Social care tax is a ‘non-starter’ argues think tank

The UK’s social care system cannot be fixed by creating new taxes or boosting public spending, according to a new report.

The report by the free market think tank Adam Smith Institute claims the current social care system is full of ‘perverse incentives’ and is ‘woefully out of date’.

It argues that making social care completely free of charge to everyone as part of the NHS is a ‘non-starter’ and boosting budgets will do ‘little good’.

Instead, the report calls for ‘new partnerships in new markets that embrace fundamental change’.

It warns that most care homes with council-funded residents are over 20 years old and no longer up to modern standards.

Equally, it claims self-pay residents get a raw deal from providers and insufficient protection from regulators.

And live-in carers hired by families typically have no qualifications and many are paid less than the national living wage.

And care delivered free to vulnerable people in their own homes by local authorities is usually selected on price, not quality, and there is very little use of modern information and artificial intelligence technology that could spectacularly raise its quality and efficiency, the report argues.

‘The idea of making social care free to everyone as part of the NHS, possibly funded by a new ‘care tax’, is a non-starter,” said report co-author Eamonn Butler.

‘The NHS has 170,000 beds in 1,300 hospitals. Adding another 480,000 beds in around 20,000 nursing and care homes would overwhelm it completely,’ he added.

The Institute thinks it unlikely that the government would stump up the hundreds of millions of pounds needed to upgrade residential homes, or that taxpayers would accept the extra burden.

Instead it advocates a partnership with private pension and insurance investors to develop large numbers of new and upgraded facilities and lease them to local authorities.

It also proposes a viable insurance system, where if people insure themselves for six years’ of residential care, the government would pick up anything beyond. ‘Nationalisation or pseudo nationalisation of the care sector would only compound the mistakes that have led to too many deaths,’ said Conservative MP, David Davis.

‘We need creative solutions to deliver large-scale private sector investment into the system that would improve patient outcomes. If more state control is the answer, then someone is asking a pretty dumb question.’

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