, is the most urgent issue at present and it is vital that any long term plans can be brought into play alongside immediate measures.

‘Care workers are everyday heroes and have highlighted their value throughout the pandemic and need to be rewarded and recognised appropriately.’

Photo Credit – Christopher Bill


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